NHS drug cost up for renegotiation

Source: Healthcare Digital

Date :02/08/2007 17:29:34

Health Secretary Alan Johnson is to renegotiate a five-year agreement with pharmaceutical companies on the price of drugs to the NHS.

The Office of Fair Trading has condemned the Pharmaceutical Price Regulation Scheme which allows drug companies to set their own prices.

Stating that NHS was paying drug firms hundreds of millions of pounds too much for branded drugs.

The Department of Health said the system needed updating for efficiency.

The OFT suggested a move to pricing drugs based on health impact rather than the cost to manufacturers could save £500 million from the NHS' current drugs bill which stands at more than £8 billion a year.

A Department of Health spokesman said: "The OFT concluded that the pricing system should have a more value-based approach in order to deliver greater benefit to patients.

"It said reform could deliver better value for money for the NHS. The Secretary of State has therefore decided that it is timely to enter into a dialogue with the industry to renegotiate the PPRS."

The Association of the British Pharmaceutical Industry said that the PPRS had done a ‘good job’ of delivering value for money in healthcare, but welcomed a review.

August 2 2007