CMA RULING

PHARMACEUTICAL companies have been fined £260million after overcharging the NHS for life-saving drugs for almost a decade.

UK firms increased the price of hydrocortisone by more than 12,000 per cent and paid would-be rivals to stay out of the market, the Competition and Markets Authority (CMA) found.

The watchdog said Auden Mckenzie and Actavis UK, now known as Accord-UK, charged “excessively high prices” for the pills, used to treat adrenal insufficiency. The cost of a pack rose from 70p in 2008 to £88 by 2016 – a 12,471 per cent increase.

Meanwhile, NHS spending on the drug, which is taken by tens of thousands – including for the life-threatening condition Addison’s disease – rose from £500,000 a year to £80million.

Andrea Coscelli, chief executive of the CMA, 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.” The firms exploited the fact that de-branded drugs are not subject to NHS price regulation, enabling them to increase their prices without constraint.

Auden Mckenzie bought the licences for hydrocortisone and launched generic versions in 2008. It paid off rivals AMCo, now Advanz Pharma, and Waymade. Actavis UK took over the business in 2015 and continued paying off AMCo to stay out of the market.

The CMA said: “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. These were egregious breaches of the law that artificially inflated the costs faced by the NHS, reducing the money available for patient care.

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

The regulator said that Accord-UK will be liable for £65.6million of the fine, while former parent company Allergan is solely liable for £109.1million. The pair are also jointly liable for £2million.

Accord-UK, Accord Healthcare and the current parent company Intas are jointly and severally liable for £44.4million, the CMA said. There is a total fine of £42.8million for AMCo, while Waymade will be required to pay £2.5million.

The CMA’s decision also means the NHS will be able to seek damages for the firms’ behaviour. Accord said it is “disappointed” by the ruling and intends to appeal.