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Lexon UK to pay £1.2m fine for breaking competition law after appeal dismissed

Covid costs

By Isabel Shaw
Reporter

01 Mar 2021

The Competition Appeal Tribunal (CAT) has dismissed Lexon (UK)’s grounds of appeal and has upheld the Competition and Markets Authority’s (CMA) earlier finding that the pharmaceutical company broke competition law over the supply of nortriptyline.

Last year, an investigation conducted by the CMA into the supply of the antidepressant found three pharmaceutical companies had illegally shared commercially sensitive information to try to keep nortriptyline prices up.

The investigation resulted in fines of more than £3.4 million, of which Lexon (UK), one of the companies involved, was to pay £1,220,383, a statement from the CMA said.

However, Lexon (UK) maintained it had not broken the law and instead appealed against the decision and the fine, the CMA said.

After a tribunal held in November, the CAT has now unanimously dismissed all of Lexon (UK)’s appeal, upholding the CMA’s previous finding that the firm broke competition law.

Commenting on the CAT’s decision, Andrea Coscelli CMA’s CEO said: ‘Lexon illegally exchanged competitively-sensitive information to try and keep prices up, meaning the NHS – and ultimately the UK taxpayer – could have been paying over the odds for this important drug.

‘Such behaviour is unacceptable. We will continue to crack down on companies that seek to break the law and will be keeping a close eye on this sector.’

Lexon (UK) Ltd was approached for comment.

CMA investigation

The CMA’s original investigation found that between 2015 and 2017 – when the cost of nortriptyline was falling – Lexon (UK) Ltd, King Pharmaceuticals Ltd and Alissa Healthcare Research Ltd ‘exchanged information about prices, the volumes they were supplying, and Alissa’s plans to enter the market’.

In September 2019, King Pharmaceuticals Ltd and Alissa Healthcare Research Ltd both admitted to breaking the law and were fined £75,573 and £174,912 respectively, the CMA said.

According to the CMA, the investigation also found that, rather than competing, King Pharmaceuticals Ltd and another company Auden Mckenzie (Pharma Divison) Ltd ‘shared out between them the supply of nortriptyline to a large pharmaceutical wholesaler’.

From September 2014 to May 2015, the two companies ‘agreed that King would supply only 25mg and Auden Mckenzie only 10mg tablets’ and the firms also ‘colluded to fix quantities and prices’, the CMA said at the time.

King Pharmaceuticals Ltd and Auden Mckenzie admitted breaking the law and both King and Accord-UK Ltd – the company which later took control of Auden Mckenzie’s nortriptyline business – were fined £75,573 and £1,882,238 respectively.

Accord-UK Ltd and Auden Mckenzie also agreed to make a £1m payment to the NHS in connection with the case.


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