Pfizer wins appeal against fine for Epanutin price increase

In 2013, the Competition and Markets Authority commenced investigations into Pfizer and its distributor Flynn Pharma for increasing the price of its epilepsy drug Epanutin by 2,000% from £2.83 per pack of capsules to £67.50. In 2016 Pfizer was fined £84.2m and Flynn was fined £5.2m and they were both told to decrease the price of the drug within 30 days and four months respectively. Both companies appealed the decision to the UK’s Competition Appeals Tribunal (CAT).
Although the annual cost to the NHS had increased from £2m in 2012 to £50m in 2013, CAT concluded the CMA had not applied the correct legal tests to ascertain whether the price increase was too high and had not considered the correct price for the product or taken into account other comparable products. It recommended that the CMA reconsider its case once it had corrected its errors.
Philip Marsden, the CMA’s chairman of the case decision group for the investigation said: “Businesses are generally free to set prices as they see fit but those holding a dominant position should not abuse this situation and set prices that are excessive and unfair. There is no justification for such rises when phenytoin sodium capsules are a very old drug for which there has been no recent innovation or significant investment.” He believes Pfizer and Flynn Pharma have “deliberately exploited” the fact that generic drugs in the UK are not subject to price controls, and Epanutin came off patent in 2012.
Pfizer said: “Our priority has always been to ensure a sustainable supply of our medicines to UK patients and this was at the heart of our decision to divest this medicine.”