Pharmaceutical pricing adjustments: Are price binding regulations bypassed in cross-border online drug transactions?
The German Federal Court of Justice (BGH) has delivered a significant judgment (I ZR 74/24) on July 17, 2025, impacting pharmaceutical price regulation for online pharmacies in the European Union (EU). The case revolves around a Dutch online pharmacy offering bonuses for medication and prescriptions, which a Bavarian pharmacists' association argued violated German pharmaceutical price binding rules.
In a previous ruling, the Munich Higher Regional Court upheld the plaintiff's claims, stating that the bonuses contravened the price binding regulations stipulated in § 78 para. 1 sent. 4 AMG (old version). However, the BGH's judgment diverged from this, indicating that such price binding regulations may not apply to cross-border online sales within the EU. The court deems these regulations compliant with EU law, specifically the free movement of goods under Articles 34 and 36 of the Treaty on the Functioning of the European Union (TFEU).
The implications for the pharmaceutical industry are not fully foreseeable given that the full written judgment has not yet been published. The ruling emphasizes EU free movement of goods principles as boundaries against national price fixing in cross-border online pharmacy transactions.
Regarding the similar price binding regulation in § 129 para. 3 sent. 3 SGB V, which is a social law provision regulating pharmaceutical prices, pharmacists' associations expect that this social law regulation might still apply despite the BGH ruling. However, its precise applicability remains unclear and will likely be addressed in future court proceedings. The effect on the social law price fixing regulation remains unresolved, with potential for that regulation to continue applying domestically, pending further legal clarification.
The BGH's ruling contradicts the Munich Higher Regional Court decision, stating that the pharmaceutical price binding regulation in § 78 para. 1 sent. 4 AMG (old version) does not apply to online pharmacies based in other EU member states. The court referenced the European Court of Justice's (ECJ) judgment in "Deutsche Parkinson Vereinigung" (C-148/15), which identified the regulation as a measure equivalent to quantitative import restrictions under Article 36 TFEU.
The assertion that the health of the population would be jeopardized without fixed prices for medicinal products is not sufficiently supported, according to the BGH's ruling. The court ruled that empirical data or other means supporting the claim that fixed prices for medicinal products are necessary to maintain a safe and nationwide supply of medicinal products have not been provided in the case at hand.
The defendant has announced plans to resume offering bonuses in response to the judgment. No empirical data on the effects of standardized pharmacy prices on the nationwide, safe, and high-quality supply of medicinal products have been collected. The pharmacists' associations are hesitant about the continued applicability of the price fixing regulation introduced under social law.
In summary, the BGH ruling I ZR 74/24 limits the applicability of German pharmaceutical price binding rules to cross-border online sales, enhancing legal space for price-related incentives by online pharmacies in the EU. The ruling emphasizes EU free movement of goods principles as boundaries against national price fixing in cross-border online pharmacy transactions. The effect on the social law price fixing regulation (§ 129 para. 3 sent. 3 SGB V) remains unresolved, with potential for that regulation to continue applying domestically, pending further legal clarification. Special thanks to Luisa Jakobs for her support in writing this article.
[1] Further details and the full written judgment are awaited to assess the detailed implications for the pharmaceutical industry comprehensively.
- The BGH's judgment on July 17, 2025, in case I ZR 74/24, suggests that scientific research may be needed to substantiate the claim that fixed prices for medicinal products are essential for maintaining a safe and nationwide supply of medicinal products.
- The ruling on cross-border online sales within the EU, as delivered by the BGH, indicates that medical-conditions management and health-and-wellness initiatives could potentially expand through price-related incentives offered by online pharmacies operating within the EU, provided they comply with EU free movement of goods principles.
