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Misleading claims may infringe competition law

Misleading claims (so-called “denigration”) about competitors’ medicinal products or devices may be illegal, as several recent cases from the European Commission and national competition authorities illustrate. Even if the allegations are not incorrect in themselves, their totality and framing (“what is not said”) can still cross the line. Companies must be very careful with this type of “information campaigns”.

In 2023, the Belgian Competition Authority fined Novartis EUR 2.8 million for abuse of its dominant position. The case concerned Novartis’ drug Lucentis, used by ophthalmologists to treat age-related macular degeneration (AMD), and Roche’s drug Avastin. Avastin was only registered for the treatment of certain types of cancer, but several studies had concluded that Lucentis and Avastin are both effective for the treatment of AMD, and Avastin had been used «off-label» in the treatment of AMD since 2005.

In the case, the Belgian Competition Authority found that Novartis had warned ophthalmologists, hospitals and regulators about the risks of “off-label” use of Avastin and that this was misleading in light of studies that had assessed the scientific uncertainty about the dangers of “off-label” use of Avastin. According to the Authority, there was nothing to prevent dominant undertakings from highlighting the qualities of their products compared to others, or criticizing the methodology and results of studies concerning their products, provided that this is part of a reasonable scientific debate. However, in the Authority’s view, Novartis had gone beyond the bounds of legality as it had alarmingly and excessively emphasized the possible negative side-effects of using Avastin “off-label” for treatment, the uncertainty associated with the results of the studies conducted and the legal risks involved for doctors in treating AMD with Avastin. According to the Authority, Novartis’ conduct constituted an abuse of a dominant position by means of misleading claims about competing products, in line with case-law from the ECJ.

Misleading statements about “off-label” use can also be sanctioned by the Norwegian Competition Authority under Section 11 of the Norwegian Competition Act, which mirrors the abuse of dominance prohibition in Article 102 TFEU. It is a condition for the prohibition to apply that the undertaking that is making the misleading statements is dominant in the relevant pharmaceutical market (medicinal products or devices), or, alternatively, holds a position of collective dominance with other undertakings.

If several undertakings join forces in such a strategy, the conduct may also potentially be sanctioned as an anti-competitive agreement under Section 10 of the Norwegian Competition Act, which mirrors the prohibition in Article 101 TFEU; cf. Case C-179/16 Hoffman-La Roche. The prohibitions against abuse of dominance and anti-competitive agreements, respectively, may be applied in parallel alongside each other in one and the same case. Misleading statements can thus either be sanctioned as an illegal collaboration with competitors to eliminate other (potential) competitors, and/or as an undertaking, or several undertakings collectively, being deemed to have abused a dominant position on the market.

It is worth noting that claims about «off-label» use that may be correct in themselves, but which are framed in a selective or tendentious manner, may also be misleading and sanctioned as an infringement, cf. e.g. the Advocate General’s Opinion in the aforementioned Hoffman-La Roche case to this effect.

In parallel with and following the Novartis case from Belgium, there have also been new decisions from the European Commission. In 2022, the Commission opened a formal investigation against Vifor, which was considered to have a dominant position in products for intravenous treatment of iron deficiency through its drug Ferinject. According to the Commission, Vifor had for several years disseminated potentially misleading information about the drug Monofer, a product from Vifor’s competitor Pharmacosmos. The Vifor case was closed in July 2024 after Vifor had offered commitments to the Commission, which were set out in a decision in Case AT.40777 Vifor (Iron Products). An interesting element of that case is that part of the binding commitments imposed on Vifor is that the company actually has to «promote a competitor» for a long period of time in the form of, amongst others, launching its own campaigns to correct the erroneous impression that had previously been created about Monofer. Just a few months after the Vifor case was closed with commitments, the European Commission fined Teva in a case that, in addition to misuse of the patent system, also concerned derogatory statements about competing medicines. According to the Commission, Teva had, over time, initiated a systematic and targeted campaign towards healthcare professionals, public authorities and others, whereby it had spread negative publicity about a competing medicine for the treatment of multiple sclerosis (MS), with misleading information about its safety and efficacy compared to its own medicine, Copaxone. Teva was fined approximately EUR 462 million, cf. Case AT.40588 Teva Copaxone.

Smear campaigns carried out through the use of third parties that conceal the actual sender of the information may also infringe national antitrust legislation. This was the case in the Danish Falck case, where the Danish Competition Authority concluded in 2019 that Falck had abused its dominant position by secretly disseminating and “leaking” negative stories about its competitor BIOS to the press and its own employees. The stories Falck had spread casted doubt on BIOS’ ability to deliver ambulance services and their quality as an employer. There was a shortage of healthcare professionals in Denmark at the time, and BIOS had to recruit Falck’s employees in order to fulfill a contract they had won in a tender, which was made more difficult by the spread of rumors from Falck. The Authority found that Falck was dominant on the market and that Falck’s conduct did not constitute competition “on the merits”, and that Falck’s conduct was likely to restrict competition in breach of the abuse of dominance prohibition.