Setterwalls advised in connection with the Swedish Competition Authority’s investigation of suspected coordination of price levels on generic drugs

In 2024, the Swedish Competition Authority initiated an investigation based on suspicions that companies have entered into agreements or coordinated on the pricing of generic medicines within the Swedish Dental and Pharmaceutical Benefits Agency’s (TLV) product of the period-system.

Following on-site inspections (also known as dawn raids) conducted by the Swedish Competition Authority at the companies concerned in Sweden, as well as inspections carried out by the Danish Competition Authority on behalf of the Swedish Competition Authority, the Swedish Competition Authority’s investigation found no evidence of any direct or indirect contacts between the parties with the aim of coordinating price levels or a rotation order within the product of the period-system. Therefore, the Swedish Competition Authority has closed the investigation without taking any further action.

According to the Swedish Competition Authority, the product of the period-system exhibits several features that allow competitors to maintain higher prices without having direct or indirect contact with each other, and to avoid price competition through so-called ‘tacit coordination’ or ‘parallel behaviour’. This type of behaviour is generally not prohibited by competition rules, as it stems from independent decision-making.

Consequently, the investigation did not find any evidence of price-fixing or collusion, and the Swedish Competition Authority concluded that the observed price patterns could have reasonable alternative explanations.

The decision illustrates the particular market structures that exist within the product of the period-system, and confirms that the companies’ behaviour reflects typical market behaviour in a regulated market – such as the product of the period market – where the pricing strategy is based on an analysis of historical and publicly available data.

The Swedish Competition Authority will continue the dialogue with TLV in order to ensure an appropriate design of the product of the period-system from a competition perspective. What this means in more concrete terms remains to be seen.

Setterwalls has many years of experience in assisting companies and acting proactively in all types of competition law matters and issues. Please do not hesitate to contact us to discuss how we can help your company prepare, for example by reviewing and improving internal procedures for dawn raids.