Regulator to investigate drug companies that charge NHS ‘excessive prices’

NHS signage

The competition watchdog has launched an investigation into drug companies suspected of charging the NHS excessive prices. Any company found to have broken the law could face fines of up to 10% of its global turnover.

While the Competition and Markets Authority would not reveal how many companies were involved in the investigation into suspected unfair pricing, pharmaceutical company Concordia International has revealed that it is part of the inquiry.

A Concordia statement says it is “working cooperatively to better understand the CMA’s position and we will continue to work constructively to resolve the matter”.

“There has been speculation in the press about these issues and this affords us the opportunity to have an objective discussion about our products and their contribution to the healthcare system,” the statement adds.

The CMA investigation into suspected breaches of competition law was launched on 25 October 2016 and will gather initial evidence before a decision is made as to whether or not to proceed further by February 2017.

Health secretary Jeremy Hunt called for the CMA to investigate in June 2016 after an investigation by The Times claimed companies were ripping off the NHS by buying the rights to old drugs and dropping existing brand names[1]

The newspaper alleged that by “exploiting a loophole”, the companies were able to avoid a cap on profits and raise prices by thousands of per cent without competition from rivals.

Information about the case, set out on the CMA website, states: “The investigation is under Chapter II of the Competition Act 1998 (CA98) and Article 102 of the Treaty on the Functioning of the European Union (TFEU).

“The investigation relates to suspected unfair pricing by way of charging excessive prices in the supply of certain pharmaceutical products, including to the National Health Service.” 


[1] Kenber B. Extortionate prices add £260m to NHS drug bill. The Times. 3 June 2016.

Last updated
The Pharmaceutical Journal, PJ, November 2016, Vol 297, No 7895;297(7895):DOI:10.1211/PJ.2016.20201874

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