AAH Pharmaceuticals Ltd & Ors v Pfizer Ltd & Anor

When deciding an application for a mandatory interim injunction, the court applies the approach that minimises the risk of injustice if the order proves wrong. A mandatory order may involve a greater risk of injustice than a prohibitory order, but no exceptional competition-law test applies. The court may consider whether there is a high degree of assurance that the claimant will establish its rights, while retaining power to grant relief where the balance of injustice favours it. The court should also take account of the specialist regulator’s assessment, although it is not bound by that assessment. Delay which deprives the defendant and court of a proper opportunity to consider a complex application is a powerful factor against relief.

The claimants, pharmaceutical wholesalers, sought mandatory interim injunctions requiring Pfizer to continue supplying them with prescription drugs. Pfizer had announced for several months that it would cease supplying wholesalers and had arranged for UniChem to provide logistics services under a direct-to-pharmacy scheme.

The claimants alleged infringements of Articles 81 and 82 of the EC Treaty and Chapters 1 and 2 of the Competition Act 1998. They had complained to the Office of Fair Trading but applied to the High Court shortly before the new arrangements were due to begin. The central issues were the correct approach to a mandatory interim injunction, the significance of the OFT’s preliminary position, and the balance of the risks of injustice.

1. Application refused. The claimants sought a mandatory order requiring Pfizer to resume supplies. The court assumed, for present purposes, that the claimants had a seriously arguable case sufficient to satisfy the test in American Cyanamid v Ethicon.
2. The applicable approach was that stated in Nottingham Building Society v Eurodynamic Systems and approved by the Court of Appeal in Zockoll Group Ltd v Mercury Communications Ltd: the overriding consideration was which course involved the least risk of injustice if wrong. A mandatory order could carry a greater risk because it required positive action, but applications concerning Articles 81 and 82 did not attract a different or exceptional test.
3. The court was entitled to take account of the OFT’s position. The OFT had specialist expertise and had not yet formed a firm view that there were reasonable grounds for suspecting an infringement. That position was not binding, but the judge had been unable, in the limited time available, to conclude that a strong infringement case had been shown.
4. The evidence did not establish a significant short-term risk that pharmacies or dispensing doctors would switch substantial business to UniChem. Conversely, an injunction granted at the last minute would cause real disruption and reputational damage to Pfizer and UniChem that would not readily be compensated.
5. The claimants’ delay was independently powerful against relief. The issues and proposed arrangements had been known for months, yet the application was supported by extensive evidence and brought without a proper opportunity for response or judicial consideration. Refusal of the injunction therefore involved the least risk of injustice.