UK Watchdog Finds Concordia Guilty of Market Abuse

30.11.2017 -

In a provisional ruling announced on Nov. 21, the UK’s Competition and Markets Authority (CMA) has found that Canadian pharma Concordia abused its dominant position to overcharge the National Health Service (NHS) by millions of pounds for liothyronine, a thyroid drug.

The CMA noted that the cost per pack rose from about £4.46 before it was debranded in 2007 to £258.19 by July 2017, an increase of nearly 6,000%, while production costs remained “broadly stable.” As a consequence, the NHS saw its costs for buying the drug soar from just £600,000 in 2006 to more than £34 million in 2016.

Until earlier this year, Concordia was the only UK supplier of liothyronine tablets, which are mainly used to treat hypothyroidism, a condition caused by a deficiency of thyroid hormone.

“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,” said CMA chief executive, Andrea Coscelli. “We allege that Concordia used its market dominance in the supply of liothyronine tablets to do exactly that.” She did stress, however, that the findings at this stage were provisional.

Concordia said it does not believe that competition law has been infringed. “The pricing of liothyronine has been conducted openly and transparently with the Department of Health in the UK over a period of 10 years. Over that time, significant investment has been made in this medicine to ensure its continued availability for patients in the UK, to the specifications required by the Medicines and Healthcare products Regulatory Agency in the UK,” the company stated, adding that it would review the CMA’s preliminary position and respond in detail.

This is the second time this year that Concordia has found its pricing practices under the CMA’s spotlight. In March, the watchdog accused Concordia and Actavis UK of breaking UK competition law by artificially lifting the cost of hydrocortisone tablets to the NHS with a deal that delayed competition to the drug.

The CMA said it continues to pursue another seven investigations into several companies in relation to drug pricing and competition issues, although it gave no further details.

In February, the authority imposed a record fine of £84 million against Pfizer and Flynn Pharma in relation to excessive pricing for phenytoin sodium capsules, a treatment for epilepsy. Both companies have appealed.

In addition, several other drugmakers were fined a total of £45 million by the CMA in February 2016 for anti-competitive behavior relating to the anti-depressant paroxetine. The companies concerned included GlaxoSmithKline, Generics UK, Merck KGaA, Alpharma, Actavis UK and Xellia Pharmaceuticals. That decision is also under appeal.