Indian-origin pharma boss banned for price-fixing in UK

Aditi Khanna

London, Jun 5 (PTI) An Indian-origin pharmaceutical industry chief has signed undertakings that ban him from holding a director role at any UK company for the next five years, in connection with his role in companies that were allegedly involved in illegal arrangements such as price-fixing of drugs.

Amit Patel, a former director at the pharmaceutical companies Auden McKenzie and Amilco, was the subject of a UK Competition and Markets Authority (CMA) investigation, which concluded with the ban on Thursday.

'Company directors have a responsibility to make sure their companies comply with competition law. And the CMA is determined to protect the public from directors who fail to do so,' said Michael Grenfell, the CMA's Executive Director of Enforcement.

'Today's action should act as a warning to those in management positions – the CMA will not stand by when your firms break the law and take advantage of customers,' he said.

From September 2014 to May 2015, when Patel was director at Auden McKenzie, the CMA investigation found that Auden McKenzie and King Pharmaceuticals Ltd had shared out between them the supply of the drug nortriptyline to a large pharmaceutical wholesaler.

The UK's state-funded National Health Service (NHS) prescribed drug is used by thousands of patients to relieve the symptoms of depression. The CMA found that the two companies agreed that King would supply only 25mg tablets and Auden Mckenzie only 10mg tablets and they also agreed to fix quantities and prices to the wholesaler.

'The object of this agreement was to limit competition, meaning the NHS – and ultimately the taxpayer – could have been paying higher prices than if competition hadn't been restricted by the agreement,' the CMA said.

In relation to Amilco, Patel admitted that from March 1 to October 19, 2016, his company and another pharmaceutical company Tiofarma stayed out of the UK fludrocortisone market enabling market-leader Aspen to maintain its position as the sole supplier for the UK.

Fludrocortisone is a prescription-only medicine that patients rely on to treat primary or secondary adrenal insufficiency, commonly known as Addison's Disease, and the CMA has alleged that this illegal agreement protected Aspen's monopoly, giving it an opportunity to increase prices charged to the NHS by up to 1,800 per cent.

The CMA said that Patel has now admitted that, in exchange for staying out of the market, Amilco received a 30 per cent share of the increased prices that Aspen was able to charge.

'Amit Patel will now be disqualified from taking up any director role or being involved in the management of any company based in England, Scotland or Wales for five years. Consistent with his admission, Mr Patel has also withdrawn his appeal against the CMA's nortriptyline decision,' it said.

The Competition Appeal Tribunal gave Patel permission to withdraw his appeal against the CMA's decision relating to agreements affecting the supply of nortriptyline earlier this week.

'This relates to events some years ago. I have cooperated with the CMA and voluntarily given undertakings to conclude this case,” Patel said.

As part of the Company Directors Disqualification Act, the CMA can seek the disqualification of any director where their company has broken competition law. The Act also allows the CMA to accept a disqualification undertaking from a director instead of bringing proceedings, which has the same legal effect as a disqualification order. A disqualification can also come before a company is found to have broken competition law.

The CMA said that Patel's 'serious breaches' would have merited a disqualification of at least six years. However, it agreed to reduce this to five years, given the public interest benefit of securing an immediate disqualification, without the time and cost of court proceedings. PTI AK MRJ AKJ MRJ