Glaxo accused of paying off competitors

GlaxoSmithKline (GSK) is being investigated over claims it paid off firms to delay the launch of cheap versions of its anti-depression drug, according to reports Friday.

GlaxoSmithKline (GSK) is being investigated over claims it paid off firms to delay the launch of cheap versions of its anti-depression drug, according to reports Friday.

The UK's Office of Fair Trading (OFT) said GSK offered payments to Alpharma, Generics and Norton Healthcare, to postpone the release of rival medicines to its Seroxat treatment.

The move denied the NHS significant cost savings, OFT alleged.

GSK has been accused of abusing its dominant position in the market and breaking competition law.

GSK's competitors were set to introduce a generic paroxetine product but they were suspected of infringing patents.

In order to resolve the dispute, they agreed to be paid off by GSK, the OFT said. They are also being probed for allegedly overstepping competition law.

"The introduction of generic medicines can lead to strong competition on price, which can drive savings for the NHS, to the benefit of patients and, ultimately, taxpayers," said Ann Pope, Senior Director of Services, Infrastructure and Public Markets at the OFT.

"It is therefore particularly important that the OFT fully investigates concerns that independent generic entry may have been delayed in this case."

GSK said it was co-operating with the OFT in its investigation which covers activities between 2001 and 2004.

"GSK supports fair competition and we very strongly believe that we acted within the law, as the holder of valid patents for paroxetine, in entering the agreements under investigation," the group said in a statement.

"These arrangements resulted in other paroxetine products entering the market before GSK's patents had expired."

Seroxat, one of GSK's best-selling medicines, has been whacked by generic competition in recent years. Sales fell 14% in 2012 to £374m and by nearly a fifth in the final three months of last year.

Last year the company was fined $3.0bn in the US for paying medics to prescribe the drug for children even though was not intended for under 18s.

RD

Recommended

The top funds to invest in
Funds

The top funds to invest in

As market volatility and recessionary fears continue, here are the most popular funds, stocks and trusts investors are putting their money into
2 Mar 2023
The ten highest dividend yields in the FTSE 100
Income investing

The ten highest dividend yields in the FTSE 100

Rupert Hargreaves takes a look at the companies with the highest dividend yields in the UK’s blue-chip index
27 Feb 2023
The outlook for Shell shares is mixed, despite bumper profits
Energy stocks

The outlook for Shell shares is mixed, despite bumper profits

With profits surging, it looks as if Shell is on a roll, but the company’s growth from here is hard to see as Rupert Hargreaves explains.
6 Feb 2023
The top ten dividend stocks in the FTSE 250
Share tips

The top ten dividend stocks in the FTSE 250

The average FTSE 250 dividend yield is around 4%, but many stocks yield much more. Rupert Hargreaves picks the best FTSE 250 stocks for income investo…
17 Jan 2023

Most Popular

Where will house prices go in 2023?
House prices

Where will house prices go in 2023?

We explore what could happen to house prices in 2023 as the market continues to slow down.
24 Mar 2023
Will energy prices go down in 2023?
Personal finance

Will energy prices go down in 2023?

Ofgem’s price cap is now predicted to fall below £2,000, based on average typical use, from July, for the first time since 2022. We have all the detai…
21 Mar 2023
5 top UK tech stocks
Investments

5 top UK tech stocks

The UK market has never been considered a fertile hunting ground for tech stars. But there are plenty of promising companies beyond the old economy, s…
23 Mar 2023