Parliament Debate Calls for New Approach to VPAS to Protect UK Life Sciences
A Parliament debate has called for a new approach to the Voluntary Pricing and Access Scheme (VPAS) if the UK is to be seen as an attractive place for life sciences.
VPAS is an agreement on pricing and rebates between the Government - through the Department of Health and Social Care - and the Association of the British Pharmaceutical Industry (ABPI) and manufacturers or suppliers who signed up to VPAS. Under VPAS, there is an annual repayment rebate, which suppliers of branded medicines including branded generics, in vivo diagnostics, blood products, dialysis fluids, branded products supplied through tenders or central contracts and biological medicinal products (whether branded or unbranded) have to pay. The reason for the rebate is to enable growth in the medicines budget to enable more innovation and better health outcomes, but only up to a certain limit. If too much is spent on medicines, then the industry has to pay some money back through the VPAS rebate.
There has been uproar in the industry over the effects of the current VPAS deal, which runs out in December this year. Negotiations for a new five year deal have just started between the DHSC and the ABPI.
Different parts of the pharma industry have been warning of dire consequences given the state of the current pricing deal. The ABPI has recently said "the industry is at a crossroads". This come after two big pharma companies, Eli Lilly and AbbVie, pulled out of the current voluntary pricing scheme. Meanwhile, Leslie Galloway, Chair of the Ethical Medicines Industry Group (EMIG), warned that a survey showed that 50% of its members were reducing supplies of medicines in 2023 and a further 40% were discussing a reduction. David Watson, the ABPI lead responsible for strategy on the next pricing deal, has also recently said that the current VPAS scheme was "in crisis". And Mark Samuels, the Chief Executive of the British Generic Manufacturers Associations (the BGMA), warned last year that branded generics companies were having to withdraw products as the operating environment is simply unfeasible. Now, the BGMA, which represents generic and biosimilar manufacturers, feels so concerned that its members' interests will not be protected in the new VPAS deal and that this could be an existential threat to their ability to supply in the UK, that the BGMA has commenced judicial review proceedings to take part in the negotiations.
What Happened in the Parliamentary Debate?
Anne Marie Morris MP led the debate. The focus of the debate was about encouraging life sciences investment into the UK. Contributors to the debate were critical of the environment under the current VPAS deal on patients, the NHS, industry and the economy; and there were strong comments that suppliers were not prioritising the UK when launching and supplying new and existing medicines because of the high amounts of the rebates under VPAS.
Anne Marie Morris called on an increase in allowance of 4% growth per year on medicine spending; and also that money received from the rebates to be specifically used to implement the missions from the Life Sciences Vision in which the Government shared a long-term plan for a thriving life sciences sector in the UK.
Will Quince MP, the Minister for Health and Secondary Care, responded in positive terms by saying that the new VPAS deal would aim to deliver a 'four-way win' for UK plc, the NHS, patients and "most importantly", the industry. However, he could not comment in detail given the sensitivity of the current negotiations and he seemed to also stick to the line about the benefits of the current VPAS system. He added that we was open to ideas about how the future scheme could operate.
He also stressed the importance of wider factors impacting life sciences investment in the UK, including regulation, R&D tax credits, uptake of new medicines, clinical trials and the NHS as an innovation partner particularly in clinical trials through its unparalleled access to real world data.
Hear More About These Issues at the PING Conference
VPAS is such a hot debate in pharma. Parts of the industry are warning of dire consequences for their ability to continue to invest in the UK and supply medicines here, given the current environment. This will ultimately be terrible news for patients and the country. Something has to change. Although there were mixed messages from the Minister about the new deal, it was positive to hear that he was open to new ideas.
At the invitation-only PING Conference, which VWV is holding on 19 June 2023 in association with EMIG, we will be hearing about the impact of VPAS on suppliers of medicines, as well as the likely new pricing scheme, which will be in place from 2024. You can also have your say with your thoughts.
At the Conference, we will be hearing from Richard Williams, an expert on VPAS issues, who will be updating us; and Richard will be in conversation with EMIG's Leslie Galloway. They will also look at what they expect to happen next on this hot topic.
Other themes at this year's PING Conference will include issues over regulatory approvals, skills and space.