PM hints pharma could avoid ‘value-based’ pricing
pharmafile | March 9, 2007 | News story | Sales and Marketing | PPRS, Tony Blair, value based pricing, value-based pricing
Tony Blair has suggested that the government will not accept value-based pricing of pharmaceutical products as proposed by the Office of Fair Trading.
His words were welcomed by the ABPI as the industry has been bracing itself for a huge shake-up after the watchdog recommended scrapping the current profit-capping Pharmaceutical Price Regulation Scheme (PPRS).
“The OFT focused for understandable reasons on one aspect of the problem of drug pricing,” the prime minister said. “In our response, we need to take account of the broader picture including the needs of the industry which is a major strength in economic and science terms.”
It is the clearest hint yet that Labour may at least water down OFT proposals and Blair continued: “We need to be aware that that this is something that has a major effect on industry, and we want this industry in the UK.
“It makes sense to develop this sector and make it stronger. This sector is the future for the UK. I am sure we will continue to champion the sector in government.”
The OFT’s investigation into the PPRS concluded that the system does not represent good value for money or provide proper competition because it does not align price or profit incentives with the value of drugs. The watchdog cited countries such as Sweden, Australia and Canada as examples of successful value-based systems.
An ABPI spokesman told Pharmafocus that the prime minister’s words would give the industry confidence.
“It is very encouraging to hear that the Prime Minister acknowledges the importance of a strong UK pharmaceutical Industry and the ABPI thoroughly endorses his comment.
“The PPRS has, through the stability it has brought to the UK, proved an important factor in maintaining the strength of UK research and development – which has brought benefits for patients and the taxpayer alike.”
Blair made his comments while visiting biotech group Amgen’s new £100 million European Development Centre in Uxbridge.
He also pledged that the last months of his premiership would be marked by a big push’ in biotechnology and pharma, reviewing policy to keep the UK industry competitive against the US, and emerging rivals such as China and India.
The government would look carefully at the regulatory framework to reduce the gap between research and commercial development, he added.
“I recognise that in the regulatory environment we need to do more to get things moving faster and better,” and he pointed to the efforts of the government to provide a favourable environment for bioscience, including its introduction of legislative action on animal extremism and supporting an environment for stem cell research.
“We are one of the leading countries in Europe in bioscience, but actually, this is an international market. This is the moment we need another push and this is something I would like to do before I part from my office,” he concluded.
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