An investigation is underway into whether two 海角视频 drug companies worked together to “carve up” the market for one of their products.
The Competition and Markets Authority (CMA) is looking into whether Morningside Pharmaceuticals in Loughborough and AMCo (since 2015 part of Advanz Pharma) came to an agreement in the supply of an antibiotic called Nitrofurantoin.
The CMA is looking at whether the pair had a deal in place between 2014 and “at least” October 2017, to supply a company called Alliance Healthcare with equal volumes of the drug – in breach of competition law.
The allegations are made in what is called a “Statement of Objections”
The government body said it is also investigating whether in 2015 and 2016 the two suppliers agreed to sell the drug exclusively to Alliance Healthcare.
And it is investigating whether AMCo disclosed sensitive pricing information to Morningside in May 2014 with the aim of “reducing competition between them”.
The CMA said a provisional finding suggested they may have broken competition law by "arranging to carve up the market between them".
Morningside has refuted the suggestions, while Advanz Pharma said it took competition law “very seriously”.
Most Read
Alliance Healthcare said it did not believe competition law had been infringed.
Want more business news straight to your inbox?
BusinessLive is your home for business news from around the country - and you can stay in touch with all the latest news through our email alerts.
You can sign up to receive morning news bulletins from every region we cover and to weekly email bulletins covering key economic sectors from manufacturing to technology and enterprise. And we'll send out breaking news alerts for any stories we think you can't miss.
Visit our email preference centre to sign up to all the latest news from BusinessLive.
Nitrofurantoin is available in tablets and liquid form, and the investigation focuses on 50mg and 100mg prescription-only capsules.
It is used for bladder infections such as cystitis.
The CMA said AMCo was the sole 海角视频 supplier of both products, until Morningside entered the market in mid-2014.
It said: “When Morningside started supplying the drug, this was not followed by the price falls that would normally be expected when a new competitor enters the market.”
The CMA will consider representations from the companies under investigation before deciding if the law was broken.
Leicestershire retail news
Don’t miss
Ann Pope, the CMA’s senior director of antitrust, said: “Drug companies that break competition law risk forcing the NHS, and 海角视频 taxpayers, to pay over the odds for important medical treatments.
“We’ve provisionally found that suppliers of this important antibiotic entered into arrangements with the aim of keeping Nitrofurantoin capsule prices artificially high, meaning the NHS wouldn’t benefit from the lower prices that come from effective competition.”
The CMA said no conclusion should be drawn yet that there had been any actual breach of competition law.
A spokesman for Morningside, which is based in Castle Business Park, Loughborough, said: “While Morningside Pharmaceuticals and Morningside Healthcare (Morningside) strongly refute the concerns raised by the CMA in its Statement of Objections, we will continue to work constructively with them to demonstrate Morningside’s commitment to patient choice and a competitive market.”
A statement from Advanz Pharma said: “We are committed to ensuring continued access to high quality, niche-established medicines for patients in the 海角视频, and providing many medicines that offer significant savings to the NHS.
“We take competition law very seriously and do not believe that competition law has been infringed.
“We will review the CMA’s preliminary position, as specified in its SO, and we plan to respond in detail as we continue to work constructively with the CMA.”
An Alliance Healthcare spokesman said: “A Statement of Objection is a provisional view only by the CMA that a competition law infringement may have occurred.
“It is not a finding of infringement nor does it necessarily lead to an infringement decision.
“We take competition law very seriously and do not believe that competition law has been infringed.
“We will review the CMA’s provisional position, as specified in its Statement of Objections, and we plan to respond in detail to these allegations and defend our position whilst working constructively with the CMA.”
The CMA can impose a fine on any business found to have infringed the law, with the figure depending on factors including the seriousness of the infringement, turnover in the relevant market and any mitigating or aggravating factors.
It currently has investigations open in relation to seven different drugs.