Internet Sales of Dermocosmetics: the Paris Court of Appeal Refers the Case to the Court of Justice of the European Communities

CASTRES, France - The case opposing the French Competition Authority and Pierre Fabre Dermocosmetics (PFDC) came before the Paris Court of Appeal on Thursday, 29 October 2009.

It may be remembered that in this case, the “Conseil de la Concurrence” (now called Autorité de la Concurrence) [Competition Council , now called the Competition Authority] condemned Pierre Fabre Dermocosmetics to pay a fine of EUR17,000 and ordered the company to allow its products to be sold over the Internet.

Pierre Fabre DC appealed against this “Conseil de la Concurrence” Decision on 29 October 2008 and obtained a stay of execution of the injunctions pronounced by the Council from the Paris Court of Appeal in February 2009.

Pierre Fabre maintains that only the physical presence of a graduate pharmacist guarantees that consumers receive the best possible advice from a qualified professional.

In its decision, the Paris Court of Appeal recognized that PFDC had serious grounds for its rationale and decided:

- To put a preliminary question to the CJCE (the Court of Justice of the European Communities) so that this court determines if, by law, “the general and absolute prohibition to sell contract products on the Internet to final users imposed on approved distributors within the framework of a selective distribution network constitutes a hardcore restriction of competition by object”, - To defer ruling pending the decision of the CJCE, - To confirm the stay of execution of the injunctions pronounced by the Competition Authority against PFDC.

In concrete terms, this means that the Internet sales of Pierre Fabre dermocosmetics continue to be prohibited pending the opinion of the CJCE and a final decision by the Paris Court of Appeal.

Pierre Fabre remains opposed to internet sales and to all remote sales of their dermo-cosmetics as this cannot guarantee that customers receive individually tailored advice from qualified professionals, it encourages counterfeiting, and prevents the complete traceability of products which is the only guarantee of good cosmetic vigilance.

Since 2006, Pierre Fabre DermoCosmetics is the only company in its sector of activity that has refused to give into the competition Authority’s injunction, in order to defend the quality and professionalism of the distribution network of its products.

About the Pierre Fabre Group:

The Pierre Fabre group is the second largest independent French pharmaceutical company with a 2008 turnover of EUR1.75 billion. It employs nearly 10,000 people.

The activities of the Pierre Fabre Group are divided between Drugs (sales of EUR552 million ), OTC (EUR352 million ), and dermo-cosmetic (EUR829 million).

The “dermo-cosmetics” activity is splited into 2 divisions: dermatology and dermopharmacy, which safely offers to pharmacists, prescribers and users, effective products which are perfectly well tolerated by the skin, hair and nails, containing mainly active substances of natural origin.

- Dermatology with the brands: Avène, Ducray / A-Derma, Pierre Fabre Dermatologie and Glytone. - Dermopharmacy with the brands: Klorane, Galénic / Elancyl and René Furterer.

The “family health”(OTC) branch, which is divided into 2 departments: Pierre Fabre Santé and Naturactive, provides pharmacists and patients with a wide range of medicines, Over the Counter’s products (OTC) and self medication products for everyday health and well-being. Each of these departments focuses on specialized therapeutic fields: Pierre Fabre Health on immunity, smoking cessation, woman’s health, movement disorders, infectious diseases, skin care, and oral and dental health. Naturactive, a department dedicated to herbal therapy, develops medicines and food supplements containing plants and substances of natural origin.

Source: Laboratoires Pierre Fabre

Contacts presse : Nathalie Barondiot, +33-01-49-10-83-80 / +33-06-18-00-35-59, nathalie.barondiot at pierre-fabre.com; Catherine de Rohan Chabot, +33-01-53-53-20-51 / +33-06-89-45-87-95, catherine.de.rohan.chabot at pierre-fabre.com