Drugs firms are accused of putting cancer patients at risk over price hikes

Drug companies have been accused of profiteering by raising the prices of out-of-patent cancer medicines that cost just pence to make, inflating the bills of the cash-strapped NHS by hundreds of millions of pounds.

Academics say the prices of 14 cancer drugs have increased by between 100% and nearly 1,000% over the past five years in the UK. These are all generic drugs where the patent has expired, which means they can be made for little more than the cost of the raw ingredients.

But, say experts who presented their findings at the European Cancer Congress in Amsterdam, generic drug companies have been price-gouging, just as Turing Pharmaceuticals was found to have done in the US with Daraprim, a 70-year-old drug used in Aids treatment. The price rose from $13.50 to $750 to universal outrage and became an issue in the presidential election. Turing CEO Martin Shkreli was dubbed the most hated man in America.

Andrew Hill from the department of pharmacology and therapeutics at the University of Liverpool, said the price increases in the UK would be costing the NHS a huge amount of money at a time when it has said it may have to ration 20% of the very expensive new cancer drugs coming on the market. “This figure will probably be in the high hundreds of millions of pounds per year, or possibly £1 billion,” he said.

He and co-author Melissa Barber, from the London School of Hygiene and Tropical Medicine, funded by the World Health Organisation and the Open Society Foundation,, could not calculate the exact costs to the NHS because they did not have access to data from hospitals, where cancer drugs are usually prescribed. But they also looked at the increase in prices of all types of generic drugs – not just cancer – prescribed by GPs and pharmacists and found that the NHS paid £380m more in 2015 than it had five years earlier, as generic companies pushed up their prices. The hospital bill is likely to be much more.

Hill said the rises were going unnoticed because they were “under the radar”. The NHS was not keeping an eye on the steady increases year on year. “They are not negotiating well enough,” he said. “They should be looking at any company that starts raising the price of any drug.”

Among the drugs with price rises is melphalan for ovarian cancer, a drug invented by the UK company GlaxoSmithKline and then passed with a number of other cancer drugs that were going out of patent to Aspen Pharmaceuticals, a South Africa-based generics company, in 2009. GSK took a 16% shareholding in Aspen at the time.

Hill and Barber say the price of melphalan in the UK went up from 55p for 2mg in 2011 to £1.82 in 2016, a rise of 230%. The NHS did not contest it, unlike in Italy. There, Aspen negotiated a deal in 2014 to raise the price of the drug by up to 1,500%, having threatened to stop supplying the ovarian cancer drug to patients altogether. The Italian competitions authority fined the company nearly $5.5m last October for its behaviour. “The negotiation strategy adopted by Aspen was so aggressive as to reach the credible threat of interrupting the direct supply of the drugs to the Italian market,” said the authority’s report.

Australia, New Zealand, France and Brazil have also faced shortages of Aspen’s drug, says Hill. Aspen did not return calls asking for the reason for the shortages. In France, three women died after being given an alternative drug to melphalan. The drug, cyclophosphamide, should have been safe, because it was used before melphalan came on the market. An investigation is now under way into what happened.

The biggest price rise in the UK that the team found was also for an Aspen drug. The cost of busulfan for chronic myeloid leukaemia to the NHS rose from 21p for 2mg in 2011 to £2.61 in 2016, an increase of 1,143%.

Aspen’s share price rose more than 650% from 2009 to last year. GSK sold its shares in Aspen in three tranches – the last one in September – netting about £1.5bn.

The multinational Pfizer was fined £84m in the UK in December for conspiring with a generic company, Flynn Pharma, to raise the price paid by the NHS by 2,600% for an anti-epilepsy drug that came off-patent. The Competitions and Markets Authority said it had exploited the fact that the NHS had no alternative, because no other company was making it. In the wake of that case, a bill is going through parliament to give the Department of Health powers to investigate when the price of a drug goes up without clear justification.

Sarah Wollaston, the Tory MP who chairs the health select committee, said the research findings were concerning. “It is unacceptable for drug companies to artificially inflate the cost of drugs. This will inevitably result in less funding being available for other vital treatments,” she said.

The chairman of the European Cancer Organisation’s patient advisory committee, Ian Banks, said at the conference that the price rises were more than outrageous. “Behind these statistics there is a patient not getting treatment that could save their lives or at the very least improve their quality of life. That is unacceptable,” he said.

Mia Rosenblatt from Breast Cancer Now said: “We’d be extremely concerned by any suggestion of companies raising the price of tamoxifen and other generic drugs, which would only add to the current strain on the NHS.

“Part of the understanding – by health bodies – of the high cost of new drugs is based on the knowledge that there is a limited time for drug companies to see return on their investments and that these drugs will be available at a much cheaper rate in due course.

“Significant driving up of the prices of generic drugs would be of real concern and we therefore support the government’s activity to address this possibility through the Health Services Medical Supplies Bill.”

The British Generic Manufacturers Association said that most of the drugs highlighted in the study had no competition, because there was only one supplier. “That is because the total market size is too small to be attractive for generic companies to enter, since they would not recoup the million-pound plus costs of developing, testing and registering a new generic medicine,” it said in a statement.Hill countered that the cost of developing a new generic drug is not high and that cheaper versions than those sold to the NHS could be imported from India.

• This article was amended on 29 January 2017 to make it clear that Ian Banks was speaking as a representative of the European Cancer Organisation’s patient advisory committee.