Pharma company has been accused by CMA of overcharging the NHS

The Competition and Markets Authority (CMA) has released a statement alleging that drug company, Concordia, has abused its position with the NHS to overcharge for liothyronine tablets — an essential thyroid drug.

Following its investigation into the pricing of the drug, the CMA found that the company had charged the NHS more than £34 million last year, which had increased from £600,000 in 2006. Per pack, the investigating authority found that the company had increased the cost from around £4.46 in 2007 (before the drug was de-branded) to £258.19 by July this year. This represents an increase of around 6,000%.

“Pharmaceutical companies which abuse their position and overcharge for drugs are forcing the NHS – and the UK taxpayer — to pay over the odds for important medical treatments,” asserted CMA chief executive, Andrea Coscelli. “We allege that Concordia used its market dominance in the supply of liothyronine tablets to do exactly that.

“At this stage in the investigation, our findings are provisional and there has been no definitive decision that there has been a breach of competition law. We will carefully consider any representations from the companies before deciding whether the law has in fact been broken.”

The CMA has issued a Statement of Objections (SO) to Concordia, as well as to Cinven and HgCapital — private equity firms and previous owners of entities now forming part of Concordia. All now have an opportunity to respond to the provisional findings set out in the SO.

This is one of a number of CMA cases in the pharmaceutical sector, including a recent fine against Pfizer and Flynn Pharma of nearly £90m in relation to excessive and unfair prices for anti-epilepsy treatment, phenytoin sodium capsules, in respect of which the CMA’s decision is currently under appeal. Additionally, the CMA also fined a number of pharmaceutical companies a total of £45 million in relation to anti-depressant medicine paroxetine; that decision is also under appeal.

The CMA has reported that is pursuing another seven investigations into several companies in relation to drug pricing and competition issues.