Pfizer and Flynn Pharma accused over epilepsy drug pricing
Two drugs companies have been accused of charging "excessive and unfair prices" for epilepsy medication.
The Competition and Markets Authority (CMA) said it is investigating whether Pfizer and Flynn Pharma abused their dominant position over the pricing of phenytoin sodium capsules, in breach of UK and EU competition law.
CMA senior director of antitrust enforcement Ann Pope said: "While businesses are generally free to set prices as they see fit, those that hold a dominant position have a special responsibility to ensure that their conduct does not impair genuine competition and that their prices are not excessive and unfair.
"The prices that the CMA is concerned about in this case are very high compared to those prices previously charged and have led to a big increase in the total NHS drug bill for what is a very important drug for tens of thousands of patients."
The CMA said that while the NHS spent around £2.3 million a year on phenytoin sodium capsules before September 2012, this rose to more than £50 million in 2013 and over £40 million last year.
Phenytoin sodium capsules are used to prevent and control seizures and are used by more than 50,000 patients in the UK.
Pfizer manufactures phenytoin sodium capsules and supplies them to Flynn Pharma, which distributes them to UK wholesalers and pharmacies.
The CMA has issued a statement of objections, which concerns the prices Pfizer has charged to Flynn Pharma and the prices Flynn Pharma has charged to its customers, since September 2012.
Before September 2012, Pfizer manufactured and sold phenytoin sodium capsules to UK wholesalers and pharmacies under the brand name Epanutin. Pfizer sold the UK distribution rights for Epanutin to Flynn Pharma, which genericised the drug and started selling its version in September 2012.
The CMA said Pfizer continued to manufacture the drug, which it sold to Flynn at prices that were significantly higher than those at which it had previously sold Epanutin in the UK - between eight and 17 times Pfizer's historic prices. Flynn then sold the drug to customers at prices which were between 25 and 27 times higher than those historically charged by Pfizer.
Ms Pope said: "The CMA's findings on dominance and abuse are provisional and no conclusion can be drawn at this stage that there has, in fact, been any breach of competition law.
"We will carefully consider any representations from Pfizer and Flynn Pharma before deciding whether the law has been infringed."
A spokeswoman for Pfizer said: "Ensuring a sustainable supply of our products to UK patients is of paramount importance to Pfizer and was at the heart of our decision to divest the product. Pfizer is co-operating fully with the CMA's ongoing investigation.
"The Statement of Objections is the CMA's provisional findings only and all parties will now have the opportunity to respond to the statement before the CMA decides if there has been any infringement."
A Flynn Pharma spokesman said: "We've been cooperating with the CMA and will continue to do so."