Police and the Serious Fraud Office yesterday raided six drugs companies and dozens of homes as part of investigations into alleged overcharging and possible price-fixing.

Unofficial estimates say the fraud could have cost the NHS up to £400 million.

Gerald Malone, a former Conservative health minister, and Labour peer Baroness Falkender are both directors of one of the companies targeted by the authorities.

As the government's anti-cartel Enterprise Bill had its second reading in the Commons yesterday, the Office of Fair Trading said it was now uncovering cartels at the rate of one a month.