Industry groups have welcomed the government’s decision not to introduce further price cuts for branded medicines not covered by the UK’s voluntary Pharmaceutical Price Regulation Scheme, but concerns remain.

Responding to the consultation on changes to the statutory scheme governing companies opting out of the PPRS, the government has promised to keep the price cut level, but it failed to define for how long. 

“Whilst it is good news for now that no further price cuts will be imposed on branded medicines on top of the 15% imposed last year, I am concerned that there may be further cuts to come,” said Stephen Whitehead, chief executive of the Association of the British Pharmaceutical Industry, particularly as medicines spend is already low. 

“The overall spend on medicines only represents 9.6% of total UK NHS spend. Furthermore the total medicine costs in the UK represent 0.9% of GDP compared to 1.2% average across other countries,” he said, noting that its important “to recognise the value that the industry’s medicines bring to the NHS and most importantly to patients”.

No taper for SMEs

Elsewhere, Leslie Galloway, chairman of the Ethical Medicines Industry Group, said he is “delighted” with the discount freeze given given that companies “had opted for a higher price cut under the statutory regulations in the interests of stability and predictability”.

But he also expressed disappointment that a ‘taper’ has not been introduced to the statutory regulations so that companies with annual NHS sales of up to £25 million would have benefit from the first £5 million being exempt from the price cut.

These small medium enterprises are being “unfairly penalised,” and “an opportunity has been missed to champion and stimulate smaller companies to invest and innovate,” he argues.