Fears US drug pricing deal will weigh heavy on the NHS
Minister of State for Science, Research and Innovation Sir Patrick Vallance.
UK Science Minister, Sir Patrick Vallance, has confirmed that the cost of the drug pricing deal with the US – initially around £1 billion over three years – will come out of the Department of Health and Social Care budget.
In a letter to the Commons Science, Innovation and Technology Committee (SITC), Vallance ended speculation that the Treasury would fund the increase, raising fears among campaigners that the additional costs would eventually be borne by an already cash-strapped NHS.
Campaign group Global Justice Now has told The Guardian it fears costs will spiral after the current 10-year agreement comes to an end, with some claiming it could end up costing the country up to £9 billion a year by 2035. One recent analysis published in The Lancet put the figure at around £3 billion a year, suggesting that simply diverting that sum from other NHS spending could cost thousands of lives each year.
The total annual budget for NHS England is currently £196 billion, out of a total DHSC budget of £202 billion, so there are concerns that a big increase in medicine spending could have an impact on frontline services.
The pharma pricing deal agreed towards the end of last year means that the tariff rate on medicines imported into the US from the UK will remain at 0%, but, as a quid pro quo, the UK pledged to raise its spending on new medicines by 25%.
That increase will be achieved in part by raising the baseline cost-effectiveness threshold for drugs to be recommended for NHS commissioning, and Vallance also confirmed that the voluntary scheme of clawback payments on NHS spending on new medicines "will be amended such that it does not recoup these additional costs" to ensure the price increases are preserved.
"The government has claimed that the deal will only cost around £1 billion per year, but the UK's new commitment to double the amount the NHS spends on medicines to 0.6% of GDP suggests a much larger increase is eventually likely," said Global Justice Now shortly after the deal was announced.
The Trump administration claims the agreement will lead to continued investment by UK pharma companies in the US, creating jobs for American workers, while the UK government maintains it will secure and expand access to medicines for "tens of thousands" of NHS patients and protect UK-based manufacturing and jobs.
Commenting on Vallance's letter, Dame Chi Onwurah, Labour MP for Newcastle upon Tyne Central and West and chair of the SITC, said: "This deal carries a significant cost, and it's up to the government to ensure…that it delivers significant return."
She added: "It's crucial that the benefits to UK patients outweigh the projected financial cost, particularly given the huge existing demands on the NHS. As the deal progresses, domestic health and life sciences policy must remain the priority – not the interests of US pharmaceutical companies."
