Drug giants 'swindle NHS by blocking cheap medicines' extending patents

Britain's research-based pharmaceutical industry has been accused of using devious tactics to extend the life of drug patents, costing the NHS millions of pounds.

Manufacturers of generic medicines – cheap copies of brand-name drugs – hit out at the tactics adopted by major pharmaceutical companies of "evergreening" products to maintain their monopoly on the market after a patent expires.

The allegations were made as the makers of an indigestion remedy, Gaviscon, launched an internal investigation after being accused of cheating the NHS.

Internal documents obtained by the BBC's Newsnight programme allegedly showed that executives at Reckitt Benckiser, the manufacturer of Gaviscon, schemed to create obstacles to prevent cheap generic versions. Generic copies of Gaviscon could have saved the NHS £40m since 1999, Newsnight claimed.

Warwick Smith, director of the British Generic Manufacturers Association (BGMA), said: "The sort of evergreening alleged by Newsnight can cost the NHS tens of millions of pounds with no patient benefit. New drugs get a long period of monopoly in which to make a return on their investment in research. Delaying generic competition weakens the NHS, costs the taxpayer and undermines patient care."

Reckitt Benckiser said in a statement: "We are shocked by the allegations ... and by the inappropriate sentiment expressed in some of the internal correspondence of 2003. Reckitt Benckiser is a responsible company and we have therefore instigated an immediate internal investigation and will take action. However, we do not accept much of what has been alleged."

In evidence to the Commons Health Select Committee in 2004, the BGMA cited five drugs which their manufacturers had tried to "evergreen" before their patents expired. In one case, the manufacturer of the blood pressure drug Ramipril attempted to switch it from capsule to tablet form three months before its patent expired in 2004. Computers used by GPs listed tablets, scuppering attempts by generic manufacturers who were geared up to produce capsules.

The BGMA said that had action not been taken, the delay in introducing a generic version could have cost the NHS £70m.

In its report, the select committee called for a "systematic review of so-called evergreening and other practices that impede the entry of generic drugs on to the market".

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