The Lundbeck Case and the Concept of Potential Competition

Antitrust rules have been brought into play in situations whereby a company tries to prevent, or at least delay, the entry into the market of potential competitors. This issue has gained prominence in the context of patents and intellectual property (IP) rights in the pharmaceutical industry. Patent holders of a drug sometimes enter into a ‘reverse payment agreement’ with generics manufacturers, in order to settle prospective patent litigation. The sum agreed might also cover delaying the entry of the generic version of the drug into the market (‘pay-for-delay’ settlement), which could be harmful for competition. And yet the fact remains that, when reverse payment agreements are entered into, the generics manufacturers are not actual competitors of the patent holder. To what extent should the application of competition extend to a future threat which may never materialise? This paper brings together a panel of experts in order to analyse these issues, recently highlighted by the General Court’s judgment in the Lundbeck case