The CMA has imposed over £100 million (US$118.8 million) in fines after Advanz inflated the price of thyroid tablets, causing the National Health Service (NHS) and patients to lose out.
Following an investigation, the Competition and Markets Authority (CMA) found that from 2009 until 2017, the pharmaceutical company Advanz charged excessive and unfair prices for supplying liothyronine tablets which are used to treat thyroid hormone deficiency.
They achieved this because liothyronine tablets were among a number of drugs that, although genericised, faced limited or no competition and therefore could sustain repeated price increases. This strategy, which began in 2007, involved an overall price increase for liothyronine tablets of more than 6,000%.
The CMA has fined the firms involved a total of over £100 million for the relevant periods in which they broke the law: Advanz (£40.9 million), together with HgCapital (£8.6 million) and Cinven (£51.9 million) – two private equity firms which were previously owners of the businesses now forming part of Advanz.
The price increases were not driven by any meaningful innovation or investment, volumes remained broadly stable, and the cost of producing the tablets did not increase significantly. The NHS spending on the tablets in 2006, the year before the implementation of the strategy, was £600,000 (US$712,890), but by 2009 had increased to more than £2.3 million (US$2.7 million) and jumped to more than £30 million (US$35.6 million) by 2016.
Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.