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HDA UK Media And Political Bulletin – 8 December 2017

Media and Political Bulletin

8 December 2017

In response to the series of articles published in The Times on current medicines shortages and subsequent price rises, the HDA has sent a response to the paper, to view this response please follow this link.

Media Summary

NHS close to blowing entire winter fund on costly drugs

The Times, Billy Kenber and Chris Smyth, 8 December 2017

 

The Times reports that the NHS will burn through a £350 million emergency winter fund by the end of December because it has been overpaying for drugs. Supply problems affecting at least 100 drugs have led to the NHS approving temporary price rises of up to 4,000 per cent.

Ministers are now under pressure to protect patients and the NHS budget by getting to the root of worsening medicine shortages that have led to some cancer and mental health patients going without crucial drugs.

Manufacturers have accused wholesalers of increasing prices artificially. Martin Sawer, executive director of the Healthcare Distribution Association, has responded stating that any such accusation is an insult to the professionalism of his members and their legal obligation to maintain a continuous supply of medicine.

 

Drug Money

The Times, 7 December 2017

 

A leading article in The Times reiterates the publication’s concern of what it labels the ‘flawed pricing system’ that has led to excess spending by the NHS. Under agreed rules, recent shortages have triggered prices increases which are designed to ensure a continued supply of medication, but this increase has at times spiralled out of control, with one product that at one time cost the taxpayer £1.62 per unit, now costing £65.

The article continues that an agreement between the Department of Health and the pharmacist’s professional body, which allows for the price of hard-to-obtain drugs to be increased, is responsible for the recent increases despite a failure to restore supply.

 

 

 

Parliamentary Coverage

House of Commons Questions: NHS – Drugs, 7 December 2017 

Royston Smith, MP: To ask the Secretary of State for Health, what steps his Department is taking to ensure value for money on pharmaceutical procurement?

Steve Brine, MP: For unbranded generics the Government relies on completion to keep prices down which generally works well and has led to low prices of these medicines. We alert the Competition and Markets Authority (CMA) when we believe that competition does not work. In the case of liothyronine, the CMA is currently investigating Concordia’s potential abuse of its dominant position to overcharge the National Health Service for liothyronine.

In primary care community pharmacies are incentivised to source products at the lowest possible cost by allowing them to retain the medicines margin (the difference between what the NHS reimburses a pharmacy for a product and how much the pharmacy purchases it for) up to £800 million in England. In secondary care, competitive tenders ensure value-for-money to the NHS.

Full Coverage

NHS close to blowing entire winter fund on costly drugs

The Times, Billy Kenber and Chris Smyth, 8 December 2017

 

The NHS will burn through a £350 million emergency winter fund by the end of this month because it has to overpay for drugs, calculations show.

Ministers are under pressure to protect patients and the NHS budget by getting to the root of worsening medicine shortages that have led to cancer and mental health patients going without crucial drugs. Medicine wholesalers have been summoned to the Department of Health to explain their handling of the crisis. They denied that they had been manipulating the market.

Supply problems affecting at least 100 drugs have meant that the NHS has had to approve temporary price rises of up to 4,000 per cent, but even this has not prevented patients’ treatments being interrupted. Pharmacists report that hard-to-find drugs become immediately available when prices rise and Labour has called for a full investigation to make sure that the NHS is not being “taken for a ride”.

Mike Dent, director of pharmacy funding at the pharmaceutical services negotiating committee, said that it was “receiving unprecedented numbers of calls from community pharmacy teams who cannot get hold of certain medicines that patients need”. The National Pharmacy Association warned yesterday: “People could come to real harm if this continues.”

The Department of Health has a mechanism for granting temporary higher prices, known as price concessions, for drugs that are hard to obtain, with the aim of boosting supply. The NHS has spent £178 million in this way over six months, with the monthly cost rising from £2.5 million in April to £54 million in September.

An analysis of prescription data suggests that the government spent £56 million to cover cost rises in 81 drugs in October. This figure is expected to have risen further last month after concession requests for almost 100 drugs. The NHS has probably spent about £300 million because of drug shortages since April and will have spent about £350 million by the end of this month if the situation remains.

Ben Goldacre, who runs the Open Prescribing project at Oxford University, calculates that shortages of the migraine treatment sumatriptan and the antipsychotic drug olanzapine have cost more than £50 million in six months. He said: “The chancellor has pledged £350 million to help the NHS deal with the winter crisis. This may be entirely wiped out by the the excess costs from drugs going out of stock.”

Jonathan Ashworth, the shadow health secretary, said: “Ministers must hold a serious and open investigation into how drug prices are being set and, if there is evidence of market manipulations then ministers must make sure that companies are held to account. It is essential that the government step in to make sure that patients are able to access the medicines they need, when they need them, and that the NHS is not being taken for a ride on the costs.”

The government is investigating the cause of the shortages.

Manufacturers have accused wholesalers of increasing prices artificially. Martin Sawer, executive director of the Healthcare Distribution Association, which represents large wholesalers, said any such accusation was an insult to the professionalism of his members and their legal obligation to maintain a continuous supply of medicine.

Drug Money

The Times, 7 December 2017

 

It has become a cliché to say that the National Health Service will always need more cash than the Treasury can afford. Jeremy Hunt, the health secretary, said so recently. Insofar as the NHS is having to minister to an ageing population and pay for more and more exotic and expensive treatments, it is true that whatever money is made available for healthcare will never be enough.

All the more reason for the NHS to bear down on spending where it can. And yet, as we report today, the cost of many drugs used to treat several serious conditions is anything but under control. Recent figures suggest that in the six months to September, the health service paid out an extra £180 million to obtain medicines to combat prostate cancer, breast cancer and severe mental illness among other conditions.

The excess spending was caused by shortages of the necessary drugs. Under agreed rules, these shortages triggered price increases designed to ensure continued supply, but the increase spiralled out of control. In the most extreme cases they have been in the order of 4,000 per cent. One product that not long ago cost the taxpayer £1.62 a unit now costs £65. Such inflation in the price of a potentially lifesaving medicine is, to put it mildly, unfortunate. What shifts the situation from merely expensive to deeply problematic is that some suspect the shortages responsible for the price rises may have been deliberately caused by wholesalers in expectation of surplus profits. Pharmacists are mystified by a continuing difficulty in securing supplies of standard medicines manufactured by a variety of large companies. What is more troubling is that pharmacists say once the price has risen, these drugs sometimes magically become available.

The provision of pharmaceuticals is not like that of crops or coal or cod. There is no obvious variable involved in the mass production of drugs likely to create a sudden shortage and therefore a consequent spike in their cost.

Or maybe there is. A deal negotiated between the Department of Health and the pharmacist’s professional body allows for the price of hard-to-obtain drugs to be raised in extremis. This deal, which rejoices in the comically misleading name of a price concession agreement, is the mechanism that has enabled the recent increases even though they have signally failed to restore supply. Indeed, with pharmacists continuing to report unprecedented shortages, the system appears to encompass a poisonous cocktail of both irregularity and inefficiency.

HDA UK Media And Political Bulletin – 8 December 2017

From Factory to Pharmacy

As part of our mission to build awareness, understanding and appreciation of the vital importance of the healthcare distribution sector, we developed an infographic explaining the availability of medicines. It identifies the factors that can impact drug supply, as well as the measures that HDA members undertake day in, day out to help mitigate the risks of patients not receiving their medicines.

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