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Drug pricing

Government delays consultation with pharmaceutical industry over generics price limiting powers

Exclusive: Despite promising a consultation in “early 2019”, the Department of Health and Social Care says it wants to ensure its proposals to limit pricing of generic medicines are robust before it puts them to industry.

Sir Chris Wormald, permanent secretary at the DHSC

Source: Nick Williams / Flickr

Sir Chris Wormald, permanent secretary at the Department of Health and Social Care, said it would consult on its powers to limit generic pricing with the industry in “early 2019”, but this has been pushed back

A government consultation with the pharmaceutical industry over plans to use new powers to limit the price of generic medicines has been delayed until later in 2019, the Department of Health and Social Care (DHSC) has said.

The DHSC told The Pharmaceutical Journal that the consultation has yet to be sent out to the industry because it wants to ensure the proposals are sufficiently robust beforehand.

It said the consultation will be published later this year instead.

Sir Chris Wormald, permanent secretary at the DHSC, said in a letter to the House of Commons Public Accounts Committee (PAC), sent on 21 December 2018, that the DHSC was preparing “a framework for the use of its price-limiting powers” of generic medicines and would consult on this with the industry in “early 2019”.

In July 2018, the DHSC was awarded new powers to instruct pharmaceutical companies to reduce the price of a generic medicine or introduce other controls on their branded products in cases where it thinks drug companies are charging unreasonable prices for generics.

However, in a report on the rocketing prices of generic medicines published in September 2018, the PAC said that the DHSC had “not yet set out how it will use its new powers, should similar price rises happen again” and recommended that the DHSC “write to the [PAC] to set out the full range of actions it can take to address rises in the price of generic medicines, and what skills and capacity it has put in place to use its new powers”.

Responding in January 2019, Sir Chris said that the DHSC’s “powers to limit prices can only be implemented following a consultation of the relevant industry bodies”.

The proposed framework, which the DHSC has now confirmed will be consulted on later in 2019, is expected to detail which factors the DHSC will consider when setting the price of a generic medicine and the process it will follow.

Ash Soni, president of the Royal Pharmaceutical Society, said the timing of the consultation is “entirely within the gift of the DHSC”.

He added: “It is important that while the profession awaits this, there is a responsibility [on the government] to ensure contractors are correctly remunerated at the prices they are currently, and will continue, paying.

“The current payment structure makes it very difficult to make good purchasing decisions when it is unclear what the reimbursement level will be at the time of purchase.”

He said this uncertainty can “impact the mental wellbeing of all those involved, which also needs to be recognised by DHSC and NHS England”.

In March 2019, The Pharmaceutical Journal reported that the government halved its expenditure on price concessions in the previous 12 months, with pharmacists saying the cuts have left community pharmacy “in a dreadful position”.

Citation: The Pharmaceutical Journal DOI: 10.1211/PJ.2019.20206511

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