3 Min Read
(Reuters) - Drug maker Actavis UK broke competition law by raising prices of hydrocortisone tablets by more than 12,000 percent, Britain's competition watchdog said in a provisional ruling on Friday.
Higher prices meant the tablets cost Britain's National Health Service (NHS) about 70 million pounds ($87 million) last year, up from about 522,000 pounds previously, the CMA said.
The company raised prices of 10 mg hydrocortisone tablets by more than 12,000 percent compared to the price they were sold at by another company before April 2008, the Competition and Markets Authority (CMA) said.
It raised the price of 20 mg hydrocortisone tablets by nearly 9,500 percent, the CMA said.
The 10 mg tablets which cost the NHS 70p each in April 2008 cost 88 pounds by March 2016, it found.
The tablets are used for hormone replacement therapies in people whose adrenal glands do not produce sufficient amounts of natural steroid hormones.
Pharmaceutical companies have faced regulatory scrutiny recently for buying smaller companies and then raising their prices many fold.
The CMA fined Pfizer Inc 84.2 million pounds for ramping up the cost of an epilepsy drug by as much as 2,600 percent.
Actavis UK's former parent Allergan Plc was created by a $66 billion merger that saw Dublin-based Actavis acquire Botox maker Allergan Inc in November 2014 and change its name to the latter. (reut.rs/2hqLmCj)
Israel's Teva Pharmaceutical Industries bought the company in a $40.5 billion deal that closed in August.
Teva confirmed that Actavis UK had received a statement of objection from the CMA and that it would defend itself against the allegations.
"Although the pricing of the acquired Actavis product, Hydrocortisone, under investigation was never under Teva's effective control, Teva believes that intervention by the CMA in prices for generic medicines raises serious policy concerns regarding the roles of both the CMA and the Department of Health," the company said in an emailed statement.
Teva is in the process of selling Actavis UK and Actavis Ireland to India's Intas Pharmaceuticals Ltd.
The CMA said its findings were provisional and it would consider representations of the parties under investigation before determining whether the law had been infringed.
Reporting by Vidya L Nathan and Rahul B in Bengaluru; editing by Jason Neely