FT : UK drugmakers accused of fixing price of life-saving NHS drug

UK drugmakers accused of fixing price of life-saving NHS drug
CMA alleges Actavis and Concordia made illegal non-compete agreements

The UK’s competition watchdog has accused two pharmaceutical companies of making illegal non-compete agreements to maintain artificially high prices for a life-saving drug.

The Competition and Markets Authority alleged on Friday that Actavis UK offered incentives to Concordia’s Amdipharm unit not to enter the market with its own competing version of hydrocortisone tablets.

It accused Actavis of supplying a fixed amount of its own 10mg tablets “for a very low price” so that Concordia could resell the product in the UK. Actavis was the sole supplier of the drug for more than three years until June last year, when the cost of the drug to the NHS rose from £49 to £88 a pack, the CMA said. 

The tablets are used to treat Addison’s disease and other problems with adrenal glands, which produce hormones particularly during times of stress. 

It is the second time in recent months that the CMA has said it would investigate Actavis over pricing. 

In a separate probe, the agency in December said Actavis had hiked the price of its unbranded 10mg hydrocortisone tablets by more than 12,000 per cent when compared with the branded version of the drug sold by another company in 2008. 

Andrew Groves, CMA senior officer, said the findings of the most recent investigation were provisional “and no conclusion should be drawn at this stage that there has in fact been any breach of competition law”.

But he noted that “anti-competitive agreements can cost the NHS, and ultimately the taxpayer, by stopping competition bringing down the cost of life-saving drugs like hydrocortisone tablets”. 

The UK arm of Actavis was recently sold by Israel’s Teva to Intas of India, while Amdipharm was acquired by Canada’s Concordia. 

Concordia on Friday rejected that Amdipharm was in breach of competition law and said it was co-operating with the CMA probe. 

Teva said that although it had acquired Actavis UK in August last year, it “has never in practice been controlled by Teva” due to competition obligations with the EU Commission. Intas declined to comment.

The agency has also recently set its sights on drugmakers more broadly, marking a new, more aggressive stance by the regulator. Michael Grenfell, the CMA’s director of enforcement, who was appointed in 2015, has promised to speed up investigations and make the agency more efficient. 

Last year US group Pfizer was fined a record £84m in the UK for charging excessive prices for a drug to treat epilepsy while GlaxoSmithKline and other generics manufacturers were fined £45m over the sale of paroxetine, an antidepressant. 

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