Drug firm accused of breaking competition law by charging 'unfair' prices

A pharmaceutical company that allegedly marked up the price of a life-saving drug by over 12,000% has been accused of taking advantage of the lack of alternatives available to the NHS.

Actavis UK is accused of breaking competition law in the UK by charging "excessive and unfair prices" for tablets in a statement of objections issued to the company by the CMA.

The amount it charged the NHS for unbranded 10mg hydrocortisone tablets snowballed from 70p in April 2008 to £88 per pack by March 2016, the UK's primary competition and consumer authority revealed.

The watchdog also alleges the price of 20mg hydrocortisone tablets in March 2016 had soared to nearly 100 times as much as the branded version sold by a different company before 2008. De-branded drugs are not subject to price regulation.

The pills are used as replacement therapy for people whose adrenal glands do not produce enough steroid hormones, such as in Addison's disease, which is life-threatening.

Andrew Groves, the regulator's senior responsible officer, said: "This is a life-saving drug relied on by thousands of patients, which the NHS has no choice but to continue purchasing.

"We allege that the company has taken advantage of this situation and the removal of the drug from price regulation, leaving the NHS - and ultimately the taxpayer - footing the bill for the substantial price rises."

The CMA said its findings were provisional and it will hear from representations of the parties under investigation before determining whether the law has been infringed.

If a case decision group decides it has, the CMA may impose a financial penalty of up to 10% of the company's annual worldwide group turnover.

The case against Actavis UK is the latest in a string of investigations against drugs companies by the regulator.

Last week, the CMA fined the pharmaceutical suppliers Pfizer and Flynn Pharma a total of nearly £90 million for charging excessive prices for the anti-epilepsy drug phenytoin sodium, after that drug was also de-branded.

And in February the CMA fined a number of pharmaceutical companies a total of £45 million for anti-competitive agreements and conduct in relation to the supply of the anti-depressant paroxetine.