Changes to UK’s VPAG: Non-submissions should be a key metric of impact
Leela Barham argues that, whatever people think of the changes to the UK’s pricing deal, VPAG, judging the difference they make should include monitoring non-submissions to HTA agency NICE, given the focus on increasing access to new medicines for patients.
US-UK trade deal
Changes to the UK’s pricing scheme, VPAG, are due to come into effect as a result of a UK-US trade deal that was announced in December 2025.
For the UK, it means the US won’t impose tariffs on UK pharmaceutical exports for three years.
For the US, it means that the UK will spend more on medicines and offer more support to industry. Over the next ten years, branded drug spending should increase from around 0.3% of GDP to 0.6% of GDP, adding around £1 billion to expenditure from 2026 to 2028, according to the industry association, the ABPI.
Increase in cost-effectiveness threshold
Delivery of higher branded drug spending by the UK is planned via two changes: a higher cost-effectiveness threshold and a new value set for judging health states. The threshold will go up from the standard range of £20,000 to £30,000 per QALY to £25,000 to £35,000 per QALY. The change will apply from April 2026, according to NICE.
Raising the threshold should mean that NICE can recommended more expensive treatments, as put by a December 2025 House of Commons briefing on how medicines prices are set in the UK. NICE thinks that they are likely to recommend an additional three to five new medicines or indications per year.
The rebate rate under VPAG has also come down versus rates seen in the past, to 14.5% rebate on National Health Service (NHS) sales of new branded medicines in 2026. That compares to 22.9% in 2025 (rebates vary from 10% to 35% for older medicines). That means that a 15% cap on the rebate rate agreed under the US-UK trade deal hasn’t bitten, at least for now. VPAG is due to run until the end of 2028, so rebate rates will be calculated for 2027 and 2028 in the future.
Judging impact
The UK government’s press release for the trade deal states that the “milestone deal secures UK’s medicines access and supply for tens of thousands of patients, with a wide range of groundbreaking new treatments to reach NHS front-line quicker.”
Access is listed before economic growth, with investment and jobs signalled as the payoff for the UK economy.
The government press release also cites three areas that will be measured when it comes to the commitment to make the UK one of the top three fastest places in Europe for patient access to medicines by 2030, including:
- The speed with which products are licensed and/or registered on the UK market in comparison to other European markets
- The timeline and cost to achieving appropriate Health Technology Assessment in England
- The uptake and widespread adoption of products in the National Health Service in England
Non-submissions
Access for patients in England is not impossible with a NICE approval, but it is harder, because there is no requirement for the NHS to routinely fund treatment and it typically rests on funding requests made by clinicians for specific patients. Non-submissions to NICE happen when companies are invited, but choose not to participate in NICE technology appraisals, typically Single Technology Appraisals (STA), or the highly specialised technology process (HST).
NICE has pointed out that terminations have accounted for around 20% of NICE’s recommendations since 2019/20. Terminations are a procedural step to formally close off appraisals when companies choose not to submit. Patient groups working together in the Blood Cancer Alliance have raised concerns about non-submissions.
Non-submissions are part of routine reporting on VPAG (albeit not always published in a timely fashion), but NICE and the ABPI looked more closely at non-submissions according to an appendix to a September 2025 board report from NICE. It’s also an issue that has been tabled in parliament as recently as October 2025, with Baroness Ritchie of Downpatrick asking the government about obstacles that have prevented medicines from being launched over the last five years, including terminated appraisals. The government response referenced a NICE Board paper from September 2025.
The NICE Board report set out how NICE and the ABPI ran an interview-based review, talking to ten companies about their reasons for terminating appraisals.
NICE reported that, “companies primarily choose to terminate appraisals because they considered the product/indication would likely not be found clinically and cost-effective by NICE.” This was the case, according to NICE, for 32 indications that they looked at or 70% of the indications they considered (this implies that they looked at 46 indications).
The second most commonly stated reason was for commercial reasons (14, 30% of indications).
