Drug firm fined £10m for breaking law over heartburn medicine

The Office of Fair Trading (OFT) hit the group with the penalty after Reckitt admitted anti-competitive behaviour in supplying heartburn treatment to the health service – a market costing the NHS 15m to 20 m a year.

The competition watchdog, which first made the claims in February, said Reckitt sought to restrict competition to its Gaviscon treatment by offering family doctors only a more expensive version of the product when they searched prescribing software.

Reckitt admitted infringing UK and European competition law. The OFT said the firm's admission and early co-operation saw the fine reduced from a potential 12m.

Doctors use software to search for well-branded products and then provide patients with an "open" prescription that lists generic names too.

Pharmacies can then choose whether to dispense the brand or a cheaper rival, at considerable cost savings to the NHS.

The OFT said Reckitt deliberately took a sister product off the list in 2005 just before cheaper generic rivals were added.

This timing meant that an NHS doctor searching for "Gaviscon" would instead bring up its "Gaviscon Advance Liquid" – a patent-protected version which did not have the "open" prescription that would have allowed generic rivals to be shown to GPs, according to the OFT.

OFT chief executive John Fingleton said: "Vigorous competition between firms supplying the public sector is vital to ensure taxpayers get the best value for money.

"This case underlines our determination to prevent companies with a dominant position in a market from using their strength to seek to restrict competition from rivals.

"The imposition of penalties should serve to deter firms from engaging in anti-competitive behaviour of this sort in future."

Reckitt said: "This OFT investigation relates to an infringement that took place a number of years ago under a highly complex area of competition law, on which there have only more recently been clarifying cases."