Headline agreement on five-year PPRS from 2009

Department of Health announcement (about 2 pages) of an agreement with the pharmaceutical industry on the pricing of medicines. The new PPRS is for five years, presumably starting on 1 January 2009 when the interim 2008 PPRS ends. An partial agreement had been announced in June 2008.

The Department emphasises a cut in the price of drugs supplied to the NHS of 3.9 per cent from February 2009, with a further 1.9 per cent fall from January 2010, but does not say how these price reductions are to be shared between branded and out of patent medicines.

Generic substitution is to be introduced from January 2010, with “further price adjustments on January of each year aimed as the proportion of savings from generic substitution varies with time” (no details given).

Companies are to be allowed to raise the price of new drugs to be raised above an initially low level if “value is proven at a later date”.

For further information or advice please contact Pedro Fernandes.

Filed under Department of Health, Healthcare, Pharmaceuticals.

Reckon LLP is an economics consultancy with expertise in data analysis, economic regulation and competition law.

About Reckon