Closed consultation

Proposed update to the statutory scheme to control the cost of branded health service medicines

Published 18 March 2024

Executive summary

The Department of Health and Social Care (DHSC) proposes to amend the statutory scheme for branded medicines pricing. This consultation document seeks views on the proposals, particularly from the pharmaceutical industry and NHS patients.

The statutory scheme is set out in legislation in The Branded Health Service Medicines (Costs) Regulations 2018 (‘the regulations’ or ‘the statutory scheme’). It is one of 2 schemes, alongside the 2024 voluntary scheme for branded medicines pricing, access and growth (VPAG), that control the costs of branded medicines to the NHS. VPAG replaced the 2019 voluntary scheme for branded medicines pricing and access (VPAS), which expired at the end of 2023.

Following consultation in 2023, the following changes to the statutory scheme came into effect on 1 January 2024:

• payment percentages were set for 2024 to 2026 on the basis of an increased allowed growth rate of 2% (up from 1.1%)
• an exemption from payment for medicines containing a new active substance (NAS) for 36 months from the date of marketing authorisation (MA) was introduced, equivalent to the exemption in the voluntary scheme
• exemptions from payment for exceptional central procurements (ECPs) and centrally procured vaccines (CPVs) were introduced, reflecting equivalent exemptions in the voluntary scheme

As set out in the government consultation response published in December 2023, our policy remains to operate the statutory scheme in a way that is broadly commercially equivalent to the voluntary scheme, which was supported by respondents to the most recent consultation. However, given that significant elements of the final VPAG scheme differed from the statutory scheme proposals consulted on in 2023, broad commercial equivalence was not possible in full for 1 January 2024.

We are therefore proposing further amendments to the statutory scheme to maintain broad commercial equivalence with the 2024 VPAG. This consultation proposes to introduce a differentiated approach to setting payment percentages for newer medicines and older medicines:

1. The headline payment percentage for newer medicines will be set according to a target level of allowed sales, with allowed growth maintained at 2% per year, but a series of one-off adjustments will be made to the allowed sales baseline in 2024, 2025 and 2026. We therefore propose a headline payment percentage of 11.6% in Q3 to Q4 2024, 14.1% in 2025 and 16.5% in 2026.

2. Older medicines will pay a basic rate of 10.03% in Q3 to Q4 2024, 10.6% in 2025 and 11% in 2026, and a top-up rate of between 1% and 25%, if applicable, based on the level of observed price erosion from a reference price.

3. The threshold for an exemption from scheme payments for small companies will be uprated from companies with sales of less than £5 million to companies with sales of less than £6 million.

In proposing these updates, consideration is also being given to

• the Secretary of State’s public sector equality duty
• the family test
• the environmental principles policy statement
• duties under sections 1 to 1GA of the National Health Service Act 2006 (NHS Act)

This consideration is set out in the ‘statutory duties’ section, with additional information provided in the accompanying impact assessment.

Introduction

The statutory scheme is one of 2 schemes (alongside the new voluntary scheme, VPAG) that control the costs of branded medicines to the NHS. Any company that supplies eligible branded health service medicines is subject to the statutory scheme unless they opt to join the voluntary scheme.

A branded medicine is defined in the regulations. The definition refers to a medicine to which a brand name has been applied that enables the medicine to be identified without reference to the ‘common name’ (the generic or international non-proprietary name). As set out in the DHSC consultation response in December 2023, the schemes also apply to all biological medicines, regardless of whether they are marketed under a brand name or not.

Medicines represent the second highest proportion of NHS spend, worth £19.2 billion in England in the 2022 to 2023 financial year, £14 billion of which was on branded medicines. VPAG is the latest in a series of voluntary schemes to control NHS spend on branded medicines going back to 1957. It was agreed between DHSC, NHS England and the Association of the British Pharmaceutical Industry (ABPI) in December 2023, and came into force on 1 January 2024 for 5 years until 31 December 2028.

DHSC administers VPAG and the statutory scheme on behalf of all UK nations and the payments that companies make under the scheme in respect of the UK are allocated to each of the 4 countries on an agreed basis each year.

VPAG aims to promote better patient outcomes and a healthier population, support UK economic growth, and contribute to a financially sustainable NHS. VPAG introduces several novel elements compared to previous voluntary schemes, most notably a differentiated approach to setting payment percentages for newer medicines and older medicines.

The overarching policy objectives of the statutory scheme, as set out in a 2019 review of the regulations, are to:

• limit the growth in costs of branded health service medicines to safeguard the financial position of the NHS
• ensure medicines are available on reasonable terms, accounting for the costs of research and development
• deliver the above objectives in a way that is consistent with supporting both the life sciences sector and broader economy

The statutory scheme works by limiting the growth in allowed sales of branded medicines. Since an update from 1 January 2024, payment percentages have been set to keep net sales growth for sales of branded medicines subject to the scheme to an allowed growth rate of 2% (nominal) per year, up from an allowed growth rate of 1.1% previous to this. This update set the payment percentage for 2024 at 21.9%.

This consultation sets out proposed amendments in the following areas, with the aim of ensuring the statutory scheme is broadly commercially equivalent to the new VPAG, in particular by introducing a differentiated approach to setting payment percentages for newer medicines and older medicines:

1. The headline payment percentage for newer medicines will be set according to a target level of allowed sales, with allowed growth maintained at 2% per year, but a series of one-off adjustments will be made to the allowed sales baseline in 2024, 2025 and 2026. We therefore propose a headline payment percentage of 11.6% in Q3 to Q4 2024, 14.1% in 2025, and 16.5% in 2026.

2. Older medicines will pay a basic rate of 10.03% in Q3 and Q4 2024, 10.6% in 2025 and 11% in 2026, and a top-up rate of between 1 and 25%, if applicable, based on the level of observed price erosion from a reference price.

3. The threshold for an exemption from scheme payments for small companies will be uprated from companies with sales of less than £5 million to companies with sales of less than £6 million.

Additionally, the consultation sets out how the above changes will be implemented, including:

• the definitions of newer and older medicines
• how reference prices to determine top-up payment percentages for older medicines will be set
• data collection requirements, including for exemptions already present in the statutory scheme

Reason for proposed changes

VPAG and the statutory scheme work together to help to ensure value for money for the taxpayer on branded medicines expenditure and enable the NHS to continue investing in patients’ access to new medicines and non-pharmaceutical services, in a way that is consistent with supporting both the life sciences sector and broader economy. It is critical that the statutory scheme continues to achieve these aims and provide an alternative to VPAG.

