Media and Political Bulletin – 30 June 2020

Media and Political Bulletin

30 June 2020

Media Summary

Watchdog investigating pharmacies over handgel prices

P3 Pharmacy, Pharmacy Network News, 29 June 2020

P3 Pharmacy reports that the UK’s consumer watchdog has teamed up with the General Pharmaceutical Council to warn pharmacies of the potential consequences of charging “unjustifiably high prices” during the Covid-19 pandemic.

In a joint letter issued this morning, the Competition and Markets Authority and GPhC criticise the actions of a “small minority of pharmacies” suspected of “seeking to benefit from the coronavirus pandemic by charging unjustifiably high prices for essential products, including hand sanitiser, face masks and paracetamol”.

Pricing concerns are widely understood to fall outside the GPhC’s remit. However, it said it was prepared to take action if it judges that there are “broader issues that would impact on public confidence”.

Parliamentary Coverage

Scottish Parliament Health and Sport Committee’s inquiry into the Supply and Demand for Medicines, 30 June 2020

Martin Sawer, Executive Director of the HDA, provided oral evidence to this inquiry. He said the decision to leave the EU had caused the NHS to become better at analysing shortages and horizon scanning, stating there was a “much better understanding of how much stock is around”.

Mr Sawer outlined steps taken by wholesalers to improve efficiency within the system, such as updated communication systems to provide better intelligence to pharmacists as to when they may expect stock to be available.

Both Warwick Smith of the BGMA and Martin Sawer noted ongoing European wide strategic discussions on resilience in the supply chain and the geographical centralisation of production of certain medicines and chemicals.

The full report can be viewed here.

House of Commons – Written Answer, 29 June 2020

Alex Norris (Nottingham North): To ask the Secretary of State for Health and Social Care, whether the Government plans to increase the level of long-term funding allocated to community pharmacies in response to the covid-19 outbreak.

Jo Churchill: The Department of Health and Social Care has indicated that it will not be possible to answer this question within the usual time period. An answer is being prepared and will be provided as soon as it is available.

House of Commons – Written Question, 24 June 2020

Mr Richard Holden (North West Durham): To ask the Secretary of State for Health and Social Care, what steps he is taking to stop wholesalers artificially inflating prices to pharmacies during the covid-19 outbreak.

Jo Churchill: The costs of branded medicines are controlled by the 2019 Voluntary Scheme for Branded Medicines Pricing and Access and the statutory scheme for branded medicines.

For unbranded generic medicines the Department relies on competition to keep prices down. This has led to some of the lowest prices in Europe and allows prices to react to the market. In an international market this ensures that when demand is high and supply is low, prices in the United Kingdom can increase to help secure the availability of medicines for UK patients.

Companies should not capitalise on the current COVID-19 situation by charging unjustifiably high prices for drugs and other supplies. Concerns about pricing abuse are a matter for the Competition and Markets Authority.

Full Coverage

Watchdog investigating pharmacies over handgel prices

P3 Pharmacy, Pharmacy Network News, 29 June 2020

The UK’s consumer watchdog has teamed up with the General Pharmaceutical Council to warn pharmacies of the potential consequences of charging “unjustifiably high prices” during the Covid-19 pandemic.

In a joint letter issued this morning, the Competition and Markets Authority and GPhC criticise the actions of a “small minority of pharmacies” suspected of “seeking to benefit from the coronavirus pandemic by charging unjustifiably high prices for essential products, including hand sanitiser, face masks and paracetamol”.

The CMA said it had recently launched investigations into four retailers, including pharmacies, suspected of charging “excessive and unfair prices” for hand sanitiser. If the watchdog reaches a finding that competition law has been breached this could lead to financial penalties being imposed.

The CMA said it recognised that pharmacies may be paying higher prices to wholesalers, but while these costs may be expected to influence retail prices “they do not justify the pharmacy increasing its own percentage mark-up on the wholesale price”.

Similarly, additional costs such as PPE and hygiene measures “might justify a limited increase in general mark-ups” during the crisis but do not warrant a disproportionate increase in the prices charged for essential items, said the CMA.

