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Court of Appeal

By James Henson

May 18th, 2020

Court of Appeal Judgment in the seminal Pfizer/Flynn excessive unfair prices case

With COVID19 dominating the last couple of months it has been easy to miss the Court of Appeal delivering its Judgment on 10 March 2020 in the case of Competition and Markets Authority v Flynn Pharma Ltd and others [2020] EWCA Civ 339.

The case concerned an appeal by the Competition and Markets Authority (CMA) against a Judgment of the Competition Appeal Tribunal that had set aside parts of the CMA’s decision (“the Decision”) that two pharmaceutical companies, Pfizer and Flynn, had breached Article 102 Treaty on the Functioning of the European Union/Section 18 Competition Act 1998 by charging unfairly high prices for the anti-epileptic drug, phenytoin sodium capsules.

In its Decision the CMA had imposed a penalty of £84,000,000 on Pfizer and £5,000,000 on Flynn.

The case raised important points of law, addressed in the Court of Appeal’s Judgment, concerning the test to be applied to determine when prices charged by dominant undertakings for goods or services amounted to an abuse of a dominant position, as to the nature of the duty upon a competition authority to evaluate evidence to be adduced by an undertaking in its defence and as to the powers of judicial bodies called upon to hear appeals from such authorities.

The case was particularly important and caused the European Commission to intervene in support of the CMA and Langleys Dispute Resolution Team assisted the Commission with its intervention in the Court of Appeal. 

The case is widely publicised as cases of pure unfair price fixing in the Appeal Courts are rare and although the subject matter concerned the pricing of pharmaceutical products the case is of wider application because the legal issues apply to all goods and services in the economy.

To some, the Judgment may also seem particularly pertinent in the current climate given that the CMA had intervened to protect patients, the NHS, and the taxpayers who fund it. 

Download a copy of the Court of Appeal Judgment.

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