Aspen faces EU probe over excessive pricing of cancer drugs
Brussels — Aspen Pharmacare faces a EU antitrust investigation for ramping up the price of cancer drugs as the EU joins a global crackdown on the soaring cost of life-saving generic medicines.
"When the price of a drug suddenly goes up by several hundred percent, this is something the commission may look at," EU competition commissioner Margrethe Vestager said in an e-mailed statement on Monday.
The EU’s first investigation into so-called excessive pricing of medicines follows Italian and British action against pharmaceutical price increases. US officials have been looking at the pricing of generic medicines for more than two years, triggering civil lawsuits from customers who say they were overcharged. The EU can impose fines of as much as 10% of a company’s annual revenue.
The prices of more than a dozen generic cancer treatments more than doubled between 2011 and 2016 in the UK, even as the country’s National Health Service (NHS) took aim at expensive new targeted tumour drugs. Such cases have up-ended common perception that prices of critical medicines will fall only after patents expire and drug makers have recouped costs.
Aspen shares fell as much as 3% and were down 2.5% at R278.64 as of 12:57pm in Johannesburg. Shares tumbled in April on a UK newspaper report of a dispute on pricing with Spanish authorities.
Aspen said it "takes compliance with competition laws very seriously and will work constructively with the European Commission in its process", according to a statement.
Africa’s largest maker of generic medicines, which also sells products such as hormones, infant formula and antiretroviral medicines in more than 150 countries, said in March it expected drug prices, especially in Europe, to come under pressure.
The EU said it was investigating Aspen’s pricing practices for medicines using the active pharmaceutical ingredients chlorambucil, melphalan, mercaptopurine, tioguanine and busulfan. They are used to treat cancer and sold in different formulations and under multiple brand names. Aspen acquired them after initial patents expired.
Regulators said they would check whether Aspen conducted "so-called price-gouging" by imposing price increases of up to several hundred percent. The EU says it has been told Aspen threatened to withdraw medicines in some countries and "has actually done so in certain cases".
The investigation covers all of the European economic area except Italy where the country’s antitrust authority fined the company €5m in 2016 for raising prices on cancer drugs by as much as 1,500% starting in 2014. That related to an anti-tumour drug package Aspen bought from GlaxoSmithKline, a former shareholder.