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Two pharmaceutical companies, Pfizer and Flynn Pharma, have been fined a total of almost £70 million for overcharging the NHS for epilepsy drug phenytoin sodium.

Pfizer was fined £63 million and Flynn Pharma £6.7 million after further investigation by the Competition and Markets Authority (“CMA”) found that both firms had “abused their dominant positions” to charge “unfairly high prices” for the anticonvulsant drug over a 4-year period.

Manufacturer Pfizer supplied the drug to Flynn – its UK distributor – who sold the phenytoin capsules on to wholesalers and pharmacies. The CMA first intervened when the companies imposed a substantial hike in the price of the drug in 2012, “despite there being no material change in the underlying costs”. The firms de-branded the drug, previously called Epanutin, meaning that it was no longer subject to price regulation.

The CMA said that for four years Pfizer charged prices between 780% and 1600% higher than previously, while Flynn charged its customers between 2300% and 2600% more than the prices previously charged by Pfizer.

As a result, the annual cost to the NHS for phenytoin capsules increased from £2 million in 2012 to approximately £50 million in 2013.

The CMA said that following further analysis, it determined that the companies’ behaviour was an abuse of their dominant positions in their respective markets and that both Pfizer and Flynn charged unfair prices for phenytoin capsules.

Andrea Coscelli, chief executive of the CMA, said: “Phenytoin is an essential drug relied on daily by thousands of people throughout the UK to prevent life-threatening epileptic seizures. These firms illegally exploited their dominant positions to charge the NHS excessive prices and make more money for themselves – meaning patients and taxpayers lost out.

“Such behaviour will not be tolerated, and the companies must now face the consequences of their illegal action.”

Read more: Pharma Companies Fined £70 Million for Overcharging the NHS, Medscape, 22 July 2022

The latest decision by the CMA stems from the CMA’s original investigation in 2016 following which the CMA issued an infringement decision – finding that the companies’ behaviour broke competition law.

The CMA and Flynn then appealed to the Court of Appeal. In March 2020, the Court dismissed Flynn’s appeal in its entirety and upheld aspects of the CMA’s appeal relating to the application of the legal test for unfair pricing. Following this, the CMA decided to re-investigate the matters remitted by the CAT and opened its current investigation in June 2020.

After the CMA issued its original fine of £84.2m, Pfizer’s objections and several years of legal wrangling led the UK watchdog to re-open its investigation and a 2021 CMA decision was part of a crackdown on illegal behaviour by drug companies overcharging the NHS. In July 2021, the CMA fined several companies linked to Auden Mckenzie and Actavis UK, now known as Accord-UK, a total of £260m for inflating the price of essential drug hydrocortisone, and fined Advanz and its former private equity owners more than £100m for inflating the price of liothyronine, used to treat thyroid hormone deficiency, by up to 6,000%.

Read more: UK watchdog: Pfizer and Flynn Pharma overcharged NHS, PM Live, 6 August 2021

Who is Flynn Pharma?

We attempted to find more information about Flynn Pharma but at the time of writing their website was “under development”.

Although a link to Pulse Live is returned when an internet search is conducted for Flynn Pharma, the link leads to their home page with a cumbersome “browse” function that doesn’t allow for easy search.  We were unable to find Pulse Live’s reference to Flynn Pharma on their website. However, the tag line on the internet search gives a brief description, or part of it:

We were able to establish who the person with significant control in Flynn Pharma is: Jos Clemens Ensink, of Dutch nationality and resident in Guernsey, owns more than 25% but not more than 50% of the shares in Flynn Pharma (Holdings) Limited. There is little else about Ensink available on the internet.

And as declared in the latest financial statements filed by the company, its subsidiaries are Flynn Pharma Limited, Republic of Ireland; Inresa Arzneimittel GmbH, Germany; and, Micropharm Limited, UK.