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In the News

Pfizer and Flynn fined £70m for price fixing a life-saving epilepsy drug

Geoff Riley

21st July 2022

In an egregious example of price fixing, Pfizer and Flynn have been fined £70 million for abusing their dominant positions to overcharge the NHS for a life-saving epilepsy drug.

This is a really good example of anti-competitive behaviour being investigated by the UK’s main competition watchdog.

The CMA report will make many people very angry indeed.

Having rebranded their drug Phenytoin to take it out of the realms of price regulation, Pfizer and Flynn charged unfairly high prices for phenytoin sodium capsules for over 4 years, ultimately paid for by the NHS. Pfizer charged prices between 780% and 1,600% higher than previously.

The company supplied the drug to Flynn, which then sold the capsules on to wholesalers and pharmacies at a price between 2,300% and 2,600% higher than the prices previously charged by Pfizer.

Price fixing in this manner is clearly illegal as the final legal judgements have made clear. The final fines are: £63,300,000 (Pfizer) and £6,704,422 (Flynn).

But what of any judicial action against senior executives? Even fines in the tens of millions of pounds are small relative to their annual revenues and profits.

Geoff Riley

Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.

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