The Competition Regulator’s Attempts To Disqualify Pharmaceutical Company Directors Is Considered By Nicola Sharp, Of Financial Crime And Regulatory Specialists Rahman Ravelli – White Collar Crime, Anti-Corruption & Fraud

The Competition and Markets Authority (CMA) is seeking to
disqualify seven directors of four companies for collusion after
certain prescription drug prices rose by 700%.

Alliance Pharma PLC, Advanz Pharma Corp, Lexon (UK) Ltd and
Medreich PLC were fined a combined total of £35 million by
the CMA earlier this year. The regulator found that the companies
conspired in the supply of anti-nausea drugs and increased the
prices from £6.49 per package to £51.68 between 2013
and 2017.

The CMA is now going to the High Court to implement competition
disqualification orders against seven directors, after concluding
that they were personally involved in the collusion. According to
the competition watchdog, the directors were involved in a
conspiracy to reduce competition in the supply of dissolvable
prochlorperazine in the UK and then increase its price. The drug is
used to treat nausea, dizziness and migraines.

In this case, it was found that the NHS spent around £7.5
million on prochlorperazine packages in May 2019, an increase from
£2.7 million. Yet fewer medication packages were
distributed.

Over recent years, the NHS has experienced stresses and strains
as a result of the pandemic, funding and staff shortages. The CMA
is now taking action against those who have contributed to this
strain within the pharmaceutical sector, which is a positive
step.

Having achieved the issuing of severe fines to these companies,
it will be interesting to see whether the applications to the High
Court for disqualification of the directors will be just as
successful.

For information relating to enforcement, cartels, competition
and the CMA, you can read the guide: Cartels And Competition:
Cartels And Competition: The Law, Its Enforcement And The Need For
Advice.

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