Two pharmaceutical firms have been accused of signing an illegal deal with each other, driving up prices of a life-saving drug.
The UK’s Competition and Markets Authority (CMA) alleges that Concordia and Actavis UK entered into agreements under which the latter incentivised the former not to enter the market with its own competing version of hydrocortisone tablets.
Hydrocortisone tablets are used by people with adrenal insufficiency, a life-threatening condition where their adrenal glands do not produce enough natural steroid hormones. Around 943,000 packets of the tablets were distributed over the last year, according to the CMA.
The CMA on Friday said that both companies broke competition law by reaching these anti-competitive agreements and that “Actavis UK abused its dominant position by inducing Concordia to delay its independent entry into the market.”
Under the deal, Actavis UK supplied Concordia with a fixed supply of its own 10mg tablets for a very low price for Concordia to resell to UK customers.
The cost of the NHS drug rose from £49 to £88 per pack between January 2013 and June 2016 when the agreements between the companies were in place, according to the CMA.
"We allege these agreements were intended to keep Actavis UK as the sole supplier of a drug relied on by thousands of patients - and in a position which could allow it to dictate and prolong high prices,” Andrew Groves, senior responsible officer at the CMA said.
Mr Grove added that for now the findings were “only provisional” and that “no conclusion should be drawn at this stage”.
“We will carefully consider any representations of the companies under investigation before determining whether the law has been infringed,” he said.
The findings come as after a separate investigation by the CMA investigation in December accused Actavis UK of charging excessive prices to the NHS for the tablets following a 12,000 per cent price rise over the course of several years.
Pharmaceutical firm Teva confirmed Actavis UK was the subject of "allegations of anti-competitive conduct" from the CMA.
Concordia was not immediately available for comment.
