CMA Investigations And Timeline of UK Drug Price ScandalI have investigated the evolution of the Drug Price Scandal in the UK to the best of my abilities. Below are my findings. I do have reason to believe that there may already be a CMA (Competition and Markets Authority) case open on the matter, and will outline my reasoning as to why.
The story was actually "broken" by a Cumbria pharmicist Ben Merriman in a letter on September 10, 2015 in a pharmaceutical journal:
https://www.pharmaceutical-journal.com/opinion/correspondence/price-increase-after-debranding-of-branded-products/20069195.article The timing to the release of September 8, 2015 of CXR acquiring AMCo is curious, however it doesn't look as if there is any relation to the stories. AMCo is not mentioned and the pharmacist was responding to an article about the open investigation at the time on phenytoin capsules.
This was followed by two articles in The Sunday Times (The London Times) on October 25, 2015:
https://www.thesundaytimes.co.uk/sto/news/uk_news/article1623981.ece#commentsStart And On November 1:
https://www.thesundaytimes.co.uk/sto/news/uk_news/Health/article1627126.ece Now in the second article it says the following:
"In response, the Department of Health said it was “seeking views on powers to limit the prices of generic medicines where there is no competitive market”."
As well as:
"Paul Flynn, Labour MP for Newport West, said: “The research on most of these was completed and paid for decades ago. It’s unashamed profiteering.”"
This would have given the CMA incentive and plenty of time to open a case on this. In fact there is a current CMA investigation into "Pharmaceutical Sector Anti-Competitive Practices" that was opened on March 8.
https://www.gov.uk/cma-cases/pharmaceutical-sector-anti-competitive-practices I emailed those responsible for this investigation to find out when they post open investigations as well as when the names of the companies are released. Here is the response I received from James MacBeth:
"Classification:
Official Dear Marcel,
I’m afraid that at this stage I can’t provide you with any further details about the parties or the details of the investigation. Our case page which will be periodically updated with information.
It is usual for parties to be first named when (and if) we issue a Statement of Objections. Occasionally there are circumstances for naming a party earlier but this is not common.
We put fact of the investigation (by way of a case page) in the public domain when the investigation becomes known to the party or parties under investigation.
I hope that helps.
Yours sincerely,
James"
Now given that the Secretary of Health demanded that they urgently investigate The Times new allegations (which are not in fact new, but date back to October of 2015), one would think that the CMA would move relatively quickly to at least open up a file for this investigation. Seeing as they have not opened a new file, it is not unreasonable to think that there are no new case because there is already one open on this matter.
If that is the case, perhaps this is the motivation for a buyout? Also, if it were the case those looking to buy the company would almost certainly be aware of this. What I need to confirm is with Investor Relations, as to whether AMCo is being investigated by the CMA, whether they would be required to disclose this, or whether they are only required to disclose it in the event of the CMA issuing a Statement of Objections, as at the moment it would only be the preliminary fact finding portion of the investigation.
Also something to consider, it took over two YEARS in the Pfizer case for a statement of objection to be issued (Opened May 2013, Statement of Objection issued August 2015)
Anyone's thoughts or insights into this are welcome.
Marcel