Firms fined GBP260mln over 10,000% rise in price of NHS drugs

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A group of companies including Irish drug giant Allergan PLC (NYSE:AGN) and private equity group Cinven have been fined more than GBP260mln for rigging prices of hydrocortisone drugs sold to the NHS.


Ther UK Competition and Markets Authority (CMA) said two companies in particular – Auden Mackenzie and Actavis UK (now called Accord-UK) – charged the NHS excessively high prices for almost a decade.


To protect its position, Auden Mackenzie also paid off competitors to keep them out of the market as the price of hydrocortisone tablets rose by 10,000%.


Andrea Coscelli, the CMA’s chief executive, said: “These are without doubt some of the most serious abuses we have uncovered in recent years. The actions of these firms cost the NHS – and therefore taxpayers – hundreds of millions of pounds.


“Auden Mckenzie’s decision to raise prices for de-branded drugs meant that the NHS had no choice but to pay huge sums of taxpayers’ money for life-saving medicines.


“In practice, the NHS was at one point being charged over GBP80 for a single pack of tablets that had previously cost less than GBP1.”


Accord-UK and, for their ownership periods, its parent companies Intas and Accord and its former parent firm Allergan, have been fined GBP155mln for charging the NHS excessive and unfair prices, he added.


Accord-UK and Allergan were also fined a further GBP66mln for paying two other companies, Waymade and AMCo, to stay out of the market.


For their part in the collusion, Advanz and its former parent Cinven have been fined GBP43mln while Waymade has received a GBP2.5mln penalty.


The illegal non-compete agreements were in place for approximately 4 years each, said the CMA.


“”These were egregious breaches of the law that artificially inflated the costs faced by the NHS, reducing the money available for patient care,” added Coscelli.


“Our fine serves as a warning to any other drug firm planning to exploit the NHS.”

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