AIM-listed Alliance Pharma suffered a setback when competition authorities sought to ban its boss following a drug pricing scandal.
Peter Butterfield, who has run the company since 2018, is facing a competitive disqualification order (CDO) from the Competition and Markets Authority (CMA) after Alliance and three other health groups were fined $35 on charges of conspiring to restrict supply of prochlorperazine Millions of pounds have been spent on a medicine used to treat nausea, dizziness and migraines.
The agreement is said to have caused the price paid by the NHS for the drug to skyrocket from £6.49 for a pack of 50 tablets to £51.68 between 2013 and 2017 – a rise of 700 per cent.
Scandal: Alliance and three other health groups have been fined £35million as they are accused of conspiring to restrict supplies of prochlorperazine
Alliance said it was “very disappointed” by the CMA’s decision to disqualify Butterfield and “disagreed in principle” with the regulator’s decision to fine the firm it is appealing.
“Alliance reiterates that it has not participated in or benefited from any market-sharing arrangement and refutes any involvement by the Company or Mr. Butterfield, who has the full confidence and support of the Board of Directors,” she added.
Shares of the company fell 13.37 per cent, or 12.5p, to 81p after the news.
In addition to Butterfield, the CMA is also seeking CDOs against several other individuals linked to companies implicated in the scandal, including John Dawson, director of Alliance Pharma, and executives from Lexon UK, Focus Pharmaceuticals and Medreich.
A total of seven directors of the company are disqualified as a result of the incident. The FTSE 100 was up 1.86 percent, or 132.69 points, to 7281.19, while the FTSE 250 was up 1.94 percent, or 359.48 points, to 18853.22. A weekend rally helped erase some of the losses in the market following Thursday’s declines, led by rallies in stocks initially caught in the sell-off.
Among them was investment firm Abrdn, up 7.45 percent, or 10.55 pence, to 152.1 pence, while Rolls-Royce was up 5.27 percent, or 3.76 pence, to 75.07 pence and miner Fresnillo was up 5 .5 percent or 36.2 pence up 693.8p.
Oil stocks received a boost as crude prices rallied amid predictions that the OPEC+ cartel will decide to cut production at a meeting next week.
Brent crude traded near $95 a barrel, taking BP shares up 2.83 percent or 12.5 pence to 453.70 pence, while Shell amid reports of the impending departure of its boss Ben van Beurden rose by 2.24 per cent or 51 pence to 2324 pence. The rise in oil prices boosted other energy stocks, with Harbor Energy, the North Sea’s largest producer, rising 0.81 percent, or 3.8 pence, to 473 pence.
But the blue chip index’s rally was tempered by homebuilders falling after analysts at HSBC struck a dovish tone on the sector and downgraded companies across the board. The investment bank forecast that demand for housing could fall by 20 per cent in the coming year, causing property prices to fall by 7.5 per cent, with central London seeing twice the drop.
Analysts downgraded Barratt (down 1.23 percent or 5.1 pence to 410.1 pence) and Persimmon (down 1.90 percent or 28 pence to 1442 pence) to hold from buy, while Berkeley (down 2 .7 percent or 97 pence) to 3492p) was knocked from hold to reduce.
Other firms have had better luck among brokers, with British Gas owner Centrica adding 2.43 per cent, or 1.86p, to 78.38p after analysts at RBC lowered their price target on the stock from 125p to 140p had raised.
Meanwhile, e-commerce group Zamaz made its debut in the London market, becoming only the second company to be listed on the LSE through a direct listing, a process whereby a company sells shares directly to the public rather than as with Intermediaries an initial public offering (IPO).
The stock ended its first session priced at 9.48 pence.
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