The Competition and Markets Authority has imposed fines of over £100 million on Advanz Pharma and two associated companies after they were found to have inflated the price of liothyronine tablets.
The CMA found that from 2009 until 2017 Advanz charged excessive and unfair prices for supplying liothyronine tablets, used to treat thyroid hormone deficiency. The strategy, which began in 2007, saw the overall price for liothyronine tablets increase by more than 6,000 per cent.
Liothyronine was one of a number of off-patent generic drugs that faced limited or no competition and so could sustain repeated price increases. Eventually the drug was placed on the NHS ‘drop list’ in July 2015. This led to patients being faced with the prospect of having their current treatment stopped or having to purchase liothyronine tablets at their own expense.
That was particularly concerning, given that many patients do not respond adequately to the main treatment for hypothyroidism, levothyroxine tablets – and instead rely on liothyronine tablets, said the CMA.
“Advanz’s decision to rachet up the price of liothyronine tablets came at a huge cost to the NHS, and ultimately to UK taxpayers," said Andrea Coscelli, CMA chief executive.
"But that wasn’t all – it also meant that people dealing with depression and extreme fatigue as a result of their thyroid conditions were told they could not continue to receive the most effective treatment for them due its increased price.”
The CMA has fined the firms involved a total of over £100m for the relevant periods in which they broke the law. Advanz Pharma Corp and three of its subsidiarieshave been fined £40.9m.
Two private equity firms – HgCapital and Cinven, which were previously owners of the businesses now forming part of Advanz – have been fined £8.6m and £51.9m respectively.
The price increases were not driven by any meaningful innovation or investment, said the CMA. Volumes remained broadly stable, and the cost of producing the tablets did not increase significantly. NHS spending on the tablets in 2006, the year before the implementation of the strategy, was £600,000, but by 2009 had increased to more than £2.3m and jumped to more than £30m by 2016.
This is the latest of a number of cases where the CMA has imposed heavy fines on pharmaceutical companies for price manipulation. Recent action includes: