A major pricing standoff is gripping the UK’s health sector. Health Secretary Wes Streeting is fiercely criticizing drug companies. He calls them “shortsighted” for rejecting a government pricing offer. Consequently, this dispute threatens patient access to new medicines. Moreover, it could impact the UK’s life sciences industry.
The conflict centers on a voluntary pricing scheme. Essentially, this scheme caps NHS spending on branded medicines. Then, companies repay revenues that exceed this cap. However, the scheme proved more expensive than anticipated. Therefore, the government proposed changes to lower costs.
Streeting offered a deal worth £1bn in savings. Unfortunately, the Association of the British Pharmaceutical Industry (ABPI) rejected it. The Health Secretary says he will not let “big pharma rip off” patients. Conversely, drug firms argue the UK’s rebate rates are far too high. They claim rates are triple those in other European countries.
This pricing standoff creates significant uncertainty. Industry leaders warn of moving jobs and trials abroad. For instance, AstraZeneca’s UK president called it a “race to the bottom.” Additionally, Novartis UK said justifying UK investment is now “very difficult.” Some firms may even withhold new drugs from the UK market.
Furthermore, a separate dispute exists over drug approvals. The National Institute for Clinical Excellence (Nice) uses a cost-effectiveness threshold. Drug companies argue this benchmark is now too low. Consequently, Gilead Sciences will not submit a new breast cancer drug for assessment.
Streeting defends the Nice process as robust and fair. He urges companies to offer effective medicines at reasonable prices. This intense pricing standoff shows no immediate signs of resolution. The outcome will critically affect NHS finances and future medical innovation.
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