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Record fines for drug companies who overcharged NHS for anti-epilepsy drug

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Nicola Swanborough

Record fines for drug companies who overcharged NHS for anti-epilepsy drug

Pfizer was fined a record £84.2m by the Competition and Markets Authority (CMA) for increasing the price of its phenytoin sodium capsules by between 2,300-2,600 per cent over night in 2012. The CMA also fined distributor Flynn Pharma £5.2 million after it accused the pair of "excessive and unfair" pricing for the vital medicine used by around 48,000 patients in the UK.

Epilepsy Society's Chief Executive Clare Pelham said: "The Competition and Markets Authority is a serious and thoughtful body and when they describe pricing as 'excessive and unfair' then I think drug manufacturers should pause and take a moment to reflect. The Prime Minister has spoken recently about responsible capitalism. It doesn't feel as if price increases of up to 2,600% quite pass that blush test".

8th August 2018 - tribunal overrules findings in case involving epilepsy drug

5th July 2018 - Epilepsy Society's CEO writes to Flynn Pharma and Pfizer On NHS's 70th Birthday

9th December 2016 - Epilepsy Society's CEO Clare Pelham tackles Pfizer in the Times

9th December 2016 - Flynn Pharma Responds To Clare Pelham's Letter In The Times

7th December 2016 - Drug firms should blush at up to 2,600 per cent price rise to NHS

Tribunal overrules findings in case involving epilepsy drug

A decision by the Competition and Markets Authority to fine Pfizer and Flynn Pharma a total of £90m for overcharging for an epilepsy drug, has been remitted back to the CMA after a tribunal ruled against the government watchdog's decision.

In December 2016 the CMA decided that the two pharmaceutical companies had breached competition law by charging unfairly high prices for phenytoin sodium.

The two companies appealed against the decision.

Although the Competition Appeal Tribunal agreed with much of the CMA's findings, it ruled against its findings that the companies had abused a dominant position.

The CMA is now considering whether to appeal against its findings.

Competition Appeal Tribunal judgement

CMA considers appeal

Epilepsy Society's CEO writes to Flynn Pharma and Pfizer on NHS's 70th Birthday

With the NHS's 70th birthday celebration on 5 July 2018, Epilepsy Society's CEO, Clare Pelham, wrote to the pharmaceutical companies Flynn Pharma and Pfizer to ask them to give a birthday present to the National Health Service.

In June 2018, the two companies avoided a £90 million fine from the Competitions and Markets Authority (CMA). The fine was brought against them for the companies' 2,500% price hike of the epilepsy drug phenytoin sodium - the CMA ruled that this price increase was excessive and unfair.

In a letter to each company, Clare has asked that the two companies show they "have a heart as well as a balance sheet" by gifting a percentage of the dodged fine to the NHS. This gift could be given as a gesture to offset the bill sent to taxpayers to cover the "extraordinary price increase" of the anti-epileptic drug.

Around 48,000 people with epilepsy in the UK depend on the drugs supplied by Flynn Pharma and Pfizer to gain seizure control, and a gift from the companies could make a real difference to the quality of the epilepsy services delivered on the NHS. Clare writes in her letter "surely the NHS's 70th anniversary is the time to deliver a birthday present that could make a real difference in helping the NHS to support people with epilepsy."

Clare continued in her letter - "Even if you only gave 10% of the fine - £9 million - that could be life-changing for some patients.  And the full £90 million would show that you really do care."

The case against Flynn Pharma and Pfizer has been remitted back to the CMA by the Competition Appeal Tribunal (CAT) and is awaiting a final decision on whether or not the fines are reinstated. We hope that they consider Clare's plea to show their care for epilepsy patients and make a financial contribution to the NHS on its 70th birthday.

Epilepsy Society's CEO Clare Pelham tackles Pfizer in the Times

A letter in The Times from Epilepsy Society's chief executive Clare Pelham calls on drug company Pfizer to give people with epilepsy a hard and fast guarantee that it will continue to manufacture phenytoin sodium capsules.

Clare Pelham letter in the Times

In the letter Clare Pelham says:

"Sir, When Theresa May launched her successful bid for No 10 she did so with a call for "responsible capitalism". The Competition and Markets Authority has just handed a record fine of £84.2 million to Pfizer, and another to Flynn Pharma (Dec 8), for what can only be described as irresponsible capitalism, or more accurately corporate greed.

Of course drug manufacturers must make a reasonable profit to fund their research. Pfizer says on its website that one of its four strategic priorities is 'earning greater respect from society'. Quite right. But that is hard to reconcile with a price increase of up to 2,600 per cent for a single vital drug for 48,000 people with epilepsy in Britain.

If Pfizer really means what it says, it should immediately reassure these 48,000 people, who will otherwise have an anxious Christmas, that the company will continue to manufacture its vital phenytoin sodium capsules come what may."

Clare has also spoken on Sky News and Radio 5 Live, criticising Pfizer and Flynn Pharma's decision to increase the price of the epilepsy drug to an excessive rate.

Clare at the BBC

Clare said: ''Over one per cent of the population - or 600,000 people - have epilepsy, It is vital that they can have confidence in the supply of their current medication, and confidence that research is underway to develop new and better drugs for the future.

