Two pharma companies are being investigated for potentially overcharging the NHS by millions of pounds for an anti-epilepsy drug.
The Competition and Markets Authority (CMA) said Pfizer and Flynn Pharma may have abused their dominant position in the market and charged ‘excessive and unfair’ prices for phenytoin sodium capsules.
Pfizer is alleged to have sold the drug at inflated prices to Flynn Pharma – which distributes it to wholesalers and pharmacies – since the drug went off patent.
In its Statement of Objections, the CMA said that the price to Flynn Pharma was eight to 17 times higher than when the drug was sold under the brand name Epanutin in the UK, up to September 2012. Flynn Pharma has then been selling the drug on at prices between 25 and 27 times higher than those historically charged, it claims.
The NHS spent over £40m on phenytoin sodium last year, compared with an annual spend of £2.3m prior to September 2012, the CMA said.
Ann Pope, senior director of antitrust enforcement at the CMA, said: ‘The prices that the CMA is concerned about in this case are very high compared to those prices previously charged and have led to a big increase in the total NHS drug bill for what is a very important drug for tens of thousands of patients.
‘The CMA’s findings on dominance and abuse are provisional and no conclusion can be drawn at this stage that there has, in fact, been any breach of competition law. We will carefully consider any representations from Pfizer and Flynn Pharma before deciding whether the law has been infringed.’
Pfizer said in a statement: ‘Ensuring a sustainable supply of our products to UK patients is of paramount importance to Pfizer and was at the heart of our decision to divest the product. Pfizer is co-operating fully with the CMA’s ongoing investigation.
‘The Statement of Objections is the CMA’s provisional findings only and all parties will now have the opportunity to respond to the statement before the CMA decides if there has been any infringement.’
David Walters, director of Flynn Pharma, said: ‘I confirm that Flynn is an addressee of a Statement of Objections (SO) from the CMA. The SO does not prejudge the final outcome of the proceedings and addressees of the SO have the right to reply to the CMA’s allegations. Flynn intends to cooperate fully with the CMA in this matter and to vigorously defend itself against the allegations.’