So, it follows that a higher threshold should mean more companies will engage in the NICE process.
Representative?
What’s missing from the NICE reporting on their deeper dive on non-submissions is the finer details of their research. A freedom of information request asked NICE to provide more details. Their response revealed that the institute, alongside colleagues from the ABPI, interviewed nine pharmaceutical companies during November 2024 (so, at the time, the VPAG rebate rate for newer medicines was 22.9%).
Eleven companies were invited to participate. The eleven companies had seen the highest terminations between January 2019 and June 2024. Over that time period, there were 93 indications with terminated appraisals (which doesn’t align with NICE referring to 101 indications in their slide deck).
The NICE slide deck refers to ten companies, but it was really nine pharmaceutical companies, because the ABPI also spoke to a market access consultancy to “gather an additional perspective on terminated appraisals,” according to the FOI response. The NICE slide deck doesn’t make this distinction, referring to their “interview-based review of reasons stated by industry for terminating appraisals with 10 companies which had the highest number of terminated appraisals in recent years.”
The names of the 10 companies were not revealed in the freedom of information response because NICE’s then chief executive, Dr Sam Roberts, “reached the view that releasing this information would be likely to inhibit the free and frank provision of advice and the free and frank exchange of views for the purposes of deliberation, and would therefore likely to prejudice the effective conduct of public affairs.”
It is possible to backtrack to identify which companies have not submitted to NICE over the time period looked at, so, if anyone wanted to, they could identify who is likely to have taken part, although it wouldn’t be definitive.
The nine pharmaceutical companies accounted for 46 (49%) of the 93 terminations. The implication? The research wasn’t comprehensive, and maybe it didn’t need to be, but the takeaway is that the NICE research, suspected to be the most recent to explore company perspectives, may not be representative. There may be other good reasons companies don’t engage, other than the concern of hitting NICE’s cost-effectiveness threshold. Making it easier for companies or enabling them to be more confident that their products are more likely to be found cost-effective, therefore, might not ‘solve’ non-submissions.
Other ways to look at access
Raising the cost-effectiveness threshold might mean more companies choose to submit to NICE; it might also mean more of those who would have anyway are likely to get a NICE ‘yes’. Yet, that’s not enough on its own to mean patients have access. So, other measures of access should be looked at, too, just as signalled by the UK government.
The detail is missing from the UK government press release, but presumably the Innovation Scorecard is on the list. The Innovation Scorecard monitors uptake of treatments that have been recommended by NICE as an interactive dashboard.
OpenPrescribing could also help explore uptake, too. It’s an open-access, interactive web platform from the University of Oxford that makes it much easier to look at prescribing data produced by the NHS.
Particularly relevant for NICE appraisals, which are often for treatments used in hospitals, is OpenPrescribing Hospitals. It was launched in a beta version in 2025. The first paper using OpenPrescribing Hospitals explored trends and variation in andexanet alfa for the reversal of direct oral anticoagulants in NHS Trusts. NICE’s TA697 from 2021 recommended andexanet alfa was used as an option for management of major gastrointestinal bleeding in patients taking apixaban or rivaroxaban. The analysis found that there was uptake, but that there was wide variation across NHS Trusts. The paper suggests the analysis is “expected to provide a generalisable framework for similar analyses in the future.”
Open access to hospital prescribing data offers the opportunity to those who are interested, if they have the time and skills, to explore access in the secondary care setting and use that research to hold the government and others to account.
Invisible impact
Improving access might be seen as a positive change driven by the changes to the threshold and VPAG by some. Others might put it differently; there will be an opportunity cost that may be far less visible from the change, as more health is given up elsewhere in the system. Health economists Karl Claxton and Mark Sculpher, both Professors at the University of York, have estimated that higher spending of £1 billion on drugs to be over 4,500 deaths and a loss of close to 120,000 years of life in good health each year.
Whether the changes to VPAG prove to be worth it will need much more research and is likely to depend on who you ask.
