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ABPI sets out proposals for UK government to support the NHS and economy

The association is suggesting a fixed rebate rate of 6.88% on all eligible UK drug sales

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The Association of the British Pharmaceutical Industry (ABPI) has published a new set of proposals for the UK government aimed at supporting both the NHS and economy.

Included in the proposals are calls for a new voluntary scheme for pricing, access and growth (VPAG) to ‘deliver a sustainable approach to medicines provision while also maximising the potential of the UK life sciences industry as an engine for growth’.

The current VPAG, introduced in 2019, caps the growth of NHS branded medicine spending at a nominal rate of 2% per year, with the industry returning any spending beyond the cap in the form of a levy.

However, companies are increasingly arguing that it is no longer possible to justify the voluntary scheme to global boardrooms and investors.

In December last year, the government announced that those within the voluntary scheme would be required to return almost £3.3bn in sales revenue – 26.5% of sales – up from around £0.6bn in 2021 and £1.8bn in 2022.

ABPI has previously warned that if the UK is unable to address rapidly escalating rates in future years and return repayment rates to ‘historical norms’, it will increasingly see investment, jobs and research partnerships moving to other, more supportive markets.

The association is now proposing a fixed rebate rate of 6.88% on all eligible NHS medicine sales to be paid by the industry, claiming the levy would give the health service more than £1bn a year – around £300m more than the average delivered under the old scheme before 2023.

The industry also proposes that as part of such a package, it could agree to an industry-funded investment facility worth over £1bn over five years, to ‘maximise the potential of the UK health and life sciences ecosystem’.

This would be provided by a 1.5% premium on NHS sales paid by scheme members in addition to the scheme payment rate, ABPI said, and used to support shared priorities such as boosting NHS clinical trial capacity and delivery.

Richard Torbett, ABPI’s chief executive, said: “The life sciences industry in the UK stands at a crossroads. The current direction of travel is leading away from success and we must act urgently to turn this around.

“Working together, we can create the conditions for innovative medicines to deliver their true value as an investment in the nation’s future health, wealth and productivity.”

Article by
Emily Kimber

2nd March 2023

From: Regulatory, Healthcare



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