The OFT has found that competition has increased in the sustained release morphine market, ten years after it imposed restrictions and a landmark fine (the OFT’s first under Chapter II of the Competition Act 1998) on Napp Pharmaceuticals (Napp).
In the 2001 case, the OFT found that Napp had abused its dominant position by supplying sustained release morphine products to hospitals at discounted rates. In particular Napp targeted the discounts at products that had the most competition; the effect of which was to sustain Napp’s high shares and, in one instance, force a competitor to exit the market.
The review, which is the first of its kind, concluded that the OFT's intervention stimulated entry into the market and reduced Napp's market share in the hospital segment from 95 percent to 50 percent, and its share in the community segment from 95 percent to 65 percent. Napp's list price for its sustained release morphine products has also reduced by approximately 25 per cent.
The OFT has committed publicly to evaluate at least two of its previous interventions each year.