NHS drug charges row hits deadlock
Ministers have failed to agree a crucial deal on NHS drug charges that was meant to be at the centre of a plan to boost growth.
Talks on Friday between the Government and pharmaceutical industry bosses ended without an agreement on how much the NHS is able to claw back in rebates on drugs.
Ministers had been hoping to be able to address industry complaints of unfairness prior to the publication a strategy for the sector, expected next week.
One senior pharmaceutical executive said: 'If a [NHS clawback] deal is not secured, it's a missed opportunity for the life sciences sector plan and one which blocks the UK's ambition to be a life sciences superpower.'
Another said that the UK needed to show it wanted to make the scheme competitive again, adding: 'Without that, all the high statements of ambition or new strategies in the world are not going to make the UK a leading life sciences centre.'
The Department of Health launched a review of NHS rebates earlier this year under pressure from Donald Trump and the pharmaceutical industry.
Ministers said they would take into account the 'concerns of the US president' that countries are unfairly keeping prices low relative to the high drug costs in the American health system. Under the trade agreement signed between the two nations earlier this year, the Government agreed to 'endeavour to improve the overall environment for pharmaceutical companies operating in the UK'.
The failure to secure a deal ahead of the publication of the sector strategy follows months of wrangling.
Under the current rebate scheme, known as VPAG, pharmaceutical companies have to hand at least 23pc of their revenue from sales of branded medicines back to the NHS. The scheme cut the drug bill by £3bn last year.
However, pharmaceutical bosses have warned the scheme is preventing the launch of cutting-edge medicines in the UK. They have pressed for the UK to cut the rate of rebates into single digits, a level seen elsewhere in Europe.
The life sciences strategy is one of several sector plans announced as part of Labour's industrial strategy. Others were published this week.
A spokesman for the Government said: 'Economic growth is our number one priority and we're taking decisive action to unlock innovation and drive investment in the UK's world-class pharmaceutical sector. As part of this, we continue to work closely with industry on a rapid review of our voluntary scheme for medicines pricing.
'With our work and investment, we will make sure the next game changers in medicine are developed here in Britain, for the benefit of our health at home and abroad.'
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