Opinion of Mr Advocate General Darmon delivered on 16 March 1988. - Commission of the European Communities v Italian Republic. - National rules governing the prices of pharmaceutical products. - Case 56/87.



European Court reports 1988 Page 02919



Opinion of the Advocate-General

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Mr President,

Members of the Court,

1 . In these proceedings, the Commission is asking the Court to declare that the Italian Republic has failed to fulfil its obligations under Article 30 of the Treaty in regard to the fixing of prices for pharmaceutical products . Its essential complaint is that the method adopted by the defendant Member State is based on criteria specifically related to the situation in Italy which expressly favour national products and thus make the marketing of imported products more difficult .

2 . The Italian Republic has indicated that it intends to adopt, as soon as possible, amendments designed to avoid any suspicion of discrimination against imported products .

3 . It should be noted that the Italian rules expressly favour national products in several respects . Thus, the principles set out in paragraph A.1 . of the decision of the Interministerial Committee for Economic Planning of 11 October 1984 state that the method of fixing prices for pharmaceutical products must be oriented towards the objectives of promoting the development of the national pharmaceutical industry . Paragraph 1.1 . of the decision of the Interministerial Committee on Prices of 24 October 1984 states that "proper attention must also be given to the pursuit of the objectives of promoting productive investment on national territory ". ( 1 )

4 . Effect is given to those objectives by the provisions of paragraph B.4.1 . of the decision of the Economic Planning Committee, which provides that the costs of research to be taken into account, which normally must not exceed 10% of the industrial product, may be increased to 12% as regards research having led to considerable investment in the national territory . Similarly, paragraph B.4.2 . provides that pharmaceutical specialities considered to be particularly original and innovative are to benefit from a rate of increase of 20% in normal cases and 40% in the case of products which are the result of research carried out entirely on national territory .

5 . Finally, the method adopted takes no account of the special position of imported products .

6 . Let me draw attention first of all to the terms of Commission Directive 70/50/EEC, ( 2 ) which declares incompatible with Article 30 of the Treaty measures which "preclude any increase in the price of the imported product corresponding to the supplementary costs and charges inherent in importation" ( 3 ) and those which "fix the prices of products solely on the basis of the cost price or the quality of domestic products at such a level as to create a hindrance to importation ". ( 4 ) The rules at issue clearly infringe those provisions .

7 . Moreover, although the Court' s judgment in Roussel ( 5 ) left intact the possibility for Member States to combat inflation, they may do so only by means of "measures which do not place imported medicines at a disadvantage ". Although the Court' s judgments in Tasca ( 6 ) and Danis ( 7 ) concerned price rules applicable without distinction, unlike the rules at issue here, the Court classified such rules as quantitative restrictions once they made the marketing of imported products either impossible or more difficult than that of national products . In its judgment in Cullet, ( 8 ) the Court held that :

"... in order to avoid any disadvantageous effect on the distribution of imported products on the market, those criteria (( for the fixing of prices )) must take due account of the ex-refinery prices of all traders, regardless of the origin of the goods ."

8 . In this case the system which has been set up expressly favours national products, which benefit from the fact that account is taken only of research carried out on Italian territory, entailing an obvious disadvantage for imported medicines . Moreover, the absence of any reference to the costs and charges inherent in importation and to cost components in the other Member States cannot but reinforce that discriminatory situation .

9 . I therefore propose that the Court should declare that by adopting and applying a method for fixing the prices of pharmaceutical products taking account of factors specific to national products in such a way as to favour the latter and disregarding the situation of imported products, the Italian Republic has failed to fulfil its obligations under Article 30 of the Treaty . I propose that the Court should order the Italian Republic to pay the costs .

(*) Translated from the French .

( 1 ) My emphasis .

( 2 ) Directive 70/50/EEC of 22 December 1969 based on the provisions of Article 33 ( 7 ), on the abolition of measures which have an effect equivalent to quantitative restrictions on imports and are not covered by other provisions adopted in pursuance of the EEC Treaty ( Official Journal, English Special Edition 1970 ( I ), p . 17 ).

( 3 ) Article 2 ( 3 ) ( d ).

( 4 ) Article 2 ( 3 ) ( e ).

( 5 ) Judgment of 29 November 1983 in Case 181/82 Roussel Laboratoria BV and Others v Netherlands (( 1983 )) ECR 3849, paragraph 24 .

( 6 ) Judgment of 26 February 1976 in Case 65/75 Ricardo Tasca (( 1976 )) ECR 291 .

( 7 ) Judgment of 6 November 1979 in Joined Cases 16 to 20/79 Joseph Danis and Others (( 1979 )) ECR 3327 .

( 8 ) Judgment of 29 January 1985 in Case 231/83 Henri Cullet v Centre Leclerc Toulouse (( 1985 )) ECR 305, paragraph 26 .