Drug makers accused over agreements that kept prices high for NHS

(c) Sky News 2017: <a href="http://news.sky.com/story/drug-makers-accused-over-agreements-that-kept-prices-high-for-nhs-10788624">Drug makers accused over agreements that kept prices high for NHS</a>

Two drugs firms have been accused by the competition watchdog of signing "illegal agreements" that resulted in the cost of life-saving hydrocortisone tablets sold to the NHS remaining high.

Actavis UK is alleged to have entered into an arrangement with Concordia that "incentivised" it not to enter the market with its own competing version of the drugs.

The Competition and Markets Authority (CMA) provisionally found that both companies broke competition law, and also that Actavis abused its dominant position "by inducing Concordia to delay its independent entry into the market".

It is the latest case in which the CMA has accused drugs firms of overcharging.

In December, it separately alleged that Actavis UK overcharged the NHS by hiking the price of hydrocortisone tablets by more than 12,000%.

In the latest claim, the company is alleged to have supplied Concordia with a fixed supply of its own 10mg tablets "for a very low price" for Concordia to resell to customers in the UK.

The CMA said Actavis remained the sole supplier of the tablets in the UK during this period from January 2013 to June 2016, as the cost of the drug rose from £49 to £88 per pack.

Hydrocortisone tablets are used to treat people who suffer from conditions where their adrenal glands do not produce enough natural steroid hormones, such as Addison's disease - which is a life-threatening condition.

Andrew Groves, from the CMA, said: "Anti-competitive agreements can cost the NHS, and ultimately the taxpayer, by stopping competition bringing down the cost of lifesaving drugs like hydrocortisone tablets.

"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."

The CMA made clear that the findings were provisional and no conclusion should be drawn at this stage about whether there had been any breach of competition law.

Concordia said in a statement that it believed a supply arrangement between the two companies did not infringe competition law, and that it was cooperating fully with the CMA.

Teva, the Israeli-based company that holds the licence for the Actavis trade mark, confirmed that it was the subject of allegations by the CMA and said it would be making no further comment on the ongoing investigation.

Last year, drugs giant GlaxoSmithKline (Other OTC: GLAXF - news) was among firms hit with a £45m penalty after a "pay-to-delay" scandal surrounding blockbuster anti-depressant drug Seroxat.