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South Africa’s over-charging case against Aspen dissolves, remains against big names

Published on 06/10/17 at 08:33am

South Africa’s Competition Commission has admitted that there is no case to be heard against Aspen and Equity, in regards to an investigation into their pricing practices.

It was found, as Aspen had initially claimed, that its prices had averaged an increase of 6.25% per year since 2009.

Aspen had been caught in hot-water regarding its sales practices in Italy, where it had aggressively hiked prices of its cancer drugs and was fined €5.2 million, as a result. It is thought that the South Africa-based company’s reputation from this episode may have been partly responsible for it being drawn into the investigation.

The commission released a statement justifying its action: "Based on the information gathered to date‚ the Commission has decided to drop the investigation against Aspen because an excessive pricing case cannot be sustained against them."

The exoneration of Aspen comes at a good time for the company, as it recently posted its annual revenues had increased by 16%. It largely attributed this change to the acquisition of AstraZeneca and GSK’s anaesthetic portfolio.

On the other side of the investigation are Pfizer, Roche and Genentech. All are still under continuing investigation over its pricing of drugs in South Africa.

Pfizer was revealed to be under investigation for the pricing of lung cancer treatment, crizotinib, which costs 152,000 rand (£8,488) per 250mg. The drug is not registered in South Africa and is only available through a special license.

Roche, for its part, is under investigation for Herceptin – a treatment that costs approximately 500,000 rand (£27,931) for a year’s worth of treatment. Genentech is the distributor of the drug.

The cost of both treatments has been deemed too high to be sustainable in South Africa. Roche has since indicated that it will reduce the price of the treatment, but this has not yet taken place.

Ben Hargreaves

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