The UK’s pharmaceutical industry is being targeted by anti-trust probes by the European Commission and the US Securities and Exchange Commission.
The US Department of Justice has filed a criminal complaint against drugmaker Merck, accusing it of rigging prices for its branded drugs, as well as conspiring to manipulate the price of generic versions of its drugs.
The companies behind Merck’s branded drugs are also being targeted.
“This investigation is focused on the manipulation of the wholesale market for pharmaceuticals, including Merck products,” the DOJ said in a statement on Monday.
“The antitrust investigation is also investigating the alleged conspiracy between Merck and certain foreign companies, including the Chinese government, to increase the price and scope of their supply-chain transactions.”
“The investigation also includes allegations that Merck was involved in the illegal conduct of other foreign firms,” the statement added.
The investigation into Merck will look into the allegations against its China-based drugmakers, including its largest US rival, Pfizer.
The Justice Department is investigating Merck over the conduct of its Chinese drugmakers.
Merck is also accused of conspiring with Pfizer and other foreign drugmakers to rig the prices of its branded and generic versions, as it seeks to increase its market share.
This is not the first time the Justice Department has accused the Chinese pharmaceutical giant of manipulating prices.
In March, US District Judge Richard Leon, in a case brought by the Drug Enforcement Administration, ruled that the Chinese drugmaker should be held accountable for what the Justice department calls its “predatory pricing”.
“These Chinese companies are not merely engaged in predatory pricing; they are engaged in the most serious form of pricing manipulation that has ever been documented,” Leon wrote.
During his 2016 sentencing, Leon said that “there is no way to assess the likelihood of a market for drugs at this level without a more comprehensive view of what the US government is doing with respect to the Chinese market.”
In a statement, Merck said it would comply with the investigations and “stand by its products, its suppliers, and its employees.”
The company also defended the way it operates.
“Merck has the utmost respect for the law and the integrity of our supply chain,” Merck spokesperson Emily Miller said.
“We have an open, transparent, and competitive supply chain, and we do everything possible to protect it.
We do not have any evidence that our suppliers or employees have engaged in illegal activity.”
Pfizer declined to comment.
PepsiCo did not immediately respond to a request for comment.
The US investigation into the Chinese companies is the first such probe into the US pharmaceutical industry in a decade.
Earlier this year, the US Justice Department indicted two other Chinese drug makers, Sun Pharma and China National Chemical, for allegedly conspiring to “unfairly manipulate” the price, in part, by “creating a monopoly on generic drugs in the US market” in a bid to drive up the price.
Both companies pleaded not guilty to the charges.
In May, Merks drugmaker was hit with another criminal probe, with the Securities and Public Market Oversight Commission announcing that the company had violated the US Sherman Act by conspiring to rig prices for prescription drugs.
But Merck has been hit with multiple separate probes in recent years.
A separate investigation into Chinese drug giant Anbang Insurance in 2014 resulted in a $1.4 billion fine.
And in 2016, the FDA found that China’s pharmaceutical giant Tianjin Pharmaceuticals, which is owned by the state-run China Medical Holdings, “engaged in systematic and widespread violations of the Sherman Act in its bid to maintain a monopoly over the generic and branded medicines market”.
A third investigation into a Chinese pharmaceutical company led by US authorities in 2015 resulted in fines totaling $2.5 billion for manipulating drug prices.