Drug firms colluded to hike essential medicine price by 1,800%, says UK watchdog

The UK’s competition watchdog has provisionally found three drug firms signed an illegal agreement, resulting in huge price hikes for an essential medicine used by the NHS.

The Competition and Markets Authority (CMA) has issued a “statement of objections”, saying that South Africa-based Aspen unlawfully agreed to pay two other firms, Amilco and Tiofarma, to stay out of the UK market for fludrocortisone acetate tablets.

Thousands of patients rely on this to treat primary or secondary renal insufficiency, commonly known as Addison’s Disease.

The CMA said the alleged illegal agreement protected Aspen’s UK monopoly on supply of the drug to the NHS, giving the firm the opportunity to increase prices by up to 1,800%.

According to the CMA’s provisional ruling Tiofarma and Amilco colluded with Aspen to allow it to maintain its monopoly.

In exchange Tiofarma was made sole manufacturer of fludrocortisone for direct sale in the UK, and Amilco received a 30% share of the increased prices that Aspen was able to charge.

Aspen has already admitted in August that it took part in the alleged arrangements, and should the CMA conclude there has been an infringement in a final ruling, Aspen has agreed to a maximum penalty of £2.1 million. Amilco and Tiofarma have made no admission.

The CMA has accepted a payment of £8 million to the NHS from Aspen, following a commitment made in August to resolve related competition concerns.

This related to Aspen buying a competitor fludrocortisone product from Tiofarma, an acquisition that brought all UK-approved fludrocortisone products under Aspen’s ownership.

When contacted by pharmaphorum Aspen’s deputy group chief executive Gus Attridge said in a statement: “The CMA’s announcement today does not provide new information but is rather a confirmation of the acceptance of the £8 million in commitments proposed by Aspen in August 2019.”

Attridge referred to details of the agreement with the CMA logged with the South African financial regulator in August.

He added that Aspen had “admitted liability for entering into an agreement to acquire a potential competitor fludrocortisone with the consequence that the conclusion of this agreement resulted in anti-competitive behaviour.”

pharmaphorum contacted Netherlands based Tiofarma for comment, while no contact details were immediately available for Amilco.