The UK’s competition regulator has made a provisional finding in the longstanding investigation into drug price hikes, and the outcome is damning.
Issues surrounding pharmaceutical competition breaches are numerous and serious. At the end of the day, the consumer in these cases is patients and the NHS; that’s our tax money.
Any infringement of vital competition laws when it comes to medical matters should always lead to significant punishments, and the work of the CMA (Competition and Markets Authority) in this area is incredibly important. The provisional finding in this matter accompanies an admission from one of the companies involved as well.
Statement of objections issued
The CMA issued a statement of objection in October 2019 relating to their investigations into alleged drug price hikes in the UK.
The provisional view is that pharmaceutical company Aspen allegedly agreed to make unlawful payments to two other companies in order for them to effectively stay out of the market. This could then allow them to keep prices – and therefore profits – high with there being no competition to have to deal with
The companies who are believed to have received payments are Amilco and Tiofarma.
Impact of the drug price hikes case
The impact of drug price hikes can mean that patients and the NHS are having to pay more for their medication. In this case, the drug in question is fludrocortisone acetate tablets, which is a prescription-only medication.
It’s alleged that the three companies signed an illegal agreement in order to allow Aspen to protect a monopoly in relation to the supply of the drug to the NHS. It’s also understood to have allowed them to hike the price of the drug up by 1,800%,
The alleged agreements between them reportedly allowed Tiofarma to be the sole manufacturer for direct sale in the UK, and Amilco allegedly received a 30% share of the increased prices that Aspen charged. These kinds of arrangements are in breach of vital competition law, and when infringements involve our NHS and taxpayers’ money, it’s harder to stomach.
Aspen’s admission
The statement of objections issued in the drug price hikes case actually follows an admission from Aspen that it took part in allegedly anti-competitive agreements.
Where the CMA ultimately reaches a solid conclusion of an infringement, it’s understood that Aspen has already agreed to pay a maximum fine of £2.1m. As of yet, no admissions have been received from Amilco and Tiofarma.
There are also additional related commitments to pay the NHS £8m and to ensure that there will be at least two suppliers of fludrocortisone in the UK in the future.