To provide a viable alternative to VPAG, DHSC considers that the statutory scheme should have broad commercial equivalence with the voluntary scheme. Broad commercial equivalence means that government aims to set payment percentages in the statutory scheme that are comparable (but not necessarily identical) to those in the voluntary scheme. Responses to the consultation in autumn 2023 supported the policy of broad commercial equivalence between the voluntary and statutory schemes in the event a successor voluntary scheme to VPAS was agreed.

Now that VPAG has been agreed, further amendments to the statutory scheme are required to maintain broad commercial equivalence.

Allowed growth rate and baseline adjustments

The statutory scheme works by setting payment percentages intended to maintain growth in net sales of branded medicines (sales to the NHS of relevant branded medicines including parallel imports, net of payments made under the statutory scheme) to a target level against our forecast for branded medicine sales. There are 2 main parameters that determine the allowed sales:

• the ‘baseline’: the starting level of allowed sales in any given year
• the ‘allowed growth rate’: the rate at which allowed sales increases at the start of each year

As set out in the December 2023 consultation response, baseline sales for the statutory scheme in 2024 are 2023 statutory scheme allowed sales adjusted by the weighted average of allowed growth in the statutory scheme and VPAS since 2019 (1.1% and 2%, respectively) in line with their relative proportions of scheme memberships.

Baseline sales for VPAG are 2023 allowed sales in the VPAS adjusted upwards by £150 million in 2024, £150 million in 2025 and £330 million in 2026.

We propose to further adjust baseline sales in the statutory scheme in 2024, 2025 and 2026 to match the adjustments made in VPAG. This would ensure both schemes have a broadly equivalent starting point from which they control growth. By adjusting the baseline in this way, we partly reduce the extent to which payment percentages in the statutory scheme in 2024, 2025 and 2026 are set in relation to historic sales growth. This balances industry feedback that they are concerned about the extent to which controls on historic sales growth are inflating payment requirements with the government view that full re-baselining would undermine the ability of the scheme to protect NHS budgets and therefore act in the interests of patients.  

These adjustments to the baseline will see a reduction in payment percentages (and therefore revenues) compared to a counterfactual of making no adjustments. We believe this is justified on the basis that it reflects an appropriate balance between value for money for the NHS and providing a higher level of return for UK life sciences companies, and because the resultant payment percentages better reflect broad commercial equivalence between the schemes.

The government does not propose any changes to the allowed growth rate in the statutory scheme. The allowed growth rate was increased from 1 January 2024 from 1.1% to 2%. The government’s consultation response from December 2023 set out why we consider this to be an appropriate long-term growth rate for branded medicines, noting that increasing allowed growth beyond this (outside of the context of a time-bound negotiated voluntary agreement with mutual benefits for government and industry) could increase the risk of unsustainable growth in spending on branded medicines in the longer term.

While this will result in a different allowed growth rate in the statutory scheme and VPAG from 2025 onwards, the government believes that it is possible to nonetheless maintain broad commercial equivalence between the schemes, as was achieved between 2019 and 2023 when the statutory scheme and VPAS had different allowed growth rates.

Question

Do you agree or disagree that the statutory scheme should retain the allowed growth rate at 2% and implement baseline adjustments to allowed sales of £150 million in 2024, £150 million in 2025 and £330 million in 2026?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Introduction of differentiated approach to setting payment percentages for newer medicines and older medicines

We propose that the statutory scheme introduces a differentiated approach to setting payment percentages for newer medicines and older medicines to encourage innovation and competition, and to maintain broad commercial equivalence with VPAG.

As set out in the government’s consultation proposals of July 2023, the medicines market relies on the ‘innovation paradigm’, meaning that new medicines have higher prices at the start of their lifecycle, but lower ones towards the end of it.

New innovations are awarded intellectual property (IP) protection that enables them to command prices that are typically above the opportunity cost to the NHS. This means the NHS could produce more health gain if funds were allocated to alternative treatments instead of these new innovations. In return, older medicines are expected to face price competition from generics and biosimilars, resulting in prices falling towards the cost of supply, and below the opportunity cost to the NHS.

When this occurs, the NHS can improve health with the innovation at a cost lower than alternative uses of the funds. This enables the NHS to achieve value and improve net health gain overall (over the whole product lifecycle) notwithstanding the loss of health gain in the early periods, while supporting innovation with higher prices early in the lifecycle.

This system has been instrumental in enabling innovation in, and patient access to, medicines. However, in reality the model does not operate as described above to produce an efficient market all of the time. In particular, there is evidence that many older products are not facing competition sufficient to reduce prices and so are continuing to be sold at a high price even in the later stages of the product lifecycle.

Therefore, as indicated in our December 2023 consultation response, we propose that the statutory scheme should introduce a differentiated approach to setting payment percentages for newer medicines and older medicines. This is designed to support lower payment rates for newer medicines and for older medicines that have seen significant price reductions, subsidised by a top-up payment rate for older medicines that have not seen such price reductions. This is intended to support innovation and competition.

Question

Do you agree or disagree with the principle that the statutory scheme should have a differentiated approach to setting payment percentages for newer medicines and older medicines?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Q3 and Q4 2024

Due to consultation timelines, the earliest that the differentiated approach to setting payment percentages for newer medicines and older medicines in the statutory scheme could take effect is the beginning of Q3 2024. Until then, a fixed payment rate of 21.9% will continue to apply.

Unlike previous consultations on in-year amendments to the statutory scheme payment percentage, we do not propose to adjust payment rates upwards or downwards to meet an estimated full year (or 3 quarter year) target. Rather we propose to calculate the appropriate payment rates for the period of Q3 to Q4 2024 only.

Making such an adjustment would be operationally and commercially complex as setting adjusted older medicines’ top-up payment percentages would result in a non one-to-one relationship between changes in observed price decline and changes in the top-up payment percentage (with the higher top-up rates increasing significantly above 25% and the lower or basic rates falling below 10%), and so may create unintended commercial incentives. Moreover, such an approach would not be consistent with the approach taken in VPAG with respect to the transition period. Given these specific circumstances, this decision is not considered to create a precedent for future consultations.

Question

Do you agree or disagree that payment percentages for Q3 and Q4 of 2024 should be set such that they control growth in Q3 and Q4 only?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Definitions of older and newer medicines

We propose that whether a medicine is considered newer or older will be determined by the status of its active substance with respect to the definitions set out below. In all but exceptional circumstances, we judge whether a medicine is older or newer at the level of the virtual therapeutic moiety (VTM), which is an abstract representation of an active medicinal ingredient or substance without strength and form. The VTM will be taken from the dictionary of medicines and devices (dm+d).

