Pfizer and Flynn Pharma are under the scrutiny of British watchdogs once again, after officials said the companies have been overcharging for an anti-epilepsy medication in the U.K. for over four years.
Pfizer and Flynn Pharma are under the scrutiny of British watchdogs once again, after officials said the companies have been overcharging for an anti-epilepsy medication for over four years. A fine totaling $84 million, or 70 million pounds, has been issued to the two companies.
This marks the second time that the Competition and Markets Authority (CMA) has issued a negative finding, coupled with a fine, to Pfizer and Flynn for the alleged infraction. The CMA serves as a U.K. regulatory body tasked with regulating the consumer market to ensure fair treatment of consumers. In that role, the regulator protects the National Health Services (NHS), the country’s public health system.
According to a 2021 statement by CMA officials regarding suspicions of overcharging, the country was left with little option but to pay the high price.
“As Pfizer and Flynn were the dominant suppliers of the drug in the U.K., the NHS had no choice but to pay unfairly high prices for this vital medicine,” the agency said.
The CMA’s decision this week has a roller coaster of a background. The drug was sold under the brand name Epanutin by Pfizer without reports of price gouging. In 2012, the anti-epilepsy drug was de-branded. Without a brand name, the drug evaded strict regulatory rules that accompany branding, the regulator said. Pfizer then allegedly began distribution through Flynn at a price exceeding 2,000% of the brand-name cost.
The CMA fired back and accused Pfizer of taking advantage of the loophole to be able to manipulate pricing without regulation. A report issued by the CMA noted that the NHS spent roughly 25 times more in 2013 than it had in 2012 to ensure that U.K. patients were able to receive the life-saving drug.
In 2016, the CMA issued a fine of roughly $107 million, or 90 million pounds, accusing the companies of inflating the price of the drug by approximately 2,600% to 67.50 pounds for a 100mg pack. In 2018, Pfizer and Flynn appealed the decision, with success. The pair is expected to attempt an appeal this time around as well, telling Reuters they are “Surprised and disappointed at the Competition and Markets Authority (CMA) issuance of a further (second) Decision finding an abuse of competition law on the part of Flynn.”
A similar issue made U.S. headlines right around the same time as the CMA’s 2016 decision. Pfizer’s Meridian Medical, subcontracted by Mylan, was producing EpiPens when the pair were accused of overcharging for the life-saving epinephrine injector. Early into its lifespan, the EpiPens cost was about $57 each. In 2016, two pens could be purchased at an increased price of $600.
Following an accusation by the U.S. Justice Department that the EpiPen was misclassified as a generic product, thereby skirting regulations, Mylan paid a $465 million settlement.
