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Pfizer vows to appeal record £84.2m fine for drug price hike

UK competition watchdog issues fine for 2,600% increase in cost of an epilepsy drug

Pfizer used to market the medicine itself, under the brand name Epanutin, but sold the rights to Flynn

Wed Dec 7 2016 - 12:56

Drug giant Pfizer has said it will appeal a record £84.2 million (€99 million) fine imposed by Britain's competition watchdog over its marketing of an epilepsy drug.

The Competition and Markets Authority (CMA) said the US pharma group had ramped up the cost of the drug, by as much as 2,600 per cent.

The regulator also fined Flynn Pharma £5.2 million for its role in hiking prices of phenytoin sodium capsules in 2012.

It accused the two companies of abusing their dominant position in the UK by charging unfair prices for unbranded versions of the Phenytoin anti-epilepsy drug.

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Pfizer used to market the medicine itself, under the brand name Epanutin, but sold the rights to Flynn in September 2012, after which the product was debranded and the price soared.

“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,” said Philip Marsden, chairman of the case decision group for the CMA’s investigation. “These extraordinary price rises have cost the NHS and the taxpayer tens of millions of pounds.’’

The NHS spent about £50 million on the anti-epilepsy capsules in 2013 and £40 million in 2014, the CMA said in its August 2015 complaint. The amount the NHS was charged for 100-milligram packs of the drug “rocketed” from £2.83 to £67.50, before dropping to £54 starting in May 2014, the CMA said Wednesday.

In a statement, Pfizer said it believes the CMA findings “are wrong in fact and law and will be appealing all aspects of the decision”.

Flynn has also said it will appeal the ruling.

Pfizer said it had approached the sale of the drug to Flynn with “integrity, and believe it fully complies with established competition law”.

It said the Phenytoin capsules were a loss making product for Pfizer and that the Flynn transaction represented an opportunity to secure ongoing supply of an important medicine for patients with epilepsy, while maintaining continuity of manufacture.

“When Flynn launched its product, the company set a price that was between 25 and 40 per cent less than the price of the equivalent medicine from another supplier to the NHS which had long been regulated, and appeared to be acceptable to, the Department of Health,” Pfizer said in its statement.

Reuters / Bloomberg

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