The Competition and Markets Authority (CMA) has alleged that Concordia and Actavis UK signed illegal agreements enabling high prices for a life-saving drug to be prolonged.
The two pharmaceutical firms have been accused of fixing the market for hydrocortisone tablets.
The CMA alleges that between January 2013 and June 2016, Actavis UK incentivised Concordia not to enter the market with its own competing version of hydrocortisone. Over that period, the cost of the drug to the NHS rose from £49 to £88 per pack.
Under the agreements, Actavis UK instead supplied Concordia with a fixed supply of its own 10mg tablets for a very low price for Concordia to sell onto UK customers.
In a statement of objections issued to the parties today, the CMA also said that Actavis UK abused its dominant position by inducing Concordia to delay its independent entry into the market.
It has provisionally found that the agreements enabled Actavis UK to prolong the high prices in the market "depriving the NHS of the significant price falls that would be expected to result from true competition".
Andrew Groves, CMA senior responsible officer, said:
Anti-competitive agreements can cost the NHS, and ultimately the taxpayer, by stopping competition bringing down the cost of lifesaving drugs like hydrocortisone tablets.
We allege these agreements were intended to keep Actavis UK as the sole supplier of a drug relied on by thousands of patients – and in a position which could allow it to dictate and prolong high prices.
As always at this stage in an investigation, these findings are provisional and no conclusion should be drawn at this stage that there has in fact been any breach of competition law. We will carefully consider any representations of the companies under investigation before determining whether the law has been infringed.