Home Business Hydrocortisone - The NHS As Idiot Shopper

Hydrocortisone – The NHS As Idiot Shopper

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The pharma companies involved here have been fined and fined heavily for what they did. Hmm, seems fair enough. But this doesn’t go far enough. Those in the NHS – and quite possibly the drug licensing people – who allowed this to happen also need to be fired, pensions confiscated and the full panoply of punishments deployed in order to stop it happening again.

The UK’s competition watchdog has imposed fines totalling more than £260m on pharmaceutical companies after an investigation found that they overcharged the NHS for hydrocortisone tablets for almost a decade.

The Competition and Markets Authority (CMA) found that the drug’s makers Auden Mckenzie and Actavis UK, now known as Accord-UK, used their position as the sole providers of hydrocortisone to inflate the price of the drug. Tens of thousands of people in the UK depend on hydrocortisone tablets to treat adrenal insufficiency, which includes life-threatening conditions such as Addison’s disease, the CMA said.

The investigation found that the companies were able to inflate the price of hydrocortisone tablets by over 10,000% compared with the original branded version on sale in 2008. This meant the amount the NHS had to pay for a single pack of 10mg tablets rose from 70p in April 2008 to £88 by March 2016.

There’s no patent on hydrocortisone. There’s no public policy goal in restricting who may – as long as they meet standards of course – manufacture it. We should be in a competitive market here. Producers will make a profit – they’ll pay their cost of capital – and not make economic profits.

So, why didn’t this happen?

Well, yes, in the first instance it’s because those producers cheated their way into not having any competition. But they did so in the UK only. They are by no means that only global suppliers of such a basic product.

So, why didn’t the NHS buy from those others who would supply at a better price? The assumption has to be that the NHS purchasing department is staffed by idiots. OK, that’s several P 45s sorted out then.

Hmm, what’s that? It’s not them? Then it must be the drug approval people. Who would have some set of hoops through which a UK supplier must jump. For something as simple and known as hydrocortisone. And end up only allowing the one or two companies to jump through said hoops.

The answer to this is that anyone licenced by any respectable agency is, by definition, licenced to supply in the UK. After all, the way to beat someone cornering the market is to flood the market with supply, no?

So, if it’s not the NHS idiots who should be fired then it’s the drug regulators.

Is this happening? Nope – so it’s going to happen again, isn’t it?

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4 COMMENTS

  1. “The assumption has to be that the NHS purchasing department is staffed by idiots”

    Maybe an investigation into their UK and offshore bank accounts might be in order?

  2. Maybe that supplier was the only one prepared to jump through the hoops necessary to fill in a form to put in a tender to supply the NHS. Maybe they didn’t care if they got the business so adjusted the price to suit.

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