Budget 2013: pharma ‘pleased’
pharmafile | March 21, 2013 | News story | Manufacturing and Production, Medical Communications, Research and Development, Sales and Marketing | Budget, Osborne, UK
Pharma and health bodies have broadly given George Osborne’s Budget a warm welcome, with cuts in corporation tax, increased R&D credit help and protection of the NHS’s budget singled out.
The ABPI declared itself ‘pleased’ that corporation tax will be reduced to 20% from 2015, and that the rate of the above-the-line R&D tax credit is rising to 10 per cent.
The BioIndustry Association (BIA) also supported the chancellor on these measures, as well as the abolition of stamp duty on shares traded on the Alternative Investment Market (AIM), which it says will help drive investment in bioscience.
The Ethical Medicines Industry Group (EMIG) liked the government’s support for R&D, and the fact that a proportion of the £1.6 billion available to support the government’s Industrial Strategy will be earmarked to implement its Life Sciences Strategy.
But chairman Leslie Galloway also sounded a note of caution.
“What EMIG members really need is some clarity about the future pricing and regulatory environment they will be operating in to enable them to plan for their long-term investment in the UK economy,” he explained.
Further action is needed to support future growth in the life sciences sector, he concluded.
The BIA also supported the extension the capital gains tax relief for the Seed Enterprise Investment Scheme, and said an employment allowance to take the first £2,000 off the employer National Insurance bill of every company was a positive step.
But while the NHS Confederation welcomed confirmation that the government will protect spending on health, it warned that other aspects of Budget 2013 will have major impact on the health service.
“NHS finances are under more pressure than ever, and demand for services is continually rising,” said the organisation’s chief executive Mike Farrar.
Local authority cuts in services may mean hospitals face greater numbers of people “in crisis, either needing healthcare in an emergency or having already passed the point where they can be helped to regain their health and independence”.
“That isn’t good for the sustainability of the NHS,” Farrar said.
He praised the decision to bring forward implementation of social care funding reforms, but warned: “2016 is still three years away. Immediate action to prevent the wheels falling off is needed now, in addition to radical reform in the future.”
Interest groups also used their response to the Budget to bang the drum for their own hobby horses, ABPI chief executive Stephen Whitehead reiterating that the UK lags behind in the adoption of new medicines compared to other European countries, and that the UK’s global share of clinical trials has fallen in recent years.
“The pharmaceutical industry in the UK is now at a crucial moment and we must reverse these trends if we are serious about maintaining the UK’s position,” he said.
Osborne’s line that “research and development is absolutely central to Britain’s economic future” was highlighted by the BIA, whose chief executive Steve Bates spoke of a ‘supportive environment for this sector’.
But he added: “The chancellor can do more to deliver a truly aspirational nation.”
To complement tax breaks for high-net worth individuals to invest in innovative companies, the BIA also wants to see the government bringing in Citizens’ Innovation Funds.
“The British public would like the chance to invest in the innovative companies that will deliver future jobs and economic growth in the UK,” he concluded.
Adam Hill
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