Commissioners have been told they will gain easier access to the latest drugs approved by the National Institute for Health and Care Excellence after the Department of Health reached a deal on pricing with the pharmaceutical industry.
The pharmaceutical price regulation scheme, which was announced on Wednesday, introduces a cap on the overall level of NHS expenditure on branded drugs after it comes into force next year.
It is a voluntary agreement between the government and the drug sector’s lobbying body, the Association of British Pharmaceutical Industries, on behalf of the whole industry. It replaces the current voluntary pricing scheme, the 2009 Pharmaceutical Price Regulation Scheme, which comes to an end on 31 December.
Under the five-year deal NHS spending on branded drugs, which totalled £12bn in 2011-12, will remain flat for the first two years of the agreement. The three years up to 2018 will then see annual expenditure increases of just below 2 per cent a year.
Firms which receive payments above the allowed growth rates of the scheme will be required pay a proportion of it to the DH. This cash should then be passed on to clinical commissioning groups in the form of a rebate.
The precise rates at which PPRS payments will need to be paid by the companies involved has not yet been divulged.
The industry has said that in exchange for it agreeing to cut down the government’s branded drug bill - which the DH says had previously increased at a rate of 5 per cent each year - it wanted to see progress on uptake of new NICE-approved innovative medicines.
ABPI president Deepak Khanna told HSJ: “Now that we have agreed to a certain level of branded medicines growth over the next five years, the main thing is to work with the government to make sure patients have access to innovation and ensuring that patients have the right medicines at the right time.
“There is specific language in the agreement that will really work to help with the adoption of innovation.
“If there are situations locally where a medicine has been made available nationally but patients do not have access to it, that is where we will work hand in hand with the government and the NHS to say, ‘Now you need to remove these barriers’.”
With many key details of the latest scheme still to be announced, commissioners are yet to know the mechanics for distributing rebates that will accrue over the life of the voluntary scheme.
Mike Birtwistle, a founding partner at Incisive Health, said: “As a commissioner I would want to know whether I would receive my portion of a PPRS payment back if my prescribing costs increase by more than is projected.
“If I was a CCG finance director I would want to know what the distribution mechanism is. I wouldn’t want the money to disappear into a black hole in Whitehall as previous PPRS payments have done.”
Health secretary Jeremy Hunt said: “UK pharmaceutical companies have responded to the challenges we face as a country, both in terms of the increased demand for medicines and pressure on public spending.
“I hope in return we have given them the certainty and backing they need to flourish as a sector both here and in the global market.”