On 10 December 2024, the Competition and Markets Authority (CMA) published a notice of intention to accept commitments from Vifor Pharma (Vifor) to address concerns relating to claims in Vifor's marketing communications to healthcare professionals about rival treatments. The CMA and Vifor have provisionally agreed that Vifor will pay £23 million, ex gratia, in compensation to the UK's National Health Service (NHS) and contact healthcare professionals to correct any potentially misleading communications regarding other intravenous iron treatments in comparison to its own, Ferinject. The CMA will close its investigation without making a final ruling on whether Vifor broke the law. The consultation on Vifor's proposed commitments closes on 17 January 2025.

Vifor, a major player in the pharmaceutical industry, has been under investigation since January 2024 for potentially spreading doubt among healthcare professionals regarding the safety and effectiveness of Monofer, a competing product from Pharmacosmos.  This strategy, known as "disparagement", consists of statements which, though they do not explicitly criticise a rival product, contain connotations which create uncertainty as to the safety or viability of similar (and usually cheaper) products as an alternative option for patient treatment.

For companies enjoying a dominant position – for example where they hold a patent and the relevant market is defined narrowly – such practices have been considered to be anti-competitive on the basis that they are not competing "on the merits" (in other words, fairly) with smaller operators. In such a scenario, competition regulators' concern is that the disparagement campaign may influence healthcare professionals' judgement and lead them to unjustifiably favour the more expensive product over affordable alternatives, with a negative impact on buyer (in the case of the UK, the NHS) costs. According to competition regulators, this behaviour can amount to an abuse of dominance contrary to Chapter II of the Competition Act 1998 (CA 1998) in the UK and equivalent regimes globally.

Broader cross-border and cross-industry trend

This latest example of enforcement action is part of a broader cross-border trend focussing on disparagement and the provision of misleading information by potentially dominant companies, both in the pharmaceutical industry and beyond.

In a pharmaceutical context:

• between June 2022 and July 2024, the European Commission (EC) conducted its own investigation into Vifor's practices under Article 102 of the Treaty of the Functioning of the European Union (TFEU), the EU equivalent to Chapter II of the CA 1998. The EC and Vifor reached a similar compromise to the CMA, except that Vifor's EU commitments did not include any ex gratia payment to payors. Specifically, Vifor agreed to launch and for a period of 10 years maintain a comprehensive communication campaign across multiple channels to correct any misinformation, not to comment through external promotions or medical communications on Monofer's safety, and to implement appropriate measures and safeguards to ensure compliance with the commitments. Separately, Pharmacosmos had filed a private damages claim against Vifor, with the parties reaching a settlement agreement in February 2024, the terms of which remain confidential;
• the EC also fined Teva Pharmaceuticals €463m in October 2024 for similar conduct in relation to its marketing of multiple sclerosis drug Copaxone (Teva has indicated it intends to appeal the decision); and
• the French Competition Authority has issued a number of "disparagement" decisions since 2013, including in relation to Sanofi-Aventis' Plavix (2013, €40.6m fine), Schering Plough's Subutex (2013, €15.3m fine), Janssen Cilag's Durogesic drugs (2017, €60m fine), as well as more recently fining Roche, Novartis and Genentech a total of €444m for abusive practices relating to age-related macular degeneration drug Lucentis – though note the latter decision was annulled on appeal in 2023, with further proceedings pending.

There are also examples in other industries:

• in August 2022, following an investigation by the Australian Competition and Consumer Commission, the Australian Federal Court ordered Google LLC to pay $60m in penalties for making misleading representations to consumers in relation to the personal location data it collected and used from their mobile devices; and
• in 2020, the Italian Competition Authority relied on its consumer protection powers to fine Apple €10m for making misleading claims around the water resistance of some of its iPhone models. Apple may also soon face a class action in Canada in relation to similar claims made to Canadian consumers.

Communications to healthcare professionals are a key way in which manufacturers of branded medicines compete

For branded medicines, marketing and medical affairs efforts directed at healthcare professionals are an important aspect of competition between manufacturers. In the context of biosimilar products, highlighting nuances between competing medicines that are inevitably created or manufactured in slightly different ways has been a common approach to date.

