Canadian drug giant Concordia overcharged the NHS by millions of pounds, Britain's competition regulator provisionally found today.
It is alleged the firm hiked the price of one the NHS's essential thyroid drugs.
Last year, the NHS spent more than £34m on the medication, called liothyronine, an increase from £600,000 in 2006.
The Competition and Markets Authority said: "The amount it paid per pack rose from around £4.46 before it was de-branded in 2007 to £258.19 by July 2017, an increase of almost 6,000 per cent, while production costs remained broadly stable."
Concordia hit back, saying it did not believe competition law had been "infringed" but that it would consider the CMA's findings and respond in further detail. The firm insisted it is "co-operatively" working with the CMA.
Concordia stated: "The pricing of liothyronine has been conducted openly and transparently with the Department of Health in the UK over a period of ten years. Over that time, significant investment has been made in this medicine to ensure its continued availability for patients in the UK."
Liothyronine is primarily used to treat hypothyroidism, a condition caused by a deficiency of thyroid hormone affecting at least two in every 100 people and which can lead to depression, tiredness and weight gain. The drug is not the first port of call but for many patients there is no "suitable alternative", the CMA said.
Until earlier this year Concordia was the sole supplier of the medication.
CMA chief executive Andrea Coscelli said:
Pharmaceutical companies which abuse their position and overcharge for drugs are forcing the NHS – and the UK taxpayer – to pay over the odds for important medical treatments.
We allege that Concordia used its market dominance in the supply of liothyronine tablets to do exactly that.
Today's findings are provisional and the CMA will consider further company representations before reaching a final conclusion.