NHS image

NHS makes £700m savings from medicines

pharmafile | June 22, 2012 | News story | Sales and Marketing Conferederation, NHS, QIPP, reforms 

The NHS has made £700 million in savings from prescription medicines over the past year.

This is according to the NHS’ ‘The Year’ report, which outlines how well the health service is meeting its QIPP savings target.

The report was published at this week’s NHS Confederation conference, and showed that the health service saved £5.8 billion between April 2011 and March 2012.

The biggest proportion of this – £2.8 billion – came from savings made in hospital care, but drug costs amounted for the second biggest set of savings at £700 million. 

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The £700 million figure is double initial estimates from the Department of Health, which said in December that it expected savings from prescribing costs to be around £370 million.

The prescription budget will remain firmly in the QIPP crosshairs, and the publication notes that: “The demands of an ageing population and increased costs owing to developments in drugs and advancing medical technologies present challenging financial conditions in a constrained economic climate.

“All parts of the NHS will need to take bold, long-term measures to rise to this challenge and deliver sustainable improvement in 2012/13.”

The government has set an ambitious target of making £20 billion worth of savings by 2015, meaning last year’s target will need to be met every year for the next three years if it is to be reached.

The savings are part of the government’s QIPP agenda, which aims to make major savings by improving quality, innovation, prevention and productivity in the health service. 

Much of the drug savings will come from patent expiries from major medicines, including Pfizer’s blockbuster statin Lipitor that went off patent in May, and the continued erosion of Sanofi/Bristol Myers Squibb’s Plavix.

But controversy still remains over how some of these targets are being met. Whilst QIPP aims to encourage an innovative approach to reducing drug costs, many NHS commissioners are still using ‘slash and burn’ tactics to make savings on the £13 billion a year drugs budget. 

This includes the use of ‘red’ and ‘black’ lists of drugs, which pressurises doctors into not prescribing high-cost treatments.

Last year, a series of Freedom of Information requests showed that primary care trusts were encouraging GPs not to prescribe a number of NICE-approved drugs, including Lipitor, AstraZeneca’s anti-cholesterol Crestor, and Amgen and GlaxoSmithKline’s Prolia for osteoporosis.

Given that the NHS must continue to find savings until 2015 and will need to increase its current trajectory to meet these ambitious targets, pharma can expect such controversial practices to continue.  

QIPP Category

Grand total of savings between April 2011 and March 2012

Acute services

£2.8 billion

Ambulance services

£74 million

Community services

£463 million

Continuing healthcare

£159 million

Mental health services

£440 million

Non-NHS healthcare

£157 million

Prescribing

£700 million

Primary care, dental, pharmacy, eyecare

£417 million

Specialised commissioning

£255 million

Other

£307 million

Total

£5.8 billion

Source: ‘The Year’ QIPP savings from the Department of Health

Ben Adams

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