Drugs giant Pfizer has been fined a record £84.2 million by the competition watchdog for its role in over-charging the NHS after the price of an epilepsy drug was hiked by up to 2,600% overnight.
The Competition and Markets Authority (CMA) also fined distributor Flynn Pharma £5.2m after it accused the pair of “excessive and unfair” pricing for a vital medicine used by around 48,000 patients in the UK.
In handing out its biggest ever fine, the watchdog said the “extraordinary” price hikes cost the NHS and taxpayer tens of millions of pounds.
It comes 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% and 2,600% 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.
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.
The hikes meant the cost to the NHS rocketed from around £2m a year in 2012 to about £50m in 2013.