UK NHS spending on advanced medicines set to decline

Generic medicines use is the main driver behind future growth of the total NHS medicines bill

A new forecast published by the Office of Health Economics, for the ABPI, has shown that total NHS spending on medicines is well under control, whilst expenditure on innovative branded medicines is actually set to shrink in real terms and as a proportion of the healthcare budget over the next three years.

This has raised concerns from the head of the research-based pharmaceutical industry in the UK about how little the NHS is spending on the most innovative medicines and the slow speed at which patients can access new treatments compared with our European neighbours.1

The research found that while the total amount spent on the NHS is set to rise by 2.5% a year between 2011 and 2015, spending on new branded medicines will rise by just 1.3% annually. There will be a very slight increase in the growth of the total amount spent on medicines annually from 3.5% (the figure for 2007 – 2011) to 3.7% per year up to 2015, which is driven by an increase in the proportion spent on generic medicines. The figures also revealed that in three years’ time medicines launched between 2012 and 2015 will account for less than 2% of total spending on medicines.

In good news for the NHS, the expiry of patent exclusivity for medicines over the next three years will save the healthcare system a total of £3.4bn and demonstrates that the research-based pharmaceutical industry is playing its part in delivering efficiencies.

Commenting, Stephen Whitehead, chief executive of the ABPI said: “This report spells out the very good value for money that the NHS derives from our medicines and shows the system is achieving huge savings from medicines coming off patent. Branded UK prices are already amongst the lowest in Europe and we spend less than one per cent of GDP on medicines, which is almost half the average for major pharmaceutical markets.

“But I am deeply concerned that these savings are not being reinvested back into the system because these figures show our spending on the newest and most advanced medicines is declining in real terms. This spells bad news for the discovery of new life saving medicines and ultimately the health and well-being of UK patients.

“We have to stop thinking of medicines as a cost and see them for what they are – an investment. An investment in the future of medical research, an investment that reduces expensive hospital stays and unnecessary visits to GPs, an investment in the UK economy and – most importantly - an investment in people’s health.

“Looking ahead, as we start to prepare for negotiations with Government on the next medicines pricing scheme, we need to see our medicines rewarded for the high risk and cost of research and development. And once medicines are ready for use by patients, we want them available on the NHS as quickly as possible so as many patients as possible can reap the health benefits.”

1. 11th Pharmaceutical Price Regulation Scheme (PPRS) Report to Parliament