The government and the Association of the British Pharmaceutical Industry (ABPI) have agreed the outline terms of a deal enabling the NHS to get the best value and most effective medicines into use more quickly.
The voluntary scheme for branded medicines pricing and access is expected to come into effect from January 2019 after the final details have been finalised.
Parts of the deal agreed in the heads of agreement for the voluntary scheme include:
- faster assessments of the clinical and cost-effectiveness of all new medicines by the National Institute for Health and Care Excellence (NICE)
- NHS funding for all medicines recommended for use by NICE
- early engagement with companies to ensure clinicians and the NHS infrastructure are ready to use new medicines
The voluntary scheme is also designed to keep growth in the branded medicine bill predictable and affordable by placing a 2% cap on the growth in sales of branded medicines to the NHS.
Pharmaceutical companies will repay the NHS for spending above the 2% cap, which is expected to save the NHS £930 million in 2019.
Other measures to keep the cost of medicines to the NHS affordable are included in the plan, such as simplifying price controls, and faster and more flexible commercial discussions between the NHS and pharmaceutical companies.
If agreed in full, the voluntary scheme for branded medicines pricing and access will replace the Pharmaceutical Pricing Regulation Scheme (PPRS), which expires on 31 December 2018.
Health and Social Care Secretary Matt Hancock said:
This new deal will be good for patients, good for the NHS and good for the UK life sciences industry.
Cutting-edge and best value medicines will be fast-tracked and we will cut our medicines bill by £930 million next year following tough but constructive negotiations with the pharmaceutical industry – money we can reinvest into better NHS services, alongside the NHS long-term plan.
The deal will also ensure the UK remains an attractive hub for research and investment so the next generation of ground-breaking treatments can be developed here with patients benefiting earlier.
Health Minister Lord O’Shaughnessy said:
The agreement is a vote of confidence for our world-leading life sciences sector, and shows the NHS is ready to embrace innovation so that patients get the best medicines earlier.
Small and medium-sized business in particular will be better supported through greater flexibilities, helping SMEs to bring their innovative treatments into the NHS.
Mike Thompson, Chief Executive of the ABPI, said:
This agreement is a commitment by the government and the NHS to work with us to support innovation for the benefit of patients. This means that people across the UK should see better and faster access to the most effective new medicines and vaccines.
Under the scheme the NHS will have absolute certainty that the sales of branded medicines will not grow by more than 2% in any of the next 5 years – or industry refunds the money. This is a significant contribution by pharmaceutical companies to support the NHS.