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Pharma slams PPRS deal

Published on 15/11/13 at 09:14am
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The fallout from last week’s new drug pricing plan in the UK is continuing as nine pharma firms write an open letter lambasting the PPRS policy and resulting price freezes.

The much-anticipated negotiations between the government and the ABPI were published last week, but the deal was instantly criticised by many in the industry.

In some ways the ABPI got what it wanted - Value-Based Pricing was all but removed and the PPRS deal remains intact, but with a little extra to be thrown in to allow NICE the ability to potentially recommend more medicines.

On the flip side for pharma, the government looks to have more control over the drugs budget and has therefore curbed its growth for the next five years, meaning it must remain flat for the next two years and grow by less than 2% for the three years after that.

If it goes over this level, the companies must make up the difference and reimburse the Department of Health with the extra money made.

But given the estimates of drug growth over the next five years - especially for hospital-based drugs such as biologics - this will amount to a de facto cut for the industry, something which has riled big and small pharma alike.

Open letter

In the letter signed by nine UK pharma leaders including those from Pfizer, Novartis and Sanofi, they write: “The government’s deal for the pharmaceutical industry could have been transformational for Britain. Instead we believe a critical opportunity has been missed to improve the health of the British public and wealth of the British economy.”

The signatories add that it has “failed to break down the barriers” which they believe are are currently preventing patients from being treated with new medicines.

They argue much as the ABPI has done for years, that the increase in the drugs budget which grows on average by around 5% on each year, and currently stands at just under £13 billion - is a ‘myth’.

Again much like the ABPI, they say that medicines should not just be seen just as a cost but as an investment and an “essential part of improving patient outcomes”.

“Yet, fewer than one in three medicines have been recommended by NICE for use in the NHS in line with their licence since 2005. And the proportion of medicines refused by NICE is only increasing,” the statement said.

“The prime minister [David Cameron] rightly wants Britain to lead the world in life sciences. At a time when there is fierce global competition to attract investment in life sciences, the commercial environment is critical.

“The government must work harder to get this right. It’s important that the impact that our medicines have on saving and improving people’s lives, and the innovation, economic stimulus and jobs that they deliver, is valued.”

The companies also take aim at NICE, saying the government ‘must look again’ at how the watchdog reviews medicines for use within the NHS.

“This means setting a new mandate for NICE to make the UK a world leader in the use of innovative, new medicines, so that NHS patients are among the first in the world to benefit from new treatments and innovation is recognised, valued and rewarded.”

NICE is currently consulting over how to add new value-based assessments into its traditional QALY formula to make its cost-effectiveness model less cold, and open to allowing more high cost medicines into the NHS.

Most of the drugs it has knocked back in recent times have been expensive oncology medicines such as Roche’s Avastin (bevacizumab) for its new ovarian cancer licence, and Sanofi’s Zaltrap (aflibercept) for colorectal cancer. Both were deemed not to be cost-effective by NICE given their high cost and relatively low clinical efficacy.

But many pharma firms in the UK still believe that NICE is a barrier for new medicines.

The firms end their letter with a stark warning: “The prime minister must act to make this happen. Failing to do so could damage Britain’s health and prospects for generations to come.”

A full list of the signatories are:

  • John Kearney - general manager UK and Ireland, Amgen
  • Sam Pearce - general manager UK & Ireland, Celgene
  • Nick Burgin - managing director UK & Ireland, Eisai
  • Geralyn Ritter - SVP global public policy & corporate secretary, MSD
  • Frederic Guerard - general manager UK & Ireland, Novartis
  • Peter Meeus - vice-president UK and Ireland, Novo Nordisk
  • Jonathan Emms - UK managing director, Pfizer
  • Steve Oldfield - managing director UK & Ireland, Sanofi
  • Steve Arnold - managing director British & Irish Isles, UCB

Ben Adams 

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