For the role that Pfizer played in ramping up the cost of an epilepsy drug by as much as 2,600 percent, the company has been slapped with a record 84.2 million pounds ($107 million) by Britain's competition watchdog.
Following a dramatic price hike in 2012, a fine of 5.2 million pounds was also slapped for overcharging for phenytoin sodium capsules on Flynn Pharma by the Competition and Markets Authority (CMA).
The ethics of price hikes for old off-patent medicines that are only made by a few firms and where there is little competition have been debated veraciously on both sides of the Atlantic and the CMA's ruling comes amid such a growing debate on the issue that has impacted a large number of people.
By raising the U.S. price of Daraprim, an old anti-infective drug, by more than 5,000 percent to $750 a pill last year, a huge hue and cry and outrage in the U.S. was created against U.S. drugmaker Turing Pharmaceuticals, led at the time by hedge fund manager Martin Shkreli.
In the case of phenytoin sodium capsules, before reducing to 54.00 from May 2014, the UK price charged for 100 mg packs of the drug jumped from 2.83 pounds to 67.50 in 2012.
The annual spending by Britain's National Health Service rose from 2 million pounds in 2012 to about 50 million in 2013 due to the buying of the capsules, the prices of which were raised exponentially. UK prices were many times higher than elsewhere in Europe, the CMA said.
In September of 2012, the rights of the medicine were sold to Flynn, a privately owned British company, for the medicine under the brand name Epanutin that used to be produced by Pfizer.
Soon after the sale, the price soared as the medicine was then debranded, meaning that it was no longer subject to price regulation.
"The companies deliberately exploited the opportunity offered by debranding to hike up the price for a drug which is relied upon by many thousands of patients," Philip Marsden, chairman of the CMA's case decision group, said on Wednesday.
"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."
It planned to appeal all aspects of the CMA's verdict, Pfizer said in a statement.
The U.S. drugmaker said that it was forced to consider whether it could continue supplying the medicine since it had been loss-making for the company. Compared to the costs of an equivalent tablet form from another supplier, the price that was set by Flynn was actually 25 to 40 percent less, Pfizer added in the statement.
Plans to appeal against the verdict are also being made by Flynn. Punishing Flynn for selling phenytoin capsules for less than phenytoin tablets "beggars belief", said the Chief executive of the company, David Fakes.
(Source:www.reuters.com)
Following a dramatic price hike in 2012, a fine of 5.2 million pounds was also slapped for overcharging for phenytoin sodium capsules on Flynn Pharma by the Competition and Markets Authority (CMA).
The ethics of price hikes for old off-patent medicines that are only made by a few firms and where there is little competition have been debated veraciously on both sides of the Atlantic and the CMA's ruling comes amid such a growing debate on the issue that has impacted a large number of people.
By raising the U.S. price of Daraprim, an old anti-infective drug, by more than 5,000 percent to $750 a pill last year, a huge hue and cry and outrage in the U.S. was created against U.S. drugmaker Turing Pharmaceuticals, led at the time by hedge fund manager Martin Shkreli.
In the case of phenytoin sodium capsules, before reducing to 54.00 from May 2014, the UK price charged for 100 mg packs of the drug jumped from 2.83 pounds to 67.50 in 2012.
The annual spending by Britain's National Health Service rose from 2 million pounds in 2012 to about 50 million in 2013 due to the buying of the capsules, the prices of which were raised exponentially. UK prices were many times higher than elsewhere in Europe, the CMA said.
In September of 2012, the rights of the medicine were sold to Flynn, a privately owned British company, for the medicine under the brand name Epanutin that used to be produced by Pfizer.
Soon after the sale, the price soared as the medicine was then debranded, meaning that it was no longer subject to price regulation.
"The companies deliberately exploited the opportunity offered by debranding to hike up the price for a drug which is relied upon by many thousands of patients," Philip Marsden, chairman of the CMA's case decision group, said on Wednesday.
"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."
It planned to appeal all aspects of the CMA's verdict, Pfizer said in a statement.
The U.S. drugmaker said that it was forced to consider whether it could continue supplying the medicine since it had been loss-making for the company. Compared to the costs of an equivalent tablet form from another supplier, the price that was set by Flynn was actually 25 to 40 percent less, Pfizer added in the statement.
Plans to appeal against the verdict are also being made by Flynn. Punishing Flynn for selling phenytoin capsules for less than phenytoin tablets "beggars belief", said the Chief executive of the company, David Fakes.
(Source:www.reuters.com)
