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Anti-competitive behaviour - UK drug companies fined £260m for inflating prices for NHS

Graham Watson

15th July 2021

The Competition and Markets Authority (CMA) has fined a UK drug company £260m for inflating the price of hydrocortisone tablets for a decade.

Accord-UK, which was made up of Auden Mckenzie and Actavis UK, were able to increase the price of a 10mg packet of tablets from 70p in April 2008 to £88 by March 2016 using a variety of tactics, not least paying potential rivals not to enter the market.

As a result, the NHS was forced to pay higher prices for the drug.

The head of the CMA is quoted as saying:

“These are without doubt among the most serious breaches we have uncovered in recent years. Our fine serves as a warning to any other drug firm planning to exploit the NHS.”

I pose a simple question: why isn't this a criminal case?

Hasn't the company defrauded the taxpayer of millions of pounds? And haven't the executives of the company been well-rewarded for doing so? It seems that fines are just another cost of doing business as directors seek higher profits, remuneration and dividends

Horizontal and Vertical Collusion Explained I A Level and IB Economics

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