Drugmakers To UK Watchdog: In Your Eye
Make a commentBy Ed Silverman // October 7th, 2007 // 11:52 pm
Two more drugmakers plan to use an exclusive distribution arrangement for their meds in the UK. Schering-Plough and NAPP Pharmaceuticals are expected to follow Pfizer and use just three wholesalers - AAH, Phoenix and UniChem, according to The Times of London. Last July, Sanofi-Aventis also announced the same move will occur shortly.
The planned moves come even as the UK’s Office of Fair Trading is conducting an investigation into accusations the switch will reduce competition and have raised monopoly fears. Smaller wholesalers and some docs say the tactic is really a bid to fight parallel trade, a legal practice in Europe in which meds can be imported for resale into the UK.
Critics also claim the new arrangements could present a threat to patient safety by raising the possibility of potentially life-threatening delays if individual wholesalers run short of specific products. Before this, drugmakers sold their products to a range of wholesalers, who then competed against one another on price.
Martin Sawer, of the British Association of Pharmaceutical Wholesalers, says he’s “very disappointed†that some drugmakers had decided to introduce the changes before the OFT had published its report. “It would have been much better if they had waited,†he tells the paper. “It could make things even more complicated.â€
When the OFT announced its study in April, it said that it would examine “how recent and proposed changes to distribution arrangements may affect competition, the NHS and patientsâ€. The OFT said that the review, which was launched after Pfizer’s controversial decision to appoint Unichem as its sole UK distributor last year, would examine the motivation for the changes and their “impact on competition and choice in wholesalingâ€.
The OFT is expected to publish its recommendations in December. The Department of Health will have 120 days to respond. By appointing three distributors, Sanofi and NAPP can make the claim that there will be an element of price competition, The Times notes. AstraZeneca recently suspended its plans to opt for a model using only two distributors, although a spokesman denied that the decision had been related to the OFT inquiry.