The UK government has gone on to confirm its plans to move ahead with the proposed statutory scheme pharma rate surge. This means that the revenue recovery rate paid by the pharma companies that are subject to the statutory scheme for branded medicines will increase to 27.5% from the present 24.4%.
The Association of the British Pharmaceutical Industry- ABPI as well as one of the major global pharma companies have responded to this move, pointing out that the plans don’t happen to be supportive when it comes to the life sciences sector. The statutory scheme happens to be one of the two that keeps check on the branded medicine prices for the NHS. It is well to note that any organisation that gives out licensed branded medicines to the NHS is subject to the statutory scheme option unless it selects to join Medicines Pricing and Access. Through this scheme, the government looks to make sure that all the medicines supplied are at an affordable price, both in the broader economy as well as in the life sciences sector.
As per the ABPI, the finding suggests that sustaining such high costs for another half a decade will cause a loss of £50 billion to the UK’s GDP by 2058. Retaining high rates till 2033 would entail foregoing yet another £90 billion in GDP and a total of £29.9 billion when it comes to associated tax revenues until 2058.
The chief executive of ABPI, Richard Torbett, said that it is indeed very disappointing that the payment rate increase has been put in place. He also went on to warn that, based on the latest research that was recently published, such rates go on to impact the investment decisions of any company and also have quite a damaging impact.
The government has stated that such changes are expected to result in savings to the tune of £17 million to £19 million for the NHS by 2023. That said, Laura Steele, who happens to be the president and general manager of a global pharmaceutical giant, opined that the decision to increase the already sky-high recovery rate diminishes UK’s plans of becoming a science superpower and the government’s push towards fostering an environment for innovation in the life sciences.
Steele went on to conclude that they remain committed to collaborating with the UK government, the NHS, as well as the broader sector so as to look for a solution. She added that with so much to gain for UK patients, they by all means must look into repairing the present medicine pricing grid.