UK fines Pfizer for 2,600% drug price hike
British regulators fined United States drugmaker Pfizer and distributor Flynn Pharma a record £89.4 million (US$112.7 million) Wednesday for increasing the cost of an epilepsy drug by as much as 2,600 per cent.
Pfizer and Flynn Pharma charged "excessive and unfair prices" for the drug used by 48,000 people in Britain, the Competition and Markets Authority said. Pfizer was fined £84.2 million and Flynn Pharma £5.2 million.
"This is the highest fine the CMA has imposed, and it sends out a clear message to the sector that we are determined to crack down on such behaviour and to protect customers, including the National Health Service, and taxpayers from being exploited," Philip Marsden, chairman of the case decision group for the investigation, said in a statement.
The authority said the companies removed the official brand of Epanutin, Pfizer's name for phenytoin sodium capsules, so they could increase the price. As a result, the National Health Service saw the bill for drug increase to £50 million in 2013, from £2 million in 2012.
"The companies deliberately exploited the opportunity offered by de-branding to hike up the price for a drug which is relied upon by many thousands of patients," Marsden said.
Pfizer rejected the ruling, saying that Epanutin was a loss-making product and the deal with Flynn Pharma helped secure supplies of the drug for patients. It plans to appeal, as does Flynn Pharma.
"In this transaction, and in all of our business operations, we approached this divestment with integrity and believe it fully complies with the established
competition law," Pfizer said.
Pfizer said the increased price of the drug was still 25 per cent to 40 per cent lower than the cost of an equivalent medicine by another supplier to the NHS.
"The ruling highlights real policy and legal issues concerning the respective roles of both the Department of Health and the CMA, in regulating the price of pharmaceutical products in the UK," the company said. "Pfizer will seek clarity on these issues as part of the appeal process."