A Canadian pharmaceutical company has been accused of deliberately overcharging the NHS more than £100 million over the past 10 years.
Concordia Healthcare, which was founded in 2012 and owns numerous pharmaceutical brands, allegedly hiked the price of liothyronine, a medicine used to treat thyroid disorders, by more than 6,000% over the past decade.
Although the company was founded just five years ago, Concordia has pursued a “growth via acquisition” strategy and operates a number of pharmaceutical brands. The company allegedly began its overpricing strategy in 2007.
According to the Competition and Markets Authority, Concordia began increasing the price of its thyroid medication in 2007. Over the last decade, the cost of a single packet of liothyronine paid by the NHS has increased from £4.46 to a staggering £258.19.
This price increase occurred despite the manufacturing costs of liothyronine remaining stable, according to a statement from the CMA.
Liothyronine is an essential medicine for treating a variety of thyroid conditions. People with an underactive thyroid — medically referred to as hypothyroidism — often use liothyronine to treat a deficiency of natural thyroid hormone production.
Hypothyroidism affects an estimated two people in every 100 and results in a variety of major symptoms, ranging from fatigue and lethargy to weight gain. Liothyronine is considered one of the only treatments for hypothyroidism for patients that fail to respond to levothyroxine.
According to the CMA, Concordia Healthcare could be fined as much as 10% of its worldwide annual revenue in response to the overpricing scandal.
In a statement, CMA chief executive Andrea Coscelli stated that drug companies that “abuse their position and overcharge for drugs” force UK taxpayers to overpay for medical treatments and care.
Coscelli also stated that the CMA’s findings are “provisional” and that the company hasn’t yet been found to have violated competition law.
Concordia is not the only pharmaceutical company to face public and regulatory scrutiny for its pricing strategy. American drug giant Pfizer was recently forced to pay a record £84.2 million in fines after it was found to have overcharged the NHS for a vital anti-epilepsy medication.
The medication in question, which contains phenytoin sodium, is used by approximately 48,000 people in the UK to treat epileptic seizures. Pfizer reportedly increased the price of the drug by 2,600% overnight, resulting in significant unexpected costs for UK taxpayers.
According to the CMA, Pfizer’s decision took advantage of a practice by the NHS that prevents patients from being switched to alternative medication brands. As a result of the price increase, the NHS spent more than £50 million on the drug in 2013, compared to £2 million in 2012.
Pfizer was also found to have overcharged UK health services specifically, offering an identical drug for a significantly lower price to healthcare providers in other European countries.
The decision to find Pfizer is currently under appeal. Currently, the CMA has publicly stated that it will consider representatives from Concordia before moving forward with a legal decision over the company’s pricing tactics.