NHS Finance

28.11.18

New voluntary drug pricing deal could cut NHS medicine bill by almost £1bn

A new voluntary scheme to control the pricing of branded medicines could provide patients with earlier access to new medicines and save the NHS almost a £1bn on its annual medicine bill.

It will introduce an annual 2% cap on the growth of branded medicine sales to the health service with companies repaying the NHS for spending above this limit, and is expected to deliver savings of around £930m.

The ‘Voluntary Scheme for Branded Medicines Pricing and Access’ was agreed by the government, NHS England and the Association of the British Pharmaceutical Industry (ABPI) and is expected to come into effect in January 2019.

The old Pharmaceutical Price Regulation Scheme (PPRS) agreed between the government and industry is due to expire on 31 December this year, leading to negotiations between the three sides to agree new terms.

Developed in partnership with the pharmaceutical industry, the five-year scheme is designed to support innovation and manage spending on medicines.

The details of the deal are still being finalised, but will include an NHS commitment to improve the uptake and use of medicines across five key disease areas.

Matt Hancock said the scheme will be “good for patients will be good for patients, good for the NHS and good for the UK life sciences industry.”

He added: “Cutting-edge and best value medicines will be fast-tracked and we will cut our medicines bill by £930m next year following tough but constructive negotiations with the pharmaceutical industry – money we can redeploy into better NHS services, alongside the NHS long-term plan.”

The health secretary argued that the deal will also ensure the UK “remains an attractive hub for research and investment so the next generation of ground-breaking treatments can be developed here with patients benefitting earlier.”

The ABPI said in a statement that a “major milestone” had been reached, and that it would provide a “more flexible and streamlined commercial process” which would make the UK more attractive to investors.

Companies that choose not to join the voluntary pricing scheme will instead be enrolled in the statutory scheme, which operates alongside the voluntary one to control the cost of branded NHS medicines.

Health minister Lord O’Shaughnessy called the deal a “vote of confidence for our world-leading life sciences sector” and claimed it would be particularly helpful for small and medium-sized businesses by allowing greater commercial flexibility.

Image credit - Julien Behal/PA Wire/PA Images

Comments

There are no comments. Why not be the first?

Add your comment

 

national health executive tv

more videos >

latest healthcare news

Two NHS trusts spent a third of the year on highest ‘Opel 4’ pressure alert

12/12/2018Two NHS trusts spent a third of the year on highest ‘Opel 4’ pressure alert

Two NHS trusts spent more than a third of the year under extreme pressure and on the highest level of alert. An investigation by the BBC fou... more >
Financially struggling NHS trust appoints fifth chief executive in just five years

12/12/2018Financially struggling NHS trust appoints fifth chief executive in just five years

The financially troubled West Hertfordshire Hospitals NHS Trust has appointed Christen Allen as its newest chief executive – marking its fi... more >
Quarter of trusts spent no money on cyber security last year as NHS’s ‘alarming’ cyber training inconsistencies revealed

12/12/2018Quarter of trusts spent no money on cyber security last year as NHS’s ‘alarming’ cyber training inconsistencies revealed

One in four NHS trusts in England and Wales are spending no money on specialist cyber security or training and trusts are consistently failing to... more >

editor's comment

25/09/2017A hotbed of innovation

This edition of NHE comes hot on the heels of this year’s NHS Expo which, once again, proved to be a huge success at Manchester Central. A number of announcements were made during the event, with the health secretary naming the second wave of NHS digital pioneers, or ‘fast followers’, which follow the initial global digital exemplars who were revealed at the same show 12 months earlier.  Jeremy Hunt also stated th... read more >

last word

Hard to be optimistic

Hard to be optimistic

Rachel Power, chief executive of the Patients Association, warns that we must be realistic about the very real effects of continued underfunding across the health service. It’s now bey... more > more last word articles >

the scalpel's daily blog

The robots are here at East Suffolk and North Essex

12/12/2018The robots are here at East Suffolk and North Essex

Lauren Hockney, senior communications officer at East Suffolk and North Essex NHS FT (ESNEFT), outlines how her trust is embracing the digital and automation revolution. Robots have arrived at the ESNEFT, and they are giving back hundreds of hours to staff so they can spend more time helping patients. The trust, which includes Colche... more >
read more blog posts from 'the scalpel' >

comment

Creating a volunteer 'passport'

12/12/2018Creating a volunteer 'passport'

By utilising the health service’s volunteers, we can deliver better care for everyone, argues Kay Fawcett OBE, clinical project lead at Hel... more >
Right people, right place, right now

12/12/2018Right people, right place, right now

Sean Duggan, chief executive of the Mental Health Network, raises concerns around the mental health workforce and shares some best practice from ... more >
Breaking down barriers to integration

12/12/2018Breaking down barriers to integration

Anne Marie Morris, member of the Public Accounts Committee (PAC) and MP for Newton Abbott, outlines the committee’s recent report on the ba... more >
An attack on them is an attack on us all

12/12/2018An attack on them is an attack on us all

Chris Bryant MP discusses the new law he championed that came into effect in September, which doubles jail time for anyone who assaults emergency... more >

interviews

How can winter pressures be dealt with? Introduce a National Social Care Service, RCP president suggests

24/10/2018How can winter pressures be dealt with? Introduce a National Social Care Service, RCP president suggests

A dedicated national social care service could be a potential solution to surging demand burdening acute health providers over the winter months,... more >
RCP president on new Liverpool college building: ‘This will be a hub for clinicians in the north’

24/10/2018RCP president on new Liverpool college building: ‘This will be a hub for clinicians in the north’

The president of the Royal College of Physicians (RCP) has told NHE that the college’s new headquarters based in Liverpool will become a hu... more >
Duncan Selbie: A step on the journey to population health

24/01/2018Duncan Selbie: A step on the journey to population health

The NHS plays a part in the country’s wellness – but it’s far from being all that matters. Duncan Selbie, chief executive of Pu... more >
Cutting through the fake news

22/11/2017Cutting through the fake news

In an era of so-called ‘fake news’ growing alongside a renewed focus on reducing stigma around mental health, Paul Farmer, chief exec... more >

health service focus

View all News