Communications of this type are already regulated under sector-specific rules to make sure that they contain balanced, accurate and complete information, particularly regarding safety, and pharmaceutical companies' marketing teams and representatives will be familiar with this landscape.

But as we explain below, competition regulators' latest approach adds a new layer of complexity for marketing and medical affairs teams to navigate.

The latest trend is a step change in risk

Competition authorities' scrutiny of the pharmaceutical industry is not new and there are many examples of various forms of unilateral conduct that have historically been the target of enforcement. For example:

• Pfizer and Flynn faced a combined fine of £69 million for charging excessive prices for phenytoin sodium capsules (used for the treatment of epilepsy) in the UK;
• Leadiant faced multiple fines in Europe and Israel whilst Aspen faced pricing commitments in the EU for similar anti-competitive conduct; and
• similarly, AstraZeneca were fined for "regulatory gaming", having de-registered the molecular formulation of Losec and intentionally misled regulatory authorities to delay the market authorisation of competing products.

However, this latest trend indicates a step change in risk for pharmaceutical patent holders. Specifically:

• it is no longer enough to ensure that employees do not engage in anti-competitive strategies to discredit rival products;
• if a communication is capable of being misleading, whether or not this was the intention, dominant companies can be investigated and potentially punished for anti-competitive behaviour; and
• the competition authorities' latest actions and indications suggest that any subtle communication that could manipulate or confuse the recipient's perception of the essential characteristics of an alternative product may qualify as misleading information. This is the case even where the person receiving the information is a healthcare professional with medical expertise, as opposed to a consumer. This can include subtle omissions.

Incoming UK and EU consumer protection reforms are also set to play a role

In the UK, the CMA's suite of regulatory tools is also set to expand, with bolstered consumer protection enforcement powers due to come into force from Spring 2025 through the Digital Markets, Competition and Consumers Act 2024 (DMCCA).

Although healthcare prescriptions are explicitly excluded from future DMCCA rules relating to protecting consumers who enter into subscription contracts (section 255 and Schedule 22), other consumer protection measures will be relevant to the medicine supply chain. In particular, the new regime includes rules against making misleading claims to consumers (including by omission), regardless of whether companies making the claims are dominant, with similar maximum fines as for competition law breaches (up to 10% of global annual turnover).

In anticipation of these legal changes, the CMA has steadily been ramping up its consumer law enforcement activities in recent months, with a specific focus on misleading environmental claims and "greenwashing", which shows an existing appetite for tackling potentially misleading practices beyond the realm of companies with significant market power. These cases in particular have reverberated through the supply chain for a range of products.

The CMA has also begun to close dominance abuse investigations and signpost that it plans to use its new consumer protection powers instead in due course (e.g. as with Apple earlier this year).

In the UK this comes against a backdrop of continued focus on the procedures which large companies have in place to ensure that their employees and representatives stay within the lines, including a new "Failure to Prevent Fraud" offence under the Economic Crime and Corporate Transparency Act 2023 (ECCTA), due to come into force on 1 September 2025. If you would like to know more about the future failure to prevent fraud offence under ECCTA and what it might mean for your business, you can access our Understanding the new corporate criminal standards: a toolkit here.

While pharmaceutical patent holders and their staff will be familiar with regulatory focus, this recent development increases the level of risk associated with marketing communications for the whole industry. The risk of enforcement action and private damages actions is now greater, and customers (both public and private) may see this as an opportunity.

It remains to be seen how competition and consumer protection regulators will exercise their powers in contexts where product differences between competing branded medicines are more pronounced, though we can expect that product comparisons will still have a place in marketing communications going forward – provided they are clear and supported by robust scientific evidence. Going forward, there may be contexts where medicine manufacturers decide to resort to this particular marketing technique less systematically and limit it to specific situations where the risk can be suitably managed.

In practice, pharmaceutical companies should review their existing compliance processes relating to marketing and medical affairs communications and practices and update them to reflect the above developments, as well as their company's own risk appetite. In doing so, to minimise risk "on the ground" we would recommend making sure that medical affairs and marketing teams are given strict guardrails to operate within, with staff training to reinforce the company message and ongoing process review.