Clifford Chance
Russian Dominance Rules
7 September 2011
It has been widely reported in the Russian press that at the end of July 2011 Russia's Federal Antimonopoly Service ("FAS") and the Russian subsidiary of Novo Nordisk ("Novo Nordisk") settled their legal dispute over Novo Nordisk allegedly having abused its dominant position on the wholesale market for insulin by refusing to supply and discriminating against certain distributors. FAS had found Novo Nordisk to have steadily reduced the number of distributors to which it supplied insulin products. In 2006 it had 40 distributors, whereas by 2007 the number had fallen to 20, and Novo Nordisk later refused to continue supplies to all but five regional distributors.
Under the circumstances it was to be expected that FAS would see signs of unjustified refusal to supply by a market-dominating manufacturer of pharmaceuticals. In their settlement Novo Nordisk admitted to having abused its dominant position, while in exchange FAS decreased the fine imposed on Novo Nordisk from RUB 86 million (approx. EUR 2.1 million) to RUB 53 million (approx. EUR 1.3 million).
This note contains a selective summary of certain issues that we consider to be of significance for suppliers.
