Two drugs firms have been accused by the UK’s competition watchdog of illegal pricing and abusing their dominant position to overcharge the NHS for vital anti-epilepsy tablets.
The Competition and Markets Authority (CMA) said it had provisionally found that coronavirus vaccine-maker Pfizer and Flynn broke competition law by charging unfairly high prices for phenytoin sodium capsules – hiking the cost of the treatment by up to 2,600% “overnight”.
It saw NHS spending on the capsules rocket from around £2m a year in 2012 to about £50m in 2013, according to the regulator.
The latest finding comes after the CMA reinvestigated the case following appeals by the two firms over an earlier decision in December 2016, which saw them slapped with a record £90m fine.
In 2018, the Competition Appeals Tribunal (CAT) upheld much of the original findings, but referred the matter of unlawful abuse of dominance back to the CMA for further consideration.
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The CMA and Flynn then went to the Court of Appeal, which dismissed the pharmaceutical firm’s appeal but upheld aspects of the CMA’s case.
Following this, the watchdog decided to re-investigate, launching its current inquiry in June 2020.
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CMA chief executive Andrea Coscelli said: “Thousands of patients depend on this drug to prevent life-threatening seizures as a result of their epilepsy.
“As the CAT recognised, this is a matter that is important for government, for the public as patients and taxpayers, and for the pharmaceutical industry itself.
“Protecting these patients, the NHS and the taxpayers who fund it is our priority.”
In its provisional finding, the CMA claims the companies exploited a loophole by de-branding the drug – known as Epanutin prior to September 2012 – with the effect that the drug was not subject to price regulation in the way branded drugs are.
It said: “As Pfizer and Flynn were the dominant suppliers of the drug in the UK, the NHS had no choice but to pay unfairly high prices for the vital medicine.”
Over more than four years, Pfizer’s prices rocketed by between 780% and 1,600%.
Pfizer then supplied the drug to Flynn, which sold it to wholesalers and pharmacies at prices between 2,300% and 2,600% higher than those they had paid previously, according to the CMA.
The CMA said Pfizer and Flynn now had an opportunity to respond to its provisional findings before a final decision was made.
The regulator said it remained committed in its work “to tackle robustly any illegal behaviour by drug companies overcharging the NHS”, pointing out it recently fined firms a total of £360m for competition law breaches over the supply of medication.
In a statement, 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 in 2012.
“In 2020, the Court of Appeal upheld the Competition Appeal Tribunal’s finding in the company’s favour.
“Pfizer continues to co-operate fully with the CMA’s ongoing investigation.
“The statement of objections is the CMA’s provisional findings only and all parties will have the opportunity to respond to the statement before the CMA decides if there has been any infringement.”
People whose homes have been destroyed by the floods sweeping across parts of the UK over the past couple of days have been telling Sky News how they coped with the deluge.
In Lincolnshire, where a major incident has been declared, Terry, from Grantham, showed a Sky crew the aftermath of the deluge in his home, which was left under two feet of water.
“Everything’s gone,” he said, adding that he was “devastated”.
The first sign of trouble came at lunchtime on Monday, when his wife woke him and said there was water coming in [to the house], and “within a few minutes, the whole house was flooded”.
They rushed their belongings and pets upstairs, he said, as he revealed the damage to the flooded living room and kitchen, where the water mark was above a power socket.
Terry said the kitchen, where the floor was covered in sludge, smelled of mud and sewage, and their furniture and carpets were wrecked.
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They have no electricity and the food in the cupboards and freezer was “completely ruined”.
Graham Johnson, who lives in a boat with his wife and dog, in the village of Barrow upon Soar in Leicestershire, was in the pub on Monday night, before the water started to rise “rapidly”.
People living in a local caravan park were moved as a severe flood warning was issued.
Mr Johnson said he had gone out “for a couple of pints as usual and, the next thing we know, bingo”.
The couple feared their boat home was about to be swept towards the bridge.
“That’s our pride and joy, where we live, and we didn’t want to lose it,” he said, as he praised the “fantastic” emergency services, who rescued them and their dog after a nervy three-hour wait.
They were two of the 59 people rescued by firefighters in the county, where a major incident was declared and crews were called out to 160 flood-related incidents, the Fire Brigades Union (FBU) said.
Another Leicestershire resident whose home was inundated was Qasim Abdullah from Loughborough.
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Flooding across East Midlands
Pictures taken by the Associated Press show him walking through almost knee-deep water in his living room.
In nearby Quorn, businesses have shut as the main high street has flooded for the second time in as many years.
Two of the pubs in particular have been damaged.
Last year, residents had to launch a crowd fundraiser to help pay for the costs of renovation. Not to mention soaring insurance premiums.
Indy Burmi, who owns a hair salon and restaurant, hasn’t suffered flooding, but said he’s had to close up and cancel all Tuesday’s reservations, as his clients simply can’t get into the village.
And, with more rain forecast, conditions could get even worse in the short term, while residents worry that an annual battle with rising water is now the new normal.
Elsewhere in the UK, the next danger is from ice forming on untreated surfaces after rain on Tuesday evening, the Met Office has said, as it issued a new warning for northern England and Wales from 5pm until midday on Wednesday.
The Royal Liverpool University Hospital has declared a critical incident due to “exceptionally high” demand on A&E and patients being admitted to wards.
The hospital said there had been a spike in people with flu and respiratory illnesses going to emergency departments in recent weeks.
A spokesperson for the hospital said it had a “comprehensive plan in place” and was “taking all the necessary actions to manage the challenging circumstances”.
“We are working with partner organisations to ensure those that are medically fit can leave hospital safely and at the earliest opportunity,” they added.
The hospital warned some people would experience delays as it prioritises the sickest patients.
People whose case isn’t an emergency are being asked to see their GP, pharmacy or walk-in centre – or call the 111 service for advice.
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The Royal Liverpool University Hospital is in the city centre and is the biggest hospital in Merseyside and Cheshire.
Declaring a critical incident can happen when a hospital is experiencing exceptional demand, or sometimes if there is a serious problem with staffing levels.
It indicates it can’t function as normal and allows it to take extra measures to protect patients, such as prioritising the most unwell people and getting support from other agencies.
It could last hours, a few days, or weeks if necessary.
A critical incident was also declared on Friday by the NHS Cornwall and Isles of Scilly Integrated Care Board.
It said it had seen almost four times as many inpatients compared with last year and urged people with flu to avoid going to A&E.