Robin Pagnamenta
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Three leading drug companies are set to ignore a continuing Office of Fair Trading (OFT) competition inquiry by pressing ahead with sweeping changes to the way in which prescription medicines are distributed to patients across Britain.
On October 1, NAPP Pharmaceuticals, a supplier of pain relief including diamorphine, switched to an exclusive distribution arrangement with Unichem, the wholesaling arm of Alliance Boots, and AAH and Phoenix, two other pharmaceutical wholesalers.
Sanofi Aventis, of France, the world’s third-largest drugs company, will introduce a similar regime on November 1. Schering Plough, of the United States, is expected to adopt similar arrangements early next year.
By restricting the distribution of their products to Britain’s pharmacists, hospitals and dispensing doctors to a handful of suppliers, the changes represent a fundamental shift in the way in which lifesaving medicines reach patients.
Before this, manufacturers have sold their products to a range of wholesalers, who then competed against one another on price.
The changes will increase the manufacturers’ control over drug-pricing in the UK and have raised monopoly fears.
Critics claim that they could present a threat to patient safety by raising the possibility of potentially life-threatening delays if individual wholesalers run short of specific products.
The changes are being made despite an OFT investigation into competition in the UK drug wholesale market.
Martin Sawer, of the British Association of Pharmaceutical Wholesalers, said that he was “very disappointed” that some manufacturers had decided to introduce the changes before the OFT had published its report.
“It would have been much better if they had waited,” he said. “It could make things even more complicated.”
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 patients”.
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 wholesaling”.
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.
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.
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