The decision to determine newer and older status on the basis of the relevant active substance reflects both the approach taken in VPAG and our intention to support innovation in the development of new pharmaceutical substance. While we recognise that the innovation landscape is complex and multifaceted, and that not all innovation is at active substance level, we believe that that it is appropriate to recognise the difference in cost and risk between active substance development and other forms of pharmaceutical innovation, and we believe that other forms of pharmaceutical innovation can be adequately incentivised through other mechanisms.

We propose that only originator medicines and their licensees should be eligible for newer medicine status. Non-licensee new entrants (biosimilars and branded generics) operate in competitive markets and so should be treated as older medicines by default. They are also likely to be available at a discount on the originator, and so are less likely to be subject to a top-up payment.

We propose that a product will be a newer medicine where the supplementary protection certificate (SPC), if granted, remains in force for the active ingredient of any branded health service medicine of the same VTM as that product. This includes combination products where an SPC remains in force for the combination of active ingredients that makes up that VTM. An SPC is a form of IP that extends the protection of patented active ingredients present in pharmaceutical products. We have chosen to use SPCs as they typically apply to the active substance and provide for a straightforward-to-implement definition for which data is available to DHSC. Where an SPC was granted but has expired, lapsed or been surrendered then the product will be older from the date of expiry, lapse or surrender.

Where an SPC is neither in force nor has expired, lapsed or been surrendered, then we propose that a product will be a newer medicine for a period of 12 years from the date of the MA of the first licensed branded presentation of that active ingredient in any branded health service medicine of the same VTM as the product. Twelve years is chosen as it loosely reflects the average length of exclusivity or patent period, albeit this varies case by case. While we recognise that there will be some products whose IP has expired earlier than 12 years and others whose IP will expire later than 12 years, our intention is not to define an older product such that it perfectly reflects IP but rather such that it is a straightforward-to-implement proxy for the time in a product lifecycle where we would ordinarily expect to see average selling prices start to fall.

Further clarification is required with respect to the rules that apply to combination products where no SPC is in force, nor has it expired, lapsed or been surrendered. We propose that in such cases a product will be a newer medicine either:

• while there is an SPC in force for any active ingredient (or combination of active ingredients) within the combination product for any branded health service medicine of the VTM associated with that active ingredient (or combination of active ingredients)
• with respect to only those active ingredients within the combination to which no SPC is in force and no SPC has previously expired, lapsed or been surrendered, for a period of 12 years from the date of the MA of the first licensed branded presentation of the active ingredient (‘MA date’) within the combination with the most recent MA date for any branded health service medicine of the VTM associated with that active ingredient

Where the basis for a product being a newer medicine is due to the existence of an SPC in force, and that SPC is invalidated for any reason (such as if the basic patent is revoked), then we propose the effective date of the product becoming an older medicine shall be the date the product would, without an SPC, have otherwise become an older medicine. While different from the approach to SPC lapse or surrender (where the SPC is treated as if it has expired), it is consistent with the approach taken by the Intellectual Property Office who treat an invalidated SPC as if it was never in force.

We propose that older medicines are products which do not meet the definition of newer medicines. As noted, this includes all branded generics and biosimilars that are not licensees of the originator.

Question

Do you agree or disagree with the definitions for newer and older medicines?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Payment percentage for newer medicines

We propose that the payment percentage for newer medicines is set at the level such that, according to the sales forecast set out in the impact assessment, and considering the forecast for older medicines sales and older medicines income set out in the impact assessment, net sales of branded medicines would be controlled to the level of allowed sales in each year of the scheme as per the ‘Allowed growth rate and baseline adjustments’ section of this consultation document. The required total payment calculated in this way is down weighted to account for the proportion of total industry measured sales that are accounted for by companies in the statutory scheme. This is set out in more detail in the impact assessment.

The forecast used takes account of the latest industry sales data (for VPAS or VPAG, the statutory scheme, and parallel imports) up until the end of Q4 2023.

Using this methodology, we propose that the payment percentage for newer medicines will be set at:

• 11.6% in Q3 and Q4 of 2024
• 14.1% in 2025
• 16.5% in 2026 and subsequent years

We consider that these rates are broadly commercially equivalent to forecast VPAG headline payment percentages for the same period using the same data. This assessment takes account of a range of factors including but not limited to:

• the additional payment required from VPAG companies under the investment fund
• the difference in scheme exemptions in VPAG and the statutory scheme
• wider commercial commitments within VPAG
• our expectations about the stability of both schemes

We have not made explicit adjustments for such factors in setting the rates (for example, by increasing or decreasing calculated rates by the same amount as the relevant payment or exemption) as doing so would result in the scheme failing to control sales growth in line with the proposed allowed growth rate.

Question

Do you agree or disagree that the payment percentage for newer medicines should be set at 11.6% for Q3 and Q4 in 2024, 14.1% in 2025 and 16.5% in 2026?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Basic payment percentage for older medicines

We propose, as in VPAG, that all older medicines pay a basic payment percentage. The application of the basic payment percentage reflects that, even where competition is present, our evidence suggests that the levels of cost reduction for branded medicines remain lower than seen in generics markets. It is therefore appropriate to protect NHS budgets by applying a standard minimum payment across all older medicines.

We propose to set the basic payment percentage in the statutory scheme at 10.03% in 2024, 10.6% in 2025 and 11% in 2026. This represents the same level of payment as in VPAG, adjusted to reflect the VPAG investment programme payment, ensuring continued equivalence. We propose to make this adjustment as we believe it helps ensure the stability of both schemes. While this represents a slight difference in approach compared to newer medicines, where no such explicit adjustment is made, we believe this is appropriate given the wider difference in the approach to setting payment percentage across both categories where, unlike newer medicines, payment percentages for older medicines are fixed (at rates that align with those fixed in VPAG) rather than set according to a target rate of allowed growth.

For older medicines that are not additionally subject to a top-up payment percentage (that is, those that have demonstrated sufficient price decline or that qualify for a relevant exemption), such rates represent a significant reduction in the rebate compared to recent years (2022, 2023 and Q1 to Q2 2024). This responds to concerns articulated by manufacturers of branded generics and biosimilars that higher payment percentages could discourage competition. We consider that this level is appropriate, as it is within the range of rates that have been previously set within the statutory and voluntary schemes without causing issues for products operating in competitive markets.

Setting predictable payment percentages for older medicines has an additional benefit as it removes the requirement that companies include a future payment percentage risk premium when setting their prices on competitive multi-year tenders or framework agreements.

