Decisions on the Relationship between Competition Law and Intellectual Property
Decision of the Competition Commission COMCO in its investigation against Novartis for alleged patent abuse
The Swiss Competition Commission COMCO investigated whether Novartis had abused patent rights following a complaint by the pharmaceutical company Eli Lilly and Company (investigation 32-0278). The case concerned a drug marketed by Novartis under the brand name Cosentyx® for the treatment of psoriasis and a patent portfolio acquired by Novartis from the US biotechnology company Genentech. Eli Lilly claimed that Novartis was using this patent portfolio to block Eli Lilly’s competing product Taltz®.
According to the COMCO decision of October 7, 2024, Novartis’ primary objective in acquiring the patent portfolio was to secure freedom to operate, i.e., the ability to manufacture and sell the drug Cosentyx®. The COMCO found that Novartis had not abused its patent rights and closed the case without examining the issues of market definition and Novartis’ position in this market.
Decision of the Federal Supreme Court in the investigation by the Competition Commission COMCO against Galenica (Vifor Pharma Participations AG and HCI Solutions AG) concerning drug information
In the investigation by the Competition Commission COMCO against Galenica (Vifor Pharma Participations AG and HCI Solutions AG) concerning electronic drug information, the Swiss Federal Supreme Court, in its decision of January 23, 2025 (2C_244/2022) overturned the sanctions imposed by the COMCO and the Federal Administrative Court on the grounds that the restrictions on competition resulted from copyright law and that competition law was therefore not applicable. The court considered that competition law does not apply to competitive conduct whose restrictive effect results directly and immediately from intellectual property law, in this case from copyright law. The contractual clause at issue in this case did not go beyond the restriction of competition resulting from copyright law, which is why competition law did not apply to it.
Comments
When the question arises as to whether the exercise of intellectual property rights constitutes a violation of competition law, it must first be examined whether competition law is applicable at all. If this is not the case, the competition authorities have no legal basis for initiating an investigation and imposing sanctions. In civil or criminal proceedings, too, allegations of competition law infringements in the exercise of intellectual property rights may be unfounded because competition law is not applicable.
This information does not constitute legal advice. Each case must be examined individually for this purpose.