Aspen and EC strike deal to cut prices of off-patent cancer medicines
ASPEN Pharmacare said yesterday it had reached a deal with the European Commission to reduce prices for six off-patent cancer medicines by 73 percent in Europe, addressing excessive pricing concerns.
The commission opened an investigation into Aspen in 2017 following concerns that Aspen might have abused its dominant position by imposing unfair prices in accordance with Article 102(a) Treaty on the Functioning of the European Union and Article 54 of the European Economic Area Agreement.
However, Aspen said yesterday it had disagreed with the commission’s preliminary assessment last year in July, but in order to meet the commission’s competition concerns, the group proposed commitments to the commission that would be satisfactory to all the parties involved.
The proposed commitments of last year, which became binding agreements yesterday, involved Aspen cutting its prices by between 27 and 79 percent, resulting in an average of 73 percent reduction a product in the European Economic Area (EEA), excluding Italy.
Aspen said it would maintain the reduced prices for ten years and guarantee supply for at least five years. “After five years, should Aspen wish to cease commercialising any of the products it will make them available for sale to a third party, or absent an interested purchaser, maintain the marketing authorisations,” the group said.
Aspen said it would make a onetime payment to the relevant entities responsible for reimbursement of medicines and other beneficiaries as appropriate to bridge the implementation of the price reductions.
“This payment is in line with the €24 million (R430m) that Aspen had provided in respect of this matter in its financial statements for the year to end June 2020,” the group said.
Executive Vice-President Margrethe Vestager, in charge of competition policy at the European Commission, said yesterday: “As a result of today’s (yesterday’s) decision, Aspen has to radically reduce its prices across Europe for six medicines that are essential to treat certain serious forms of blood cancer, including myeloma and leukaemia. “Some patients, including young children, depend on these medicines for their treatment. Aspen’s commitments will save European health systems many dozens of million euros and will ensure that these crucial medicines remain available. Today’s (yesterday’s) decision gives a strong signal to other dominant pharmaceutical companies not to engage in abusive pricing practices to exploit our health systems,” she said.
Aspen said it was pleased that the commission has accepted the binding commitments resulting in the resolution of this matter.
“Aspen is focused on ensuring supply and access to quality, affordable pharmaceuticals for our patients.
“This object has been achieved over many years and is reflected in the role it has played in saving millions of lives across Africa through pioneering and supplying generic antiretroviral medicine for the treatment of HIV/Aids,” the group said.
The group added that the current Covid-19 crisis had demonstrated the importance of governments and companies in co-operating to prioritise access to pharmaceuticals.
“Aspen, as a leading supplier of anaesthetics, thrombosis treatments and most recently dexamethasone, has and will continue to work closely with authorities to ensure the supply of medically critical products throughout the world, including in the EEA,” the group said.
Aspen shares closed 0.16 percent higher at R143.23 on the JSE yesterday.