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PSNC stresses need for drugmakers' obligation to supply

World News | September 12, 2013


Lynne Taylor

PSNC stresses need for drugmakers' obligation to supply

The Pharmaceutical Services Negotiating Committee (PSNC) has again urged Ministers to create an obligation on drugmakers to meet supply needs, following concerns about pricing.

This month, the British Association of Pharmaceutical Wholesalers (BAPW) raised concerns about the stability of the supply chain if price reductions to branded medicines are made at the next adjustments, which are expected next January under the Pharmaceutical Price Regulation Scheme (PPRS). 
 
Such a move would have far-reaching consequences across the supply chain, in particular making it more attractive to export medicines, and thus exacerbating shortages of certain products in the UK, says the BAPW, which also expresses concerns about the "secretive" nature of the pricing talks.
 
The BAPW and the PSNC are urging the Department to consider taking this opportunity to create, within the PPRS, an obligation to supply. This would be within the scope of the industry's voluntary agreement and could help go some way towards sorting the stock shortages issue, they suggest.
 
While there is not yet sufficient detail to predict any price changes or the impact they would have on the market, the PSNC says it has been working already to ensure pharmacy contractors’ concerns are recognised in the discussions. 
 
The Committee also emphasises that placing an obligation on manufacturers to supply sufficient stock would help alleviate some of the problems pharmacies are facing, and says it has “explained this” to the Department. 
 
The BAPW points out that wholesalers and distributors manage the supply of the full range of product types, and their business models depend on cross-subsidies. Therefore, a sharp price drop in one business area could have damaging effects on continuity of supply and NHS costs.
 
“Price reductions for branded medicines could leave the supply chain in a more fragile state, whilst reducing the ability of wholesalers to purchase certain products,” says BAPW executive director Martin Sawer.
 
The group also notes its “great concern” that the price cut is due to take effect next January 1. The bigger the cut, the more pressure there will be for wholesalers to reduce stockholdings, as often there is no guarantee of credit recompense and, as Christmas and New Year is the busiest time for wholesalers, this could affect continuity of supply. The BAPW is therefore calling for a delay of one month for wholesale prices, in line with pharmacy practice.
 

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