"Every day members of the public support medical research by Epilepsy Society, with our partners, to improve the lives of those affected by epilepsy. It seems entirely wrong that as tax payers they should be asked to support price increases by up to 2,600 per cent to the NHS."

Flynn Pharma responds to Clare Pelham's letter In The Times

The UK-based pharmaceutical company Flynn Pharma Ltd has written to Epilepsy Society's Chief Executive Clare Pelham to reassure her that they do not foresee any disruption to supply or availability of the epilepsy drug phenytoin sodium.

The UK-based pharmaceutical company Flynn Pharma Ltd has written to Epilepsy Society's chief executive Clare Pelham to reassure her that they do not foresee any disruption to supply or availability of the epilepsy drug phenytoin sodium.

The response follows Clare Pelham's letter in today's Times, asking manufacturers of the drug, Pfizer, to confirm that it will continue to produce the drug in spite of being fined a record £84.2 million by the Competition and Markets Authority. Flynn Pharma, which distributes the drug, was fined £5.2 million.

Dr David Fakes, chief executive officer of Flynn Pharma, said that as marketing authorisation holder they have full legal responsibility for the supply and monitoring of the drug. He said Pfizer manufactured phenytoin sodium to their orders and specification.

In response to Epilepsy Society's concerns that supply of the drug could be at risk, Dr Fakes told Clare Pelham: "Flynn Pharma entirely understands and shares that concern. A robust and continuous supply chain has always been our intention.

"I do, however, on behalf of Flynn, want to reassure you that the patient remains a central focus of our concern. We will fully honour and respect that commitment. Whilst no manufacturer may offer cast iron guarantees, Flynn's record of continuous supply of these products and indeed many others, is indeed exemplary and a matter in which we take pride. We do not anticipate any disruptions to supply or availability whilst we separately address the findings of the CMA."

Clare Pelham said she was encouraged by Flynn Pharma's response but would be seeking further clarity over points raised in the letter.

You can read the full content of the letter below.

Flynn Pharma's letter for Clare Pelham

Flynn Pharma's letter for Clare Pelham

Drug firms should blush at up to 2,600 per cent price rise to NHS

Epilepsy Society's new Chief Executive Clare Pelham has stressed the need for a balance in the price the NHS is charged for drugs. The call follows news that Pfizer has been fined a record £84.2 million for its role in over-charging for an epilepsy drug.

The pharma company was fined by the competition watchdog, the Competition and Markets Authority (CMA) for increasing the price of its phenytoin sodium capsules by between 2,300-2,600 per cent over night in 2012.

The Competition and Markets Authority (CMA) also fined distributor Flynn Pharma £5.2 million after it accused the pair of "excessive and unfair" pricing for the vital medicine used by around 48,000 patients in the UK.

Reasonable profit

Clare Pelham said: 'There must be a balance on the price the NHS is charged for drugs. Manufacturers must make a reasonable profit to fund their important research and ensure patients continue to receive important drugs.

'Over one per cent of the population - or 600,000 people - have epilepsy, It is vital that they can have confidence in the supply of their current medication, and confidence that research is underway to develop new and better drugs for the future. Every day members of the public support medical research by Epilepsy Society, with our partners, to improve the lives of those affected by epilepsy. It seems entirely wrong that as tax payers they should be asked to support price increases by up to 2,600 per cent to the NHS.

'The CMA is a serious and thoughtful body and when they describe pricing as "excessive and unfair" then I think drug manufacturers should pause and take a moment to reflect. The prime minister has spoken about responsible capitalism. It doesn't feel as if price increases of up to 2,600 per cent quite pass that blush test.'

Government crackdown

The fines come amid a government crackdown on drug pricing abuse over fears firms are using generic versions of medicines to exploit an NHS loophole.

The CMA said the NHS saw the cost of phenytoin sodium capsules, which are used to prevent and control seizures, rocket by between 2,300 per cent and 2,600per cent overnight in September 2012 after it was deliberately debranded.

US-based Pfizer has rejected the findings and plans to appeal against the decision.

Pfizer makes the drug and sells it to Flynn, which in turn sells it to the NHS.

Epanutin

Pfizer used to make and sell the drug under the brand name Epanutin, but sold the UK distribution rights to Flynn in September 2012.

It was then debranded, meaning that it was no longer subject to price regulation and both firms were free to ramp up the price.

The CMA said the NHS at one stage saw the price of 100mg packs of the drug jump from £2.83 to £67.50.

Price hike

The hikes meant the cost to the NHS rocketed from around £2 million a year in 2012 to about £50 million in 2013.

The CMA said UK prices were many times higher than elsewhere in Europe.

But the NHS had no alternative but to pay, as epilepsy patients who are already taking the drug should not usually be switched to other products due to the risk of loss of seizure control.

Vital drug

Philip Marsden, chairman of the case decision group for the CMA's investigation, 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.'

Pfizer claimed the anti-epilepsy drug was loss-making before it was de-branded, but the CMA found any losses would have been recouped within two months of the price rises.

Both firms have now been given up to four months to reduce their prices.

Pfizer responds

Pfizer said its distribution rights deal with Flynn 'represented an opportunity to secure ongoing supply of an important medicine for patients with epilepsy'.

It added the increased price of the drug was still 25 per cent to 40 per cent lower than the cost of an equivalent medicine by another supplier to the NHS.

Flynn Pharma said it will also appeal against the decision.