carta de compatibilidad

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In our April 23, 2020 post, we reported that the European Commission (“EC”) had issued a Temporary Framework Communication (the “Communication”) offering competition guidelines to allow cooperation between companies in emergency situations related to the COVID-19 health crisis.

In the current context, the EC is aware of the doubts that may arise on applying competition law to cooperation agreements or projects to address the shortages caused by the coronavirus crisis. Therefore, the Communicationhas established a temporary advisory procedure for companies, to offer greater certainty in this regard. The EC has also set up an information website on COVID-19 and a specific email address: COMP-COVID-ANTITRUST@ec.europa.eu.

As part of this procedure, on April 8, the EC issued a comfort letter to the Medicines for Europe associationregarding a voluntary cooperation project between pharmaceutical manufacturers to improve supply and increase production of certain essential hospital medicines to treat seriously ill COVID-19 patients, including sedatives, neuromuscular blocking agents, strong painkillers, vasopressors, antibiotics and adjuvants.

The letter, published on April 29, states that the cooperation proposed by Medicines for Europe requires companies to coordinate on production capacity in Europe and identifying mechanisms to optimize the resources available in the industry. The EC believes this cooperation is necessary to achieve the objectives pursued. Medicines for Europe has agreed to introduce the following safeguarding measures to ensure that cooperation does not exceed what is essential:

  • First, cooperation must be open to any pharmaceutical company that wishes to participate.
  • Second, minutes of all meetings must be drafted and kept, and copies of any cooperation agreement reached between companies must be shared with the EC.
  • Third, exchanging sensitive commercial information between manufacturers will be restricted to the information essential to effectively achieve the previously set objectives. The EC will provide companies with a controlled forum for these exchanges. The EC will also provide support where appropriate, and the European Medicines Agency and national health systems will participate in its development. The companies’ information will be compiled by Medicines for Europe or a third party appointed by it, and it will be made available to the participating companies only in aggregate form.
  • Fourth, the cooperation will be restricted to the period the supply shortage risk remains present, including the scenario of a possible second peak on the COVID-19 epidemic.

The EC states that the comfort letter does not cover any price discussion or any other possible coordination on issues not strictly necessary to achieve the set objectives in the most efficient manner possible. This comfort letter is subject to the participating companies not raising the price of the products concerned beyond what is necessary because of possible cost increases. The EC also stresses that any opportunistic behavior using the crisis to conceal collusion or other behaviors contrary to competition will not be tolerated.

The EC has agreed to publish the comfort letters issued in response to queries on cooperation projects foreseen to deal with the consequences of COVID-19. These letters are a useful guide to self-assess possible cooperation projects between competitors planned in the context of the current health crisis.

This post is also available in: Español

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cristina.vila@cuatrecasas.com

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