UK assails Pfizer-type distribution

It's not fair. That's what the UK's Office of Fair Trading is saying about Big Pharma's new, streamlined distribution in that country. The OFT says it fears the National Health Service will pay more for meds under the arrangements, in which Pfizer, AstraZeneca, and others have limited their distribution to one or two wholesalers.

The new distribution deals are known as direct-to-pharmacy, and they allow manufacturers to set the retail prices of their products; distributors are paid a fee for delivering the meds. Traditionally, wholesalers would buy medicines at a discount on retail prices, and then compete with one another to supply pharmacies, often by undercutting competitors' prices. The OFT says it fears that DTP distribution will boost drug prices, costing the National Health Service millions.

Pfizer says that its exclusive distribution deal with UniChem won't increase the NHS's costs, but that it will ensure a "secure supply" of Pfizer drugs.

- see the report from OFT (.pdf)
- read this article from the Financial Times
- get more in The Telegraph