Drug firms fined £260m by watchdog for overcharging the NHS

The UK competition watchdog has hit several drug makers with fines totalling more than £260m after they overcharged the NHS for hydrocortisone tablets.

The Competition and Markets Authority (CMA) said on Thursday that pharmaceutical firms Auden Mckenzie and Actavis UK, now known as Accord-UK, used their position as sole providers of the drug to inflate its price for almost a decade.

It said the price of the drugs was increased by 10,000% against the price of the branded drug, under its previous owner, in 2008.

What these pills are used for

Hydrocortisone pills are used by tens of thousands of people across the UK to treat adrenal insufficiency, which includes life-threatening conditions such as Addison’s disease.

CMA investigate

Investigations by the CMA found that the amount the NHS had to pay for a single pack of 10mg tablets rose from 70p in April 2008 to £88 by March 2016. Chief executive of the CMA Andrea Coscelli, 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 regulator also said that Auden Mckenzie paid off would-be competitors AMCo (now known as Advanz Pharma) and Waymade to stay out of the market.

Actavis UK continued paying off AMCo after taking over sales of hydrocortisone tablets in 2015

Coscelli added:

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.

In practice, the NHS was at one point being charged over £80 for a single pack of tablets that had previously cost less than £1.

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.

Fines

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

Accord-UK, Accord Healthcare and the current parent company Intas are jointly and severally liable for £44.4m, the CMA said.

It added that there is a total fine of £42.8m for AMCo, while Waymade will be required to pay £2.5m.