Question

Do you agree or disagree that the basic payment percentage for older medicines should be set at 10.03% in 2024, 10.6% in 2025 and 11% in 2026?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Top-up payment percentage for older medicines

We propose, as in VPAG, that certain older medicines, which have experienced a reduction in price on their relevant reference price of less than 35%, will additionally pay a top-up payment percentage. The top-up payment percentage which applies will be determined on a linear sliding scale up to a maximum of 25% based on the level of price reduction: the greater the price reduction, the lower the top-up payment percentage.

For example, a medicine that experienced a price decline of 34% against its relevant reference price would pay a top-up payment percentage of 1%, a medicine that experienced a price decline of 33% would pay a top-up payment percentage of 2%, and so on. The maximum top-up percentage of 25% will apply to older medicines with an observed price decline of 10% or less.

We consider that this level is appropriate as products that have seen smaller price declines are likely to be operating with greater profit margins and the NHS is likely to be continuing to pay a price that is above the opportunity cost for wider health spending. The government therefore considers that it is reasonable for these products to pay a higher payment percentage through the statutory scheme to recoup some of the value that the NHS would have expected to gain through price reductions under the innovation paradigm discussed above in ‘Introduction of differentiated approach to setting payment percentages for newer medicines and older medicines’.

These rates are chosen to represent an approximation of the expected price decline following competitive market entry. For example, where we have seen biosimilar entry, prices of high-spend biological medicines have been observed to fall by 20% to 50% up to 3 years following market entry.

We acknowledge there will be some cases of older products operating at higher prices but without significant margins. However, these cases are expected to be exceptional, and viability and supply of such products can be maintained through standard price increase processes as required.

To ensure these rules are applied fairly, we propose that where a scheme member is selling a new entrant older medicine that is neither an originator nor an originator licensee, the scheme member will be required to declare whether a commercial relationship exists between that product and the originator or originator licensee (for example, where the originator is the manufacturer of the stock marketed by the new entrant). Where a commercial relationship exists, the top-up payment percentage applied shall be no lower than that of the originator product.

Question

Do you agree or disagree that relevant sales of older medicines should pay a top-up payment percentage if they have demonstrated price decline of less than 35% compared to a reference price?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Calculating observed price decline

We propose to calculate observed price decline in the statutory scheme, and therefore the level of top-up payment due on an older medicine, with reference to:

• the observed average selling price: for 2024 the observed average selling price should be calculated across the last 2 quarters of 2024 only. In all other years the observed average selling price will be calculated across the whole scheme year, save for when a product moves between newer and older medicines status part way through a year, in which case the observed average selling price will be calculated across the relevant quarters where the product was an older medicine
• the price of the originator medicine (or medicines) containing the relevant active ingredient in the year prior to becoming an older medicine: this ‘reference price’ would then be the price against which price decline is measured and is intended to reflect the average selling price of the period where the originator medicine of that active ingredient had exclusivity

An observed price decline occurs where the observed average selling price is lower than the reference price. The observed price decline is calculated as one minus the observed average selling price divided by the reference price, rounded to the nearest whole percentage point.

Since the originator product will establish the market price for this product under exclusivity, we consider that the originator product (or products) should also set the reference price for subsequent branded generic or biosimilar competitors, and for any further versions of the originator (such as line extensions or new branded formulations) launched after the originator becomes an older medicine.

To ensure that the reference price of products is established in relation to the most similar products, where possible, we propose that the reference product is of the same VTM and was marketed in the same formulation, strength and pack size (known as the virtual medicinal product pack or ‘VMPP’). However, this will not be possible in all cases either because no such VMPP was marketed as a newer medicine or because of the lack of data availability for such a VMPP. In such circumstances, as set out below, we propose that the reference price will be set by DHSC on the basis of consideration of comparators of the same VTM among originator products, with the reference pricing being adjusted where appropriate to consider factors including but not limited to differences in pack sizes and strength.

The government considers that the most accurate reference price will be the average selling price of the VMPP prior to originator becoming an older medicine. However, for certain categories of medicines, it will not be possible to use average selling price information either because the relevant data is not available or because we are unable to share the relevant average selling price data with a company other than the originator company due to commercial confidentiality.

We therefore propose that the reference price of an older medicine is determined in accordance with 3 main categories:

• branded presentations which are originator or originator licensees that would have first met the definition of an older medicine on 1 January 2015 or later (‘older originator products at or after 2015’)
• branded presentations which are originator or originator licensees that would have first met the definition of an older medicine before 1 January 2015 or later (‘pre-2015 older originator products’)
• branded presentations which are not originator products (‘new entrant products’)

For any given branded presentation, the reference anchor date is 1 January the calendar year prior to the originator product meeting the definition of an older medicine. The reference price will normally be determined based on data from the full year starting at the reference anchor date (for average selling price data) or data from the reference anchor date (for list price data). However, where average selling price or list price data from this year is not available, DHSC may use data from the nearest appropriate alternative year. For average selling price data, the nearest appropriate alternative year will always be earlier than the reference anchor date. For list price data, the nearest appropriate alternative year will always be earlier than the reference anchor date where such data is available, but this will not be possible in all instances as available list price data does not go back further than 2003.

The reason for limiting the use of average selling prices to those medicines that became older medicines on or after 1 January 2015 is that DHSC does not hold data on average selling prices prior to 2014.

The reason for limiting the use of average selling prices to originator or originator licensee medicines is that we are limited in our ability to share commercially sensitive company information. As such, we propose that companies that are in the same corporate group as an originator or originator licensee may have their reference price established against an average selling price from that originator or originator licensee where available (following a version of the process set out in points 1 and 2 below), even if they are themselves not an originator or originator licensee, and so long as commercial confidentiality rules allow.

We propose that companies can request that the reference price of a product is adjusted where the price of the reference product was significantly reduced (in the reasonable opinion of DHSC) ahead of becoming an older medicine because of participation in a national level NHS England strategic category medicines tender. This will be at the discretion of DHSC.

The government notes there may be a small number of cases that cannot easily follow the rules below and where DHSC will need nonetheless need to set a reference price - for example, where no originator medicine of the same VTM can be identified. In such cases DHSC will identify comparators with the aim of establishing and setting reference prices based on the closest match or matches to the relevant branded presentation, having consideration to factors including but not limited to pack size, strength and mode of application.

Companies will have the opportunity to query reference pricing, but the final reference price will be at the discretion of DHSC.

