Originally published as Covington E-Alert on October 9, 2009

May a pharmaceutical company charge its wholesalers one price for products to be resold under the national healthcare reimbursement rules, and another, higher price for products to be resold in another EU member state? This was the question addressed by the European Court of Justice (ECJ) in its much-anticipated 5 October 2009 judgment in GSK v Commission. In a favourable ruling for the pharmaceutical industry, the ECJ largely upheld the 2006 judgment of the European Court of First Instance (CFI) finding that these dual pricing systems are not necessarily incompatible with the EC competition rules, but rather must be judged on a case-by-case basis in the light of the specific structural features of the pharmaceutical sector and the impact of parallel trade on the ability of pharmaceutical companies to fund R&D. The ruling also has favourable implications for other strategies used by pharmaceutical companies to control parallel trade, such as supply chain management systems.

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Photo of Peter Bogaert Peter Bogaert

Peter Bogaert has a broad European life sciences practice. He has detailed regulatory expertise under EC and national laws, handles legislative and other policy assignments and provides strategic advice. He also represents life sciences companies before the European Courts in Luxembourg and in…

Peter Bogaert has a broad European life sciences practice. He has detailed regulatory expertise under EC and national laws, handles legislative and other policy assignments and provides strategic advice. He also represents life sciences companies before the European Courts in Luxembourg and in local litigation in Belgium. Mr. Bogaert’s practice covers pharmaceuticals, biotechnology, medical devices, special foods and feed, cosmetics and other consumer products and he presents numerous innovative life sciences companies, including start-ups, as well as several industry associations.