The government has proposed a statutory scheme to regulate prices and profits on the sale of drugs to the NHS.

Drug companies which don't co-operate could be liable to heavy fines, but the government has failed to spell out the precise conditions

under which such penalties would apply.

Defining what comprises excessive prices or profits is likely to present a number of empirical problems.

Experience overseas suggests that the scheme will fail to halt the inexorable rise in the NHS drugs bill.