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Friday 21st October 2016

NHS drug cost price review

3rd August 2007

The Department of Health will conduct a review and enter into price negotiations with companies which provide the NHS with drugs.

Drugs & Money

Following the Office of Fair Trading's (OFT) condemnation of the Pharmaceutical Price Regulation Scheme (PPRS), the DoH will update the system. Currently, the PPRS lets providers decide on their own prices.

The OFT said the health service was paying huge amounts more than it should for drugs. The current annual cost of drugs for the NHS is more than £8 billion.

It said that changing the way drugs were priced - according to their health benefits rather than manufacturers' costs - might save the NHS £500m.

A Department of Health spokesman said the OFT had concluded that the "pricing system should have a more value-based approach...reform could deliver better value for money. The Secretary of State has therefore decided that it is timely to enter into a dialogue with the industry to renegotiate the PPRS."

Nigel Brooksby, president of the Association of the British Pharmaceutical Industry said that the PPRS had "many benefits" but they were in favour of a review. He stated  that the industry acknowledged the government's need to ensure "best value" for the health service.

Liberal Democrat health spokesman John Pugh called the relationship between the government and drugs providers "far too cosy" and welcomed the review.


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