On 1 December, the fortunes of the UK pharma sector changed radically, with the UK Government becoming the first in the world to secure a 0% US import tariff on pharmaceuticals. However, while zero tariffs may give UK pharma companies such as GSK and AstraZeneca an edge over neighbouring EU and Swiss companies, whose products are subject to 15% import tariffs in the US, the accompanying terms of the deal may have even more far-reaching consequences for the UK economy, since they include measures that have been high on the wish-list for many firms investing in the UK pharma sector in 2025.
There will be a much-needed, albeit temporary, resolution to major payback problems with the government’s main cost-containment mechanism for National Health Service (NHS) medicines, the clawback-based Voluntary Scheme for Branded Medicines Pricing, Access and Growth (VPAG), by capping payback at 15% in 2026–28. There will also be a long-overdue 25% rise in the National Institute for Health and Care Excellence (NICE) cost-effectiveness threshold for the NHS provision of novel medicines. This will be the first increase in this threshold for over 20 years. The UK government has also pledged to double the portion of gross domestic product (GDP) that it allocates to innovative drugs, from 0.3% to 0.6%, over the next ten years.
In return, alongside the zero-tariff element, the US will also avoid targeting UK drug pricing practices under the Most Favored Nation (MFN) strategy. READ MORE
by Janet Beal
Source: pharmaceutical-technology.com
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