Proposed process for establishing the reference price for branded presentations which are older originator products at or after 2015

1. Where the branded presentation was launched before or on the reference anchor date

The reference price will be the observed average selling price of the branded presentation in the full calendar year ahead of becoming an older medicine.

Where a reference price cannot be established on this basis, it will be established as per point 2.

2. Where the branded presentation was launched after the reference anchor date

The reference price will be set by DHSC on the basis of consideration of comparators of the same VTM by the same scheme member launched before the reference anchor date. The reference price will be informed by the observed average selling price of the most relevant comparator or comparators in the full calendar year ahead of the branded presentation becoming an older medicine, adjusted where appropriate to consider factors including but not limited to differences in pack size and strength.

Where a reference price cannot be established based on comparators from the same scheme member, the reference price will instead be informed by the list prices on the reference anchor date of comparators with the same VTM among originator products with a 12.5% downward adjustment, further adjusted where appropriate to consider factors including but not limited to differences in pack size and strength.

Proposed process for establishing the reference price for branded presentations which are pre-2015 older originator products

3. Where the branded presentation was launched before or on the reference anchor date

The reference price will be the list price of the branded presentation as of the reference anchor date with a 12.5% downward adjustment.

Where a reference price cannot be established on this basis, it will be established as per point 4.

4. Where the branded presentation was launched after the reference anchor date

The reference price will be set by DHSC on the basis of consideration of comparators of the same VTM by the same scheme member launched before the reference anchor date. The reference price will be informed by the list prices of the most relevant comparators as of the reference anchor date with a 12.5% downward adjustment, further adjusted where appropriate to consider factors including but not limited to differences in pack size and strength.

Where a reference price cannot be established based on comparators from the same scheme member, the reference price will instead be informed by the list prices as of the reference anchor date of the most relevant comparators of the same VTM among other originator products, and subject to the same adjustments.

Proposed process for establishing the reference price for branded presentation which are new entrant products

5. Where the branded presentation was launched before or on the reference anchor date, and at or before the reference anchor date there is one or more originator product with the same VMPP

The reference price will be based on the list price or prices of the originator product or products of the same VMPP on the reference anchor date, with a 12.5% downward adjustment.

Where a reference price cannot be established on this basis, it will be established as per point 7.

6. Where the branded presentation is launched before the reference anchor date, and at or before the time of launch there is one or more originator product with the same VMPP

The reference price will be based on the list price or prices of the originator product or products of the same VMPP on the date of launch, with a 12.5% downward adjustment.

This will be updated to the equivalent data as of the reference anchor date when available, subject to the same adjustments, and will be in effect for the first full scheme year following the reference anchor date.

Where a reference price cannot be established on this basis, it will be established as per point 8.

7. Where the branded presentation is launched on or after the reference anchor date, and as of the reference anchor date there is no originator product with the same VMPP

The reference price will be set by DHSC on the basis of consideration of comparators of the same VTM among originator products.

The reference price will be informed by the list prices of the most relevant comparators as of the reference anchor date with a 12.5% downward adjustment, further adjusted where appropriate to consider factors including but not limited to differences in pack size and strength.

8. Where the branded presentation is launched before the reference anchor date, and at the time of launch there is no originator product with the same VMPP

The reference price will be set by DHSC on the basis of consideration of comparators of the same VTM among originator products.

The reference price will be informed by the list prices of the most relevant comparators as of the launch date of the branded presentation with a 12.5% downward adjustment, further adjusted where appropriate to consider factors including but not limited to differences in pack size and strength.

This will be updated to the equivalent data as of the reference anchor date when available, subject to the same adjustments, and will be in effect for the first full scheme year following the reference anchor date.

Question

Do you agree or disagree with this approach to calculating observed price decline using reference prices?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Exemptions to the top-up payment percentage

We propose that the statutory scheme contains the same exemptions from the top-up payment percentage for older medicines as VPAG, covering:

• relevant plasma derived medicinal products (PDMPs)
• sales where a company sells less than £1.5 million of a given medicine each year

Blood and plasma derived products are a strategically important category that has consistently been subject to global supply constraints over an extended period of time. Applying only the basic payment percentage regardless of the level of competition in the market is expected to help protect patient access to PDMPs. The list of PDMP presentations covered will match that in VPAG and cover:

• high-purity factor IX
• factor X
• factor XIII
• factor VIII plus von Willebrand factor
• von Willebrand factor
• fibrinogen
• protein C human
• C1-esterase inhibitor
• normal immunoglobulin human
• anti-D immunoglobulin
• albumin human
• human alpha₁-proteinase inhibitor
• human prothrombin complex concentrate

Older medicines with annual measured sales of less than £1.5 million across one VTM by one scheme member will be exempt from the top-up payment percentage. This is aimed to protect patient access to medicines in small markets where companies may not benefit from economies of scale. DHSC will reserve the right to not apply this exemption where, in the reasonable opinion of DHSC, the scheme member has artificially reduced their annual revenues across a VTM through commercial relationships with another company, including but not limited to licensing arrangements.

Question

Do you agree or disagree that there should be an exemption from the top-up payment percentage for relevant plasma derived medicinal products (PDMPs)?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Question

Do you agree or disagree that there should be an exemption from the top-up payment percentage for sales of older medicines with annual measured sales of less than £1.5 million across one VTM by one scheme member?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Operational requirements

Sales reports

To implement these proposals, sales reports will need to include a breakdown of the proportion of sales that relate to newer and older medicines. For sales of older medicines, only the basic payment percentage will be due at the time of the submission of the quarterly sales report. However, companies will additionally be asked to submit an estimate of the relevant top-up payment that they expect will apply in relation to that quarter.

Following consultation in 2023, exemptions were introduced for ECPs, CPVs and NASs. To implement these exemptions, sales reports will be required to include data (previously not included) on:

• sales of products qualifying for the CPV exemption
• sales of products qualifying for the ECP exemption
• sales of products qualifying for the NAS exemption

Presentation reports

Presentation reports will now be required no later than 3 months following the end of the financial year. They will be used to calculate average selling prices, reference prices and establish the sales of newer and older medicines at branded presentation level and, therefore, the levels of industry measured sales, eligible sales and payments due on these categories of medicine.

If companies have a financial year that does not end on the last calendar day of a calendar year, or if payment percentages change within a calendar year, companies will be required to provide at least 2 presentation reports in each year.

Audited sales reports

Companies will also be required, as now, to submit an audited annual sales report within 9 months of the end of their financial year. The audited sales report will now be required to include data on sales of newer medicines and older medicines, including scheme payments owed for different top-up payment percentages of older medicines. DHSC’s intention is that, as far as possible, this data will be populated using data from the presentation report. If companies have a financial year that does not end on the last calendar day of a calendar year, or if payment percentages change within a calendar year, companies will be required to provide at least 2 audited sales reports in each year.

