[Ip-health] UK:NHS drug costs to be renegotiated

[Michelle Childs]

--
[ Picked text/plain from multipart/alternative ]
http://news.bbc.co.uk/1/hi/health/6927814.stm
NHS drug costs to be renegotiated

Health Secretary Alan Johnson is to renegotiate a five-year agreement
with pharmaceutical companies on the price of drugs to the NHS.

The Office of Fair Trading recently condemned the Pharmaceutical
Price Regulation Scheme which allows drug companies to set their own
prices.

It said the NHS was paying drug firms hundreds of millions of pounds
too much for branded drugs.

The Department of Health said the system needed updating for efficiency.

Value for money

The OFT suggested a move to pricing drugs based on health impact
rather than the cost to manufacturers could save =A3500m from the NHS'
current drugs bill which stands at more than =A38 billion a year.

The announcement comes as the government publishes its interim
response to the OFT report.

A Department of Health spokesman said: "The OFT concluded that the
pricing system should have a more value-based approach in order to
deliver greater benefit to patients.

"It said reform could deliver better value for money for the NHS. The
Secretary of State has therefore decided that it is timely to enter
into a dialogue with the industry to renegotiate the PPRS."

He said any new agreement would recognise the contribution of the
pharmaceutical industry to the UK economy.

"It is in all our interests to encourage research and reward
innovation, but above all we want to ensure that the taxpayer gets
value for money and patients continue to benefit from innovative
products at a reasonable price."

The Association of the British Pharmaceutical Industry said that the
PPRS had done a "good job" of delivering value for money in
healthcare, but welcomed a review.

Nigel Brooksby, president of the ABPI, said: "The PPRS has brought
many benefits to the NHS and to the UK as a whole. It is essential
that these remain integral to the PPRS as it evolves."

He said the pharmaceutical industry recognised the government's need
to gain best value for money from all aspects of NHS services,
including medicines.

Liberal Democrat health spokesman John Pugh said: "The relationship
between the pharmaceutical industry and the British government has
been far too cosy for too long. This renegotiation is a very welcome
development."


---------
Michelle Childs
Head of European Affairs
Knowledge Ecology International
michelle.childs@keionline.org