The UK Competition and Markets Authority has ruled that several drugmakers worked together to raise the NHS price of widely-used nausea drug prochlorperazine, fining them £35 million ($47.5 million).
Alliance Pharmaceuticals, Lexon, Medreich, and former and current owners of Focus – Advanz and private equity group Cinven – were involved in an agreement to fix the market for soluble prochlorperazine tablets, and raised the price they charged the NHS by 700%.
Between 2013 and 2017, the price of a 50-tablet pack of prochlorperazine increased from £6.49 to £51.68, according to the CMA, raising the amount sent on the drug by the NHS from around £2.7 million to about £7.5 million, even though the number of packs dispensed fell over the period.
All of the drugmakers involved have been fined in a past for breaking competition laws, said the regulator and, in the case of both Advanz and Cinven this is the first time that a company has been fined by the CMA in three separate investigations.
The CMA claims Alliance appointed Focus as its distributor for prochlorperazine, also used to treat dizziness and migraines, and Lexon and Medreich were given a share of the profits from sales of the drug after agreeing not to compete in the supply of soluble prochlorperazine tablets in the UK.
Medreich obtained a licence to supply prochlorperazine in January 2014, but did not start to supply the product until late 2017.
Alliance has been fined £7.9 million for its part in the collusion, with Lexon and its holding company collectively fined £7.3 million and Medreich plus various affiliates given a £4.6 million penalty.
Focus – along with Cinven and Advanz and other associates – are bearing the brunt of the CMA’s judgment, and are in line to pay £15.45 million.
“The size of the fines reflects the seriousness of this breach,” said CMA chief executive Andrea Coscelli.
“These firms conspired to stifle competition in the supply of this important medication, so that the NHS – the main buyer of the drugs – lost the opportunity for increased choice and lower prices,” he added. “All firms should know that we will not hesitate to take action like this against any businesses that collude at the expense of the NHS.”
The latest investigation is one of a number of excessive pricing and pay-for-delay schemes being investigated by the CMA as part of a clampdown on the pharma sector, including a probe of the price of antidepressants and other drugs during the pandemic.
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