General points

Requirements relating to the implementation of the differentiated approach to setting payment percentages for newer medicines and older medicines do not apply to small companies as they are exempt from scheme payments.

We propose that DHSC should be able to request information from scheme members where reasonably required to enable DHSC to establish the reference price of a scheme product. This can include (but is not limited to) the SPC or marketing authorisation expiry date, the observed average selling price of a branded presentation over a given period, or the name of the originator product for a branded presentation.

Question

Do you agree or disagree with this approach to DHSC implementing the proposals?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Small company sales exemption

Under VPAG, sales by companies with sales below £6 million do not attract payment or count towards overall measured sales. Currently in the statutory scheme, the small company exemption applies to companies with sales below £5 million, as was the case in VPAS.

We propose that the threshold for being a payment company in the statutory scheme is increased to annual sales of £6 million. As is the case currently, this will be measured based on total sales in the previous year.

This change will support smaller suppliers of branded medicines, recognising the challenges faced by such companies in operating with lower economies of scale, and giving them greater space to establish themselves within the market. This reflects a desire to support a heterogenous life sciences industry and the importance of smaller companies in UK-based employment and economic growth.

Question

Do you agree or disagree that the statutory scheme should implement an increase in the small companies exemption to those companies with sales below £6 million?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Impact of the proposal

The impact assessment published alongside this consultation sets out that proposals will help to ensure the continued effectiveness of the statutory scheme.

Specific consultation requirements in the NHS Act

The statutory scheme was established using powers under section 263(1) of the NHS Act 2006. In exercising that power DHSC must include in the consultation its assessment of the:

• economic consequences for the life sciences industry in the UK
• consequences for the economy of the UK
• consequences for patients to whom any health service medicines are to be supplied and for other health service patients

An assessment of the likely impact of the proposals, including on the above areas, is set out in the impact assessment which accompanies this consultation.

Question

Do you agree or disagree with the analysis in the impact assessment of our proposals, including impacts on those areas where the NHS Act 2006 requires that we consult?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

Statutory duties

There are some specific duties that must be considered when proposing updates to the statutory scheme. These include consideration of the Secretary of State’s duties under the NHS Act 2006, the public sector equality duty under the Equality Act 2010 and the family test.

Duties under the NHS Act 2006

To promote a comprehensive health service (section 1 NHS Act 2006)

The Secretary of State is required to continue the promotion in England of a comprehensive health service designed to secure improvement in:

• the physical and mental health of the people of England
• the prevention, diagnosis and treatment for physical and mental illness

The proposals aim to ensure the schemes can function effectively together to protect the NHS budget by ensuring affordable and predictable growth in spend as well as securing patient access to medicines.

The new differentiated approach to setting payment percentages for newer medicines and older medicines will encourage innovation and efficient competition, by charging higher payment percentages on uncompetitive older medicines and lower payment percentages on older competitive medicines and newer medicines. This will make medicines more affordable for the NHS as well as encouraging investment in the latest effective medicines and therefore improve patient access to medicines.

In contrast, if DHSC were to proceed with the ‘do nothing’ option of maintaining one approach to setting payment percentages, the voluntary and statutory schemes would diverge, creating very different economic circumstances for companies in the life sciences sector to operate in. This would create a more unpredictable environment for business to operate in and it could destabilise VPAG such that neither industry nor government benefits within that scheme.

While the proposals mean that DHSC will receive lower statutory scheme payments than currently set out in the regulations, such short-term impact must be considered against the long-term stability of the mechanisms by which we control costs, and the impact of such mechanisms on the market of medicines. Protecting the stability of the system means that we will continue to receive payments that will be apportioned to the NHS across the UK and will be used in the best interest of patients.

We therefore consider that the proposed changes advance the Secretary of State’s duty to promote a comprehensive health service and support the relationship between the Secretary of State and industry, ensuring that the statutory scheme has the confidence of all parties involved.

To act with a view to securing continuous improvement in the quality of services (section 1A of the NHS Act 2006)

The Secretary of State is required to exercise their NHS functions with a view to securing continuous improvement in the quality of services provided to individuals.

Our proposals will ensure the statutory scheme remains a viable alternative to VPAG by making the 2 schemes broadly commercially equivalent. This will help to ensure sales growth continues to be controlled, allowing the NHS to budget effectively and make decisions in the best interest of patients about the provision of services, including ensuring a quality service. Additionally, a differentiated approach to setting payment percentages which promote innovations and efficient competition will facilitate improvements in patient access to the latest cost-effective medicines.

In discharging this duty, the Secretary of State must have regard to the National Institute for Health and Care Excellence (NICE) quality standards which define quality and quality improvement for particular kinds of care and treatment. As set out above, a decision to maintain broad commercial equivalence with VPAG helps to ensure the effective operation of the schemes and ensures NHS costs are controlled, supporting the Secretary of State to meet duties in securing continuous improvement in quality of services.

To have regard to the NHS Constitution (section 1B of the NHS Act 2006)

Regard must be given to the values, principles, pledges and rights in the NHS Constitution.

The NHS Constitution has been taken into account when developing the proposals in this consultation. In particular, this has included considering the following principles:

• principle 1: the NHS provides a comprehensive health service available to all
• principle 4: the patient will be at the heart of everything the NHS does
• principle 6: the NHS is committed to providing the best value for taxpayers’ money

We have also considered these proposals in the context of the constitution’s pledges to, and the rights of, NHS patients. In particular, this has included consideration of the rights in relation to nationally approved treatments, drugs and programmes, which set out patients’ rights to drugs and treatments that have been recommended by NICE for use in the NHS, where the patient’s doctor says they are clinically appropriate.

As set out above, our proposals to bring the statutory scheme into broad commercial equivalence with VPAG help to ensure the effective operation of the statutory scheme. This will benefit the NHS and industry and will mean that appropriate payments are made to the health service. This in turn will support the NHS to provide a more comprehensive health service by allowing the NHS to continue to invest in pharmaceutical and non-pharmaceutical services. It will also ensure access to medicines recommended by NICE as clinically effective and cost-effective for patients and therefore value for money to the NHS and taxpayers.

To have regard to the need to reduce health inequalities (section 1C of the NHS Act 2006)

With their functions in relation to the NHS, the Secretary of State must have regard to reducing inequalities between the people of England with respect to the benefits that they can obtain from the NHS.

