Free trade between European countries is enshrined in the Treaty of Rome. But some pharmaceutical companies like Pfizer don't like free trade: they'd much prefer to keep national markets separate. They argue that pharmaceuticals aren't like other products. They complain that some European governments, most commonly Spain, impose price controls on pharmaceuticals. With this claim, they argue that European free trade in drugs should be banned.

The European Commission, however, has rubbished the price-controls claim. The Commission has pointed out that:

factual evidence shows that [Glaxo] does not simply accept prices set by the Spanish authority. There is always negotiation and for four products which are prime candidates for parallel trade, [Glaxo] has even negotiated price increases with the Spanish authorities.

Furthermore, the Commission has pointed out that:

...there does not appear to be any causal link between the losses due to parallel trade and [Glaxo's] R&D investments. Moreover, these losses are too insignificant to affect these investments to a considerable extent. Finally, it must be stressed that the R&D budget of pharmaceutical companies while important only represents around 15% of their total budget.

And as the Pharmopoly campaign has pointed out:

This can not be emphasised often enough: Europe does not have price controls, it has big customers who, like the U.S. Veterans Administration, obtain volume discounts from the pharmaceutical suppliers and negotiate lower prices. [Talking of] price controls, which do not actually exist, makes no sense. Buyers negotiate with sellers in the market-place every day. Big customers get big discounts; the U.S. army can buy Humvee vehicles cheaper than retail customers because they are the biggest buyers of military vehicles in the world, Wal-Mart pays low prices for coffee because it is the biggest retailer of coffee in the world and Britain's NHS negotiates keen drug prices because it buys nearly $20 billion of pharmaceuticals every year.