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Abuse of a dominant position, denigration and misleading speech: disinformation sanctioned (Update Distribution / Competition by Christophe Héry and Claire Burlin, sept. 2020)

Published on : 02/10/2020 02 October Oct 10 2020

Publications et Séminaires

Disinformation carried out by one or more company(ies) can take many forms, targeting consumers, customers, influencers or public authorities, and targeting the image of competitors or their products or services. Depending on the case, it can be sanctioned on the basis of competition law, press freedom law or unfair competition law.

On September 9, 2020, the French Competition Authority (“Autorité de la concurrence” / AdlC) recalled, in a specific case, that denigration or disinformation could constitute an abuse of a dominant position by condemning Novartis, Roche and Genentech to the payment of a fine of 444 million euros. (See AdlC decision 20-D-11 here).

In a nutshell, AdlC found that the three laboratories attempted to curb the use of Avastin (produced by Genentech) as part of the treatment of age-related macular degeneration (AMD) because this product, which was initially an anticancer drug, has proved to be an effective and much cheaper alternative to Lucentis, also produced and marketed by these laboratories. Thus, curbing the use of Avastin in favor of Lucentis allowed them to maintain an artificially high price of this drug on the AMD market.

AdlC first retained that Novartis, Roche and Genentech formed a collective entity for the purposes of marketing the two drugs (Lucentis and Avastin), holding a dominant position in the AMD treatment market given the existence of important and strategic structural links between the laboratories (in particular the license agreements between Genentech and Novartis, for the marketing of Lucentis, and Genentech and Roche, for the marketing of Avastin) and the existence of crossed capitalistic links.

Then, it identified practices of denigration and disinformation of this treatment with the medical world (especially Key Opinion Leaders) as well as alarmist and misleading speeches with the public authorities in order to block their initiatives aimed at securing its use without authorization of marketed for the treatment of AMD.

Finally, AdlC did not fail to point out, at the sanction stage, that these practices occurred in a context of public debate on the extremely high price of Lucentis and its impact on social finances, while the Avastin, significantly cheaper, was likely to be used.

If these practices have been implemented by three laboratories against a treatment produced and marketed by themselves, abuse of a dominant position can be more classically established when a laboratory in a dominant position denigrates the specialties or devices of a competitor. For example, in the "Plavix" case, the French Court of Cassation upheld the conviction of the Sanofi Aventis laboratory for having disseminated a broad and structured communication to healthcare professionals aimed at denigrating competing generic medicines. The similarities between the cases remain limited because the Sanofi Aventis laboratory was condemned even though the information relating to the differences between competing generics and the Plavix it marketed was correct (Cass. Com. December 18, 2014, n ° 2013 / 12370).

This decision is also an opportunity to recall that, more broadly, French law places limits on criticism of a competitor. Thus, the fact of criticizing a company (or its directors) by attributing to them specific facts (such as corruption, non-compliance with regulations, fraud, etc.) can only be sanctioned on the basis of the defamation provided for by the law of July 29, 1881 on press freedom, while the fact of criticizing a product or a service of a merchant can be sanctioned only on the basis of an action in unfair competition by denigration, even in the absence of a situation of direct and effective competition (Cass. Com. 26 September 2018, n ° 17 / 15.502; Cass. Com. 19 January 2019, n ° 17 / 18.350 ; Cass. Com. 13 March 2019, n° 18 / 11.046) (See our article here).

By Christophe Héry and Claire Burlin

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