Roundup: U.S. pharma giant Pfizer given record fine over price-hike medicine

A record fine of 106.4 million U.S.dollars has been imposed on New York-headquartered pharmaceutical giant Pfizer, Britain's Competition and Markets Authority(CMA) announced Wednesday.

A lesser fine of almost 6.6 million U.S.dollars was imposed on Flynn Pharma who distributed the drug.

In a statement, the CMA described the penalty on Pfizer as the authority's record fine.

The CMA said it had found that both Pfizer and Flynn Pharma broke competition law by charging excessive and unfair prices in Britain for phenytoin sodium capsules, an anti-epilepsy drug.

The CMA has also ordered the companies to reduce their prices. The drug is taken by about 48,000 people in Britain.

"The fines follow prices increasing by up to 2,600 percent overnight after the drug was deliberately de-branded in September 2012," said the CMA.

It said the amount the National Health Service (NHS) was charged for 100 mg packs of the drug rocketed from 2.83 pounds (3.58 U.S.dollars) to 67.50 pounds (83.50 U.S.dollars) , before reducing to 54 pounds (68 U.S.dollars) from May 2014.

"As a result of the price increases, NHS expenditure on phenytoin sodium capsules increased from about 2 million pounds (2.53 million U.S.dollars) a year in 2012 to about 50 million pounds in 2013. The prices of the drug in the UK have also been many times higher than Pfizer's prices for the same drug in any other European country," said the CMA.

The CMA said Pfizer has continued to manufacture phenytoin sodium capsules and supplied them to Flynn Pharma at prices significantly higher than those at which it previously sold in Britain under its previous brand name.

The increased prices ranged between 780 percent and 1,600 percent.

Flynn Pharma then sold on the products to British wholesalers and pharmacies charging them prices which have been between 2,300 percent and 2,600 percent higher than those they had previously paid for the drug.

CMA investigator Philip Marsden said: "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. These extraordinary price rises have cost the NHS and the taxpayer tens of millions of pounds."

"This is the highest fine the CMA has imposed and it sends out a clear message to the sector that we are determined to crack down on such behaviour and to protect customers, including the NHS, and taxpayers from being exploited."

The CMA has given Pfizer and Flynn between 30 working days and four months to reduce their respective prices. Endit