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UK plans to cut some drug prices by up to 20 per cent

DH proposal relates to medicines not covered by PPRS

UK flagThe UK yesterday announced drug pricing plans that could bring down the cost of some medicines by up to 20 per cent as European countries continue to cut healthcare expenditure.

The Department of Health (DH) launched a consultation on revisions to the statutory scheme to control prices of branded medicine used on the NHS, which includes drugs not priced using the country's Pharmaceutical Price Regulation Scheme (PPRS) – a voluntary system to negotiate drug prices through industry/ government negotiation.

This statutory price control scheme was launched in 2008 to provide price controls for NHS medicines for companies who choose to opt out of PPRS.

Proposals in the consultation include a price adjustment on sales of branded drugs to the NHS of between 10 and 20 per cent while adding an exemption for smaller companies that have UK NHS sales of branded medicines of less than £5m.

“We want to make sure we get the best possible outcomes for all NHS patients with the resources we have,” said health minister Lord Howe in a statement announcing the consultation.

“We cannot simply spend more and more on drugs – this would mean spending less and less elsewhere.”

Anyone wanting to respond to the proposals has until July 31, 2013, when the consultation period closes.

The plans come at a time when the DH is looking to replace PPRS with a value-based pricing (VBP) system for new drugs from January 2014, and the DH expanded on these plans in its statement.

It has previously been confirmed that the National Institute for Health and Care Excellence (NICE) will be responsible for this new system, but the DH said it has now provided NICE with “a new blueprint to look at the benefits drugs bring to patients and wider society”, although details of what this blueprint contains were not stated publically.

Nevertheless, Sir Andrew Dillon, chief executive of NICE, said: “We welcome these new terms of reference from the Department of Health and look forward to engaging with our partners on how best to apply them in our evaluation of new drugs and other treatments.”

Lord Howe also expanded on the government's decision to switch from PPRS to a VBP system.

“A drug that brings a lot of extra benefits may justify the NHS paying more, but equally the NHS might pay less for a drug that does not deliver wider benefits,” he said.

“NICE is a world leader in the assessment of medicines and other treatments and will now work with patient groups, the NHS and the drugs industry to take this important work forward.”

21st June 2013

From: Sales

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