Drugmakers colluded to drive up price of anti-nausea drug by 700%
pharmafile | May 23, 2019 | News story | Business Services, Medical Communications | Business, NHS, collusion, competition, pharma
Four pharmaceutical firms have been accused of illegally colluding to restrict the supply of anti-nausea medication Prochlorperazine after the price of the drug increased by 700%.
The price of Prochlorperazine increased from £6.49 per pack to £51.68, between 2013 and 2018, after four drugmakers agreed not to compete.
The price increases led to the NHS paying nearly £5 million a year more for the drug, as the annual cost increased from £2.7 million a year in 2013 to £7.5 million a year in 2018. This was despite the fact the NHS prescribed fewer packs during that period.
The Competition and Markets Authority (CMA) claims four companies – Alliance, Focus, Lexon and Medreich – colluded to increase the price of the treatment, which is often given to cancer patients undergoing chemotherapy.
The CMA alleges that Alliance supplied Focus with Prochlorperazine on an exclusive basis. Focus then paid Lexon a share of the profits. In turn Lexon paid Medreich.
Before they had reached this agreement Lexon and Medreich had been planning to launch their own version of Prochlorperazine which would have competed against Alliance’s drug.
Alliance said in a statement that it had “no involvement in the pricing or distribution of Prochlorperazine since 2013, when it was out-licensed by the company to Focus Pharmaceuticals Limited on an exclusive basis as is normal market practice.”
Ann Pope from the CMA said: “Agreements where a company pays a rival not to enter the market can lead to higher prices and deprive the NHS of huge savings that often result from competition between drug suppliers.”
“The NHS should not be denied the opportunity of benefitting from an increased choice of suppliers, or lower prices, for important medicine.”
Louis Goss
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