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PPRS deal agreed

A deal over the Pharmaceutical Price Regulation Scheme (PPRS) has been agreed between the government and the pharmaceutical industry

A deal over the Pharmaceutical Price Regulation Scheme (PPRS) has been agreed between the government and the pharmaceutical industry.

The flexible pricing scheme will see the price of branded medicines cut, making them available to more patients on the NHS. Pharmaceutical companies will be given greater flexibility over the pricing of their drugs, enabling new drugs to be supplied to the NHS at a low price initially, and increased if their efficacy is proven.

Under the agreement the government intends to support and reward industry innovations, which will in turn benefit the patient who will receive faster access to National Institute for Health and Clinical Excellence (NICE)-approved medicines.

"A more flexible approach to pricing is in everyone's interest. It gets clinically and cost-effective drugs to more patients - providing cheaper options where clinically appropriate - delivers value for money for the NHS and the tax payer, and creates a better market for the pharmaceutical industry while supporting research and innovation," said Alan Johnson, Secretary of State for Health.

The key agreements include:
• A 3.9 per cent cut in the cost of drugs sold to the NHS, starting in February 2009
• A further cut of 1.9 per cent from January 2010
• Subject to further discussion, introduction of generic substitution from January 2010
• An innovation package ensuring patients have faster access to new medicines
• A non-contractual voluntary scheme covering pharmaceutical pricing over the next five years
• Flexible pricing arrangements enabling drug companies to change the price at which they supply medicines to the NHS based on its effectiveness
• Better use of patient access schemes by the industry to allow patients access to medicines that are yet to be assessed for clinical or cost-effectiveness.

Dr Richard Barker, director general of the Association of the British Pharmaceutical Industry (ABPI) said: "This landmark deal marks a turning point for patients, the NHS and the pharmaceutical industry. For the first time, the PPRS is much more than a simple economic agreement that looks at price alone.

"It is an all-encompassing package that encourages the discovery of new, more effective medicines, while at the same time allowing NHS patients to access these treatments more quickly."

The PPRS is a voluntary agreement between government and the pharmaceutical industry concerning the pricing of branded drugs in the UK. In August 2008, an interim scheme was launched to cover the period to 31 December, 2008. 

19th November 2008

From: Healthcare

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