The European Commission has launched an investigation to determine if Zoetis may have breached EU competition rules by preventing the launch of a competing medicine used to treat chronic pain in dogs.
The global animal health company, headquartered in the US, sells the first and only monoclonal antibody medicine approved in Europe, called Librela, used to treat pain associated with osteoarthritis in dogs.
The medicine is administered monthly and offers a novel pain relief option, especially for older dogs.
Zoetis
As Zoetis was developing Librela the commission said that it acquired another another late-stage pipeline product which had a similar indication of pain relief.
This other drug was going to be commercialised in the European Economic Area (EEA) by a third party.
The EEA includes the 27 EU member states, along with Norway, Iceland and Liechtenstein.
The commission is concerned that Zoetis may have engaged in exclusionary behaviour contrary to EU antitrust rules by terminating the development of this alternative pipeline product and refusing to transfer it to the third party which had exclusive commercialisation rights in the EEA.
If proven, the behaviour under investigation may breach EU competition rules, which prohibits the abuse of a dominant position that may affect trade within the EU and prevent or restrict competition.
In a statement to Agriland, Zoetis said that the commission’s investigation relates to an experimental compound from an acquisition that the company completed seven years ago.
“We believe that both the acquisition of the compound and our subsequent decision to cease development of it were sound, rigorous, and lawful.
“While we cannot comment in detail on the specifics of the investigation, we will continue to cooperate with the European Commission throughout this process and are confident it will conclude that any potential concerns are unfounded,” it said.
Investigation
This is the EU Commission‘s first formal investigation into a potential abuse relating to the exclusionary termination of a pipeline product which was to be commercialised by a third party.
The commission said that it will carry out its in-depth investigation “as a matter of priority”.
It added that the opening of a formal investigation does not prejudge its outcome.
There is no legal deadline for bringing an antitrust investigation to an end and its duration depends on a number of factors, including the complexity of the case, the extent to which the companies concerned cooperate with the commission and the exercise of the rights of defence.
Commenting on the launch of the investigation, Margrethe Vestager, EU Commission executive vice-president in charge of competition policy said:
“Competition in veterinary medicines ensures pet owners can choose between different safe, innovative, and affordable medicines.
“This is why we are investigating whether Zoetis may have unlawfully prevented the entry of a novel medicine used to treat chronic pain in dogs which could have competed with its own biologic medicine Librela,” she added.
Zoetis has a significant presence in Ireland, which includes commercial offices and manufacturing sites, employing several hundred people.
The company’s Cherrywood, Dublin office is the headquarters for its international commercial operations and global manufacturing and supply organisations, as well as the home of local commercial operations for Ireland.
In addition to its veterinary medicines facility in Tullamore, Co. Offaly, the company has two manufacturing sites based at Rathdrum, Co. Wicklow and Tallaght, Dublin.