European Commission investigates Aspen for ‘price gouging’

The European Commission has opened an investigation into multinational company Aspen Pharma over the price of five cancer drugs.

According to a statement released on Monday, May 15, the Commission will investigate whether Aspen has abused a dominant market position in breach of EU competition rules.

The investigation of Aspen is the Commission’s first probe concerning excessive pricing practices in the pharmaceutical industry.

Some of the active ingredients in the drugs are chlorambucil and melphalan, and the drugs are sold with different formulations and multiple brand names.

Aspen acquired the investigated drugs after their patent protection expired.

The Commission said it has information that in order to impose the price increases, Aspen has threatened or gone through with withdrawing the drugs in some countries.

The Commission added that Aspen’s actions may be in breach of the EU’s competition rules, as well as article 54 of the European Economic Area Agreement (EEA), both of which forbid the imposition of unfair prices or unfair trading conditions on customers.

Margrethe Vestager, in charge of competition policy, said: “When we get sick, we may depend on specific drugs to save or prolong our lives. Companies should be rewarded for producing these pharmaceuticals to ensure that they keep making them into the future.

“But when the price of a drug suddenly goes up by several hundred percent, this is something the Commission may look at. More specifically, in this case we will be assessing whether Aspen is breaking EU competition rules by charging excessive prices for a number of medicines.”

The investigation will be carried out in all of the EEA countries except Italy, as the Italian competition authority already decided in September last year that Aspen infringed the competition regulations in the country.

Aspen received a fine of €5 million ($5.6 million) from the Italian authority, as it was found to have increased its prices in amounts ranging from 300% to 1,500%.

Aspen said in a statement: “While Aspen is not currently in a position to comment on these proceedings, it reaffirms its commitment to fair and open competition in markets in the European Union and around the world.”

The company added: “Aspen takes compliance with competition laws very seriously and will work constructively with the European Commission in its process.”

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