Pfizer fined for epilepsy drug price increase by UK antitrust regulator

Pfizer has been fined for unfairly increasing the price of epilepsy drug Epanutin (phenytoin sodium) by the UK Competition and Markets Authority (CMA).

The pharma giant sold the rights to Epanutin in the UK to Flynn Pharma in 2012. The CMA, however, found that that Pfizer increased the price it sold the drug to Flynn at between 8 and 17 times Pfizer’s historic prices of the drug. Flynn were then said to have sold the drug at prices which were between 25 and 27 times higher than those historically charged by Pfizer.

The fine imposed by the CMA was £10,000, a drop in the ocean to a company like Pfizer for sure, but the authority was acting within its own limitations where the maximum fine that could be imposed was £30,000.

In their report on the issue, the CMA rebuked the actions of Pfizer throughout the investigation quite strongly, indicating that the company’s “failure to comply [on certain aspects] was intentional”.

Prior to September 2012, the NHS spent approximately £2.3 million per year on phenytoin sodium capsules. At the time that the CMA expressed concerns over the conduct of Pfizer and Flynn in this regard, with senior director of antitrust enforcement, Ann Pope, commenting: “While businesses are generally free to set prices as they see fit, those that hold a dominant position have a special responsibility to ensure that their conduct does not impair genuine competition and that their prices are not excessive and unfair. The prices that the CMA is concerned about in this case are very high compared to those prices previously charged and have led to a big increase in the total NHS drug bill for what is a very important drugs for tens of thousands of patients.”

In the report compiled by Philip Marsden, case decision group chairman, it closes with a very pointed comment on the level of fine. It reads: “For the purposes of assessing whether a penalty of £10,000 is appropriate and proportionate, the CMA has also had regard to certain key indicators relating to the financial resources available to Pfizer: (a) profit after tax - £40,071,000; (b) net assets with dividends added - £409,694,000; and (c) turnover - £1,256,543,000. These indicators show that Pfizer… will not be materially affected by a penalty of £10,000 in a disproportionate manner.”

Sean Murray