NHS ‘conned by firms that hiked drug price from £6.49 to £51.68’
FOUR pharmaceutical firms were yesterday accused of conspiring to raise the price of a drug, ripping off the NHS to the tune of up to £5million a year.
A provisional ruling by the Competition and Markets Authority said the British firms broke competition laws to artificially drive up the cost of antinausea pills to the NHS.
The CMA says the four companies – Alliance Pharma, Focus Pharmacy, Lexon and Medreich – agreed not to compete for the supply of the drug and watched the price rise 700 per cent in four years.
The watchdog said the price paid by the NHS for Prochlorperazine – a sickness pill used to treat the symptoms of vertigo, migraines and travel sickness – soared from £6.49 per pack of 50 in December 2013 to £51.68 in December 2017.
From 2014 to 2018, the annual costs
‘Motivated by pure greed’
incurred by the NHS for the drug increased from around £2.7million to around £7.5million, even though the number of packs dispensed fell. The companies can now appeal but if the CMA confirms its ruling they could each be fined up to 10 per cent of their turnover.
Last night a Department of Health spokesman said: ‘Deliberately conspiring to deprive innocent patients of vital medicine to maximise profit is an act motivated by pure greed and one we condemn.
‘It’s appalling for any company to rip off our NHS. Patients must have access to cost-effective medicines at a price we can afford.’
The ruling is the latest accusation that companies allegedly artificially boost the price of generic drugs. In the UK there is strict price regulation around branded drugs to make sure firms that own the patent do not charge what they like.
But as soon as a drug comes to an end of its patent the price regulation is lifted. Anybody can then make the drug, so market and competition forces should, in theory, drive down the price. But when the companies allegedly agreed that Lexon and Medreich would stay out of the market in 2013, they ensured Focus Pharmacy was the only company selling the drug, so it was free to put up the price.
The CMA said the NHS was deprived of ‘ huge savings that often result from competition between suppliers’. It said Alliance Pharma, which manufactures the drug through a contractor, supplied Prochlorperazine exclusively to Focus Pharmacy, which sold it to the NHS. Lexon and Medreich agreed not to compete for the supply of the drug– and were paid a share of the profits in return.
Alliance Pharma denied the accusations, insisting it had no knowledge of any anti-competitive agreements and had not benefited from any price increases.
Advanz Pharma has taken over Focus Pharmacy. Advanz said the allegations pre- date its involvement with Focus, but added: ‘We do not believe that competition law has been infringed.’
Lexon and Medreich did not respond to requests for comment.