We do not envisage any negative impacts on health inequalities as a result of the proposal. Ensuring the continued sustainability of NHS medicines spending is critical to enabling the NHS to provide widespread access to medicines and respond to health inequalities. This is likely to benefit all patients in the NHS, and particularly the most economically deprived in the population, as medicine usage is greater in this group.

Certain groups, such as pregnant women and children, may be more likely to use older medicines because there is longer established evidence for their efficacy and safety. However, such groups will nonetheless benefit from a mechanism that ensures the NHS gets better value for such medicines. Such groups also make use of innovative newer medicines whose development is incentivised by these changes.

To promote research (section 1E of the NHS Act 2006)

In exercising their functions in relation to the NHS, the Secretary of State must promote:

• research on matters relevant to the NHS
• the use in the NHS of evidence obtained from research

The proposed approach will ensure the long-term sustainability of NHS medicines spend and the use of medicines in the UK. Sustainable growth in sales allows the NHS to invest in innovative products, in clinical research and in process innovation. Some elements of the proposal, namely the inclusion of a differentiated approach to setting payment percentages for newer medicines and older medicines, are designed to encourage innovation and will encourage companies to invest in developing the latest cost-effective medicines.

DHSC considers that research and development investments leads to ‘spillover’ effects - for example, through the generation of knowledge and human capital - which generate net societal benefits, compared to other companies spending their capital on other things. In addition, research and development investment could lead to improved medicines in the future that would be of benefit to patients and the health service.

Any additional revenues accruing to the pharmaceutical industry when compared with not updating the regulations are assumed to be invested in the same proportion as companies typically invest in areas such as research and development in the UK. Given this, and the small size of the additional revenues expected to accrue to the pharmaceutical industry as a result of these changes, we expect only limited positive impacts on research and development investment and associated spillovers when compared to the counterfactual (of making no changes).

To secure education and training (section 1F of the NHS Act 2006)

The Secretary of State must exercise their NHS (and other) functions to secure an effective system for the planning and delivery of education and training for the persons employed, or considering becoming employed, in the NHS or connected activities.

We have considered this duty in relation to our proposals and do not consider that they would affect education and training.

To review treatment of providers (section 1G of the NHS Act 2006)

The Secretary of State is required to keep under review any matter which might affect the ability of healthcare providers to provide NHS services or the reward available to them for doing so.

We do not consider the proposals would affect the ability of healthcare providers to provide NHS services or the reward available to them for doing so.

To report on workforce systems (section 1GA of the NHS Act 2006)

The Secretary of State must, at least once every 5 years, publish a report describing the system in place for assessing and meeting the workforce needs of the health service in England.

We do not consider this duty to be affected by the proposals in this consultation.

Public sector equality duty

This duty comprises 3 equality objectives, each of which needs to be considered separately. Ministers have regard to the need to:

• eliminate discrimination, harassment, victimisation and any other conduct that is prohibited by or under the Equality Act 2010
• advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it
• foster good relations between persons who share a relevant protected characteristic and persons who do not share it

The protected characteristics covered by this duty are:

• age
• disability
• gender reassignment
• marriage and civil partnership
• pregnancy and maternity
• race
• religion or belief
• sex
• sexual orientation

We believe that overall, our proposals will have a broadly positive impact on the equality objectives. This is because, by updating the statutory scheme, we are ensuring that it continues to function as a viable scheme and can meet its objectives in relation to safeguarding the NHS budget and ensuring medicines are available while supporting the life sciences sector. We consider that meeting these objectives is in the interest of all patients. This common interest is likely to foster good relations between different groups in society, including those that share a relevant characteristic and those that do not. Those who share protected characteristics will benefit directly, along with the rest of the population, from NHS financial sustainability and access to medicines. In particular, it is likely to provide greatest benefits to those individuals and groups that make greatest use of prescription products. This will include certain groups that share protected characteristics, such as older people, pregnant people and those with disabilities and long-term health conditions.

Certain groups, such as pregnant women and children, may be more likely to use older medicines because there is longer established evidence for their efficacy and safety. However, such groups will nonetheless benefit from a mechanism that ensures the NHS gets better value for such medicines, and furthermore such groups also make use of innovative newer medicines whose development is incentivised by these changes.

The proposals would mean that the NHS can continue to use its funds, including revenues from the statutory scheme, in the best interest of patients, including those with protected characteristics. The proposals may reduce revenues from the scheme compared to making no changes, which might be used to invest in other NHS services that also benefit patients. However, on balance these changes are designed to protect patients’ access to clinically effective and cost-effective medicines, including innovative new medicines which may benefit individuals with specific protected characteristics.

In particular, we believe that ensuring the sustainability of the medicines pricing system and securing access to medicines is likely to benefit specific groups where illness and use of medicines tend to be higher than in the rest of the population. These groups include those sharing protected characteristics, such as older people and those with disabilities and long-term health conditions. Providing these specific protected groups with access to medicines will improve health outcomes in these groups, leading to greater equality of opportunity between these protected groups and the general population.

The family test

The Secretary of State must consider, where sensible and proportionate, whether to apply the family test, when making policy. The family test questions are:

• what kind of impact might the policy have on family formation?
• what kind of impact will the policy have on families going through key transitions such as becoming parents, getting married, fostering or adopting, bereavement, redundancy, new caring responsibilities or the onset of a long-term health condition?
• what impacts will the policy have on all family members’ ability to play a full role in family life, including with respect to parenting and other caring responsibilities?
• how does the policy impact families before, during and after couple separation?
• how does the policy impact on those families most at risk of deterioration of relationship quality and breakdown?

We have considered the family test and believe the proposals will not have a negative impact in relation to any of the relevant questions.

Our proposals would ensure the sustainability of the statutory scheme and ensure that the costs of medicines to the NHS are controlled to affordable levels and that patients continue to have access to medicines. This will help support family members who require medicines and their carers to play a full role in family life through access to medicines and any services required through the NHS.

Environmental principles policy statement

The Environment Act 2021 requires ministers of the Crown, and those making policy on their behalf, to have ‘due regard’ to the environmental principles policy statement when making policy.

Ministers must identify the potential environmental effects (positive and negative) of the proposed policy and consider the 5 environmental principles:

• integration
• prevention
• rectification at source
• polluter pays
• precautionary

Ministers must incorporate the relevant principles in a proportionate manner.

Following consideration of this duty and the 5 principles, we do not consider that there will be any disproportionate environmental impacts as a result of these changes.