GPhC ‘writing to a number of pharmacies’

The GPhC said that during the pandemic it has “written to a number of registered pharmacies to remind them about the requirements to meet our standards in the context of concerns we’ve received about price increases”.

“In some cases we have asked the pharmacy to review the price they are charging for a particular item and consider whether this price should be changed, as well as inviting them to tell us about any actions they are planning to take.”

Pricing concerns are widely understood to fall outside the GPhC’s remit. However, it said it was prepared to take action if it judges that there are “broader issues that would impact on public confidence”.

“For example, any pharmacy or pharmacy owner found to have breached competition or consumer protection law risks facing action by the GPhC for damaging public confidence.”

The GPhC has seen a marked increase in complaints from the public during the pandemic, driven in part by a rise in concerns around the prices some pharmacies have charged.

Media and Political Bulletin

08 June 2020

Media Summary

Drug firms hike cost of life-saving pills by 800% during pandemic, meaning thousands of Britons may have faced delays or not had vital treatments

Daily Mail, Sally Wardle, 06 June 2020

The Daily Mail reports that drug firms could be investigated by the Government’s watchdog for ‘price gouging’ amid concerns they may profit from the Covid-19 pandemic.

“Medicines are subject to supply and demand,” explains Martin Sawer, executive director at the Healthcare Distribution Association. “If there is plentiful supply, then the price comes down. If supply can’t meet demand straight away, then the price goes up. These prices change on a daily basis.”

Prices paid by NHS chemists for antidepressants and a breast cancer treatment have soared by more than 800 per cent in recent weeks, The Mail on Sunday can reveal. While some pharmacies have paid over the odds in order to meet patient needs, others have been unable to, meaning that Britons may have faced delays or struggled to get the treatment they need.

The Government’s Competition and Markets Authority has said it will investigate price rises throughout the supply chain during the Covid-19 pandemic and take action against any increases which it considers to be “unjustifiable.”

Pharmacies partly to blame for quota crisis, wholesalers claim

P3 Pharmacy, Pharmacy Network News, 05 June 2020

Following a statement made last week by the PSNC, expressing its concerns over the rise in drug quotas being imposed by wholesalers and manufacturers, Pharmacy Network News spoke to HDA executive director Martin Sawer,

Describing quotas as an “emotive issue,” Mr Sawer said one of the main reasons quotas are used is to limit onward sale by pharmacies. “Quotas are there to ensure an even and fair distribution of product across the dispensing points and to eliminate some customers who might buy excess stock because they want to resell it, either within the UK [or abroad],” Sawer explained.

Mr Sawer said the HDA has discussed the issue of quotas with PSNC for some time and welcomed their efforts to “collect robust data”. The HDA will “see if we can learn any lessons” from the data, he said.

‘Virus drains no-deal Brexit medicines stockpiles’

BBC News, Faisal Islam, 08 June 2020

BBC News reports that, according to an internal pharmaceutical industry memo which was prepared for the government in May, after the pandemic ends there will be “less or zero product available in the market to allow for stockpiling a broad range of products” than there was in 2019, when stockpiling occurred in preparation for a possible no-deal Brexit.

The memo emphasises that the government needs to be storing a much broader list of medicines going forward, because of the joint challenge of the pandemic and in the event of a no-deal Brexit deal at the end of this year. But the pharmaceutical industry says that to have significant impact, the stockpiling will have to start in the next few weeks.

Parliamentary Coverage

House of Commons – Written Answer, 05 June 2020

Clive Lewis (Norwich South): To ask the Secretary of State for Health and Social Care, what steps his Department plans to take to ensure stocks of medicines for end of life do not run short.

Jo Churchill: As part of our concerted national efforts to respond to the COVID-19 outbreak, we are doing everything we can to ensure patients continue to access safe and effective medicines, including those used in end of life care. The Department is working closely with the pharmaceutical industry, the National Health Service and others in the supply chain to help ensure patients can access the medicines they need, and precautions are in place to reduce the likelihood of future shortages.

NHS England and NHS Improvement have advised clinical commissioning groups to establish local hubs to ensure rapid access to anticipatory medicines. These hubs could be a community pharmacy, primary care network (general practitioner practice), community hospital, acute or other setting where palliative medicines (including controlled drugs) can be safely and legally stored and rapidly