Pharma industry to help fund NHS’s 2016 medicines bill

The pharma industry is to give £200 million to the NHS in early rebate payments to help it pay for medicines.

The move is unprecedented for the UK pharma industry, and is a clear sign of the huge financial pressure the NHS is under, as its budgets are failing to keep up with rising demand for care and drugs.

The deal, announced yesterday, will see the industry pay around £550 million in 2016 in rebates to help pay for medicines for NHS patients, as part of its Pharmaceutical Price Regulation Scheme (PPRS) with the government.

The new agreement means payments that would have been made in 2017 and 2018 will be brought forward to 2016. This will help the government deliver its NHS funding commitment to NHS chief executive Simon Stevens’ ambitious reform programme, the Five Year Forward View.

The latest figures from the PPRS deal show the industry is providing a £202 million rebate to the Department of Health under the PPRS for the third quarter of the year, bringing 2015’s total contribution to £619 million. The industry has paid around £1 billion back to government since the inception of PPRS in 2014 and over the five years of the agreement it expects to pay a total of £3 billion.

Acting CEO at the ABPI, Alison Clough said the agreement to bring the payments forward showed the industry’s commitment to patients, “so they get the medicines they need and also improving the flow of new and innovative medicines into the NHS.”

She added: “We know that access to new medicines is patchy across the UK and that there are still barriers in the system.”

Clough stressed the uniqueness of the PPRS deal, and said the UK has some of the lowest costs for medicines in Europe. The ABPI hopes that the trade-off from the deal will be faster uptake of new medicines.

2016 will see numerous strategic changes to how drugs are reviewed and taken up by the NHS. The ABPI is calling for faster uptake of new medicines which demonstrate high clinical and cost-effectiveness and which have been recommended for use by the National Institute for Health and Care Excellence (NICE). Central to its hope for reforms is the Accelerated Access Review, due to be published in April – but with limited funds to play with, the industry will hope that streamlined systems will be enough to improve UK market access.

Yesterday’s deal with pharma mirrors a similar ‘frontloading’ of funding secured by Stevens from Chancellor George Osborne in his recent mini-budget, in which the NHS received £3.8 billion in 2016/17 rather than in subsequent years.

However many NHS experts say the health service in England is still heading towards huge financial problems – it must make efficiency savings of £22 billion before 2020, but a majority of hospital trusts are now in deficit, and fears of deteriorating patient services are mounting.

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