We consider that the use of medicines in the NHS may have some negative secondary (indirect) environmental effects. These include indirect greenhouse gas emissions, and contamination of the environment from the production and freight of medicines procured by the NHS. However, the changes to regulations will have no material additional impact on the production or freight of medicines procured by the NHS in comparison with the counterfactual (where the regulations are not updated). We therefore do not consider the changes to the statutory scheme will result in environmental impacts from changes in patient use of medicines in the NHS.

With regard to the broader environmental impacts from the use of medicines in the NHS, environmental considerations have been integrated throughout the way the NHS purchases medicines. For example, the NHS England Public Board has approved a roadmap to help suppliers align with the net zero ambition between now and 2030. This approach builds on UK government procurement policy (Procurement Policy Note 06/20 and Procurement Policy Note 06/21). Other policies that aim to address the environmental impacts of medicine use are in place across the UK.

We therefore do not consider that it would not be proportionate to include further measures within the statutory scheme to meet this duty, given the associated economic and social benefits to society of the policy’s primary objectives, and that impacts are being addressed through more proportionate means.

Conclusion on statutory duties

We believe that the proposals will help to ensure the Secretary of State continues to promote a comprehensive health service. The proposed changes ensure the long-term sustainability of the statutory scheme which, in turn, supports the sustainability of NHS spending on medicines and patients’ access to these medicines.

Question

Do you agree or disagree with our initial conclusions about the impact that the proposed updates to the statutory scheme will have in terms of the statutory duties of the Secretary of State?

• Agree
• Neither agree nor disagree
• Disagree
• Don’t know

Please explain your answer. (Maximum 500 words)

How to respond

The consultation will run until 11.59pm on 26 April 2024. We welcome responses from any interested person, business or organisation.

The easiest way to respond is by completing the online survey.

If you have additional evidence you wish to submit or are unable to use the online form, email statutory_scheme_consultation@dhsc.gov.uk. Do not send any personal information to this email address.

Privacy notice

Summary of initiative or policy

DHSC proposes to update the statutory scheme to control the cost of branded health service medicines.

Data controller

DHSC is the data controller.

What personal data we collect

We will be collecting information in relation to the following:

• the capacity a person is responding to the survey - that is, if the respondent is sharing their personal views and experiences, their professional views and experiences, or responding on behalf of an organisation
• if the person is responding as an individual, we collect information on their protected characteristics: age band (for example, 16 to 24, 25 to 34), sex, gender, region they live in, ethnicity, whether they consider themselves to have a disability or not and how this impacts their day to day activities - it will not be mandatory for individuals to provide this information in order to respond to the policy questions in the consultation
• if the person responding as an individual is sharing their professional views and experience, we will collect information on what sector they work in (the NHS, elsewhere in the public sector, private or voluntary sector and so on) - it will not be mandatory for individuals to provide this information in order to respond to the policy questions in the consultation
• if the person is responding on behalf of an organisation, we collect information on the type of the organisation they are responding as (for example, whether it is a pharmaceuticals company that is a member of either branded medicine pricing scheme, sector representative organisation, charity, NHS organisation and so on)
• the individual’s email address or organisation’s email address - it will not be mandatory to provide this information in order to respond to the policy questions in the consultation

How we use your data (purposes)

We will collect personal information via the survey for the consultation. If you write or email us directly then we will collect your personal information via this channel.

We need to hold your information to understand what capacity you are responding as this is crucial in our analysis of how our proposals will affect different individuals and organisations.

We ask you to provide your email address for the following reasons:

• if you need to contact us about amending or deleting your response, the only way we can verify that it is your response is via your email address
• if our policy team have a follow-up question to ask you, we can contact you

We ask you to provide information about your protected characteristics so that we can understand the range of individuals represented in the response to the consultation, as we would like to ensure that a broad cross section of the population is included in the consultation.

Legal basis for processing personal data

Under Article 6 of the United Kingdom General Data Protection Regulation (UK GDPR), the lawful basis we rely on for processing this information is:

e) public task (necessary to perform a task in the public interest or in the exercise of our official functions): for the processing of all other personal data

Under Article 9 of the UK GDPR, the condition we rely on for processing any special category data is:

h) health and social care (necessary for the purposes of preventative or occupational medicine, the provision of health or social care treatment and the management of health or social care systems and services)

Data processors and other recipients of personal data

This consultation is hosted via an online platform owned by SocialOptic, who are a contracted supplier of DHSC. SocialOptic will delete any personal data in line with the retention and disposal periods outlined in this privacy notice, or earlier if instructed to do so by DHSC.

Personal data if provided will be shared internally within DHSC with employees involved in this consultation. Some analysis of responses may also be undertaken by external consultants who will not have access to the full survey data and who will be contractually bound to adhere to DHSC policies.

International data transfers and storage locations

All data is stored on DHSC secured platforms in the UK.

Storage of data by SocialOptic is provided via secure servers located in the UK.

Retention and disposal policy

We will keep your information for one year and then will dispose of it from our DHSC secured platform.

How we keep your data secure

All data is stored on secure a DHSC platform and only people involved in the consultation will have access to this.

Your rights as a data subject

By law, data subjects have a number of rights, and this processing does not take away or reduce these rights under the EU General Data Protection Regulation (2016/679) and the UK Data Protection Act 2018 applies.

These rights are:

• the right to get copies of information - individuals have the right to ask for a copy of any information about them that is used
• the right to get information corrected - individuals have the right to ask for any information held about them that they think is inaccurate, to be corrected
• the right to limit how the information is used - individuals have the right to ask for any of the information held about them to be restricted - for example, if they think inaccurate information is being used
• the right to object to the information being used - individuals can ask for any information held about them to not be used. However, this is not an absolute right, and continued use of the information may be necessary, with individuals being advised if this is the case
• the right to get information deleted - this is not an absolute right, and continued use of the information may be necessary, with individuals being advised if this is the case

Comments or complaints

Anyone unhappy or wishing to complain about how personal data is used as part of this programme should contact data_protection@dhsc.gov.uk in the first instance or write to:

Data Protection Officer
1st Floor North
39 Victoria Street
London
SW1H 0EU

Anyone who is still not satisfied can complain to the Information Commissioner’s Office.

Their postal address is:

Information Commissioner's Office
Wycliffe House
Water Lane
Wilmslow
Cheshire
SK9 5AF

Automated decision making or profiling

No decision will be made about individuals solely based on automated decision making (where a decision is taken about them using an electronic system without human involvement) which has a significant impact on them.

Changes to this policy

We keep this privacy notice under regular review, and we will update it if necessary. All updated versions will be marked by a change note on the consultation page. This privacy notice was last updated on 18 March 2024.