EU probes Aspen price gouging allegations

The European Commission is to investigate into whether South Africa's Aspen abused a dominant market position by raising the price of a group of generic cancer drugs.

Pharma pricing is already under scrutiny in the US, where president Trump has vowed to take action against high drug prices.

But now authorities across the Atlantic are also concerned over so-called “price gouging”, where companies impose significant price rises for badly needed drugs.

The investigation concerns Aspen's pricing practices for niche medicines containing the active pharmaceutical ingredients chlorambucil, melphalan, mercaptopurine, tioguanine and busulfan. The medicines in question are used for treating cancer, such as haematologic tumours.

They are sold with different formulations and under multiple brand names. Aspen acquired these medicines after their patent protection had expired.

The Commission said it will investigate information indicating that Aspen has imposed very "significant and unjustified" price increases of up to several hundred percent.

In a statement the Commission says it has information that to impose such price increases, Aspen has in some cases threatened to withdraw the medicines in question in some member states and has actually done so in certain cases.

This could breach EU antitrust rules forbidding the imposition of unfair prices or unfair trading conditions on customers.

The investigation will cover all of the European Economic Area except Italy, where authorities already adopted an infringement decision against Aspen in September.

In a brief statement on its website, Aspen acknowledged the European Commission's investigation.

It said in the statement: “While Aspen is not currently in a position to comment on these proceedings, it reaffirms its commitment to fair and open competition in markets in the European Union and around the world. Aspen takes compliance with competition laws very seriously and will work constructively with the European Commission in its process.”

In the UK, new legislation is being finalised with the aim of preventing companies from exploiting scarcity in the generic drug market to raise prices, after numerous such cases.