Investigation into alleged unfair pricing of drugs and medicines supplied to the NHS

cma investigate drug company pricing

The pharmaceutical sector has been investigated by the Competition and Markets Authority (CMA) for suspected breaches of competition legislation for alleged unfair pricing. The allegations of unfair pricing could have a severe knock-on effect on the NHS which is already in a vulnerable state.

The investigation into the unfair pricing was opened in October 2016. A large degree of scrutiny and information gathering is usually completed before the CMA will come to a definitive conclusion as to whether the pharmaceutical company have breached competition laws – namely Chapter II of the Competition Act (CA) and Article 102 of the Treaty on the Functioning of the European Union (TFEU).

The key issue here though is whether unfair pricing is needlessly costing the NHS too much. If so, the repercussions for this – given the state of our NHS – could be significant.

Pharmaceutical company allegedly charging excessively high prices

The pharmaceutical company in question is Concordia International RX (UK) Limited (Concordia) which is a subsidiary company of Concordia International Corporation. They reportedly have a portfolio of delivering pharmaceutical products to patients in over 100 countries.

It’s alleged that Concordia is charging excessive prices in the supply of certain pharmaceutical products, with one of their biggest clients being the NHS. According to the Guardian, Concordia has risen 32 drug prices by more than 1,000% in the past 5 years. One example of a price hike is of the cost of fusidic acid eye drops for bacterial conjunctivitis which rose from £2.09 in May 2013 to £29.06 in April 2016.

Impact on the NHS

With the NHS “on the brink of breakdown”, inflated drug and medicine prices is certainly not what they need right now. It’s no secret that cuts and underfunding to the NHS has placed them in a more vulnerable state, and higher prices for drugs could mean even less resources and/or funding in other key areas of NHS services.

Costs need to be kept down in the NHS without compromising on the quality of care. How is this possible if the NHS are being grossly overcharged for drugs?

Are patients at risk?

If the alleged unfair pricing from Concordia is found to have had a negative impact on the NHS, and the UK’s health system has been forced to pay inflated prices, there’s no shadow of a doubt that the rest of the health system could easily have suffered. If the NHS has to pay inflated prices, compromises may need to be made elsewhere.

The unnecessary diversion of funds together with NHS cuts undoubtedly puts patients at risk. This concern was highlighted by the Trades Union Congress’ (TUC) report Patient Safety: warnings from all sides. The diversion and funding cuts may mean temporary ward closures which clearly endanger lives.

Frances O’Grady, the TUC’s General Secretary, reiterates the negative impacts on patients:

“…each month we are seeing patient safety put at risk by staff shortages, longer waiting times and cuts to services… you cannot deliver a world-class health service on the cheap.”

If unnecessary diversion of funds have been made as a result of Concordia’s alleged breach, the impact on the quality of services could be huge.

Measures need to be taken

Pharmaceutical companies Pfizer and Flynn Pharma were found to have breached UK and Competition laws for their ‘excessive and unfair prices’. It’s about time wealthy corporations are stopped for charging excessive prices that can have a degrading impact on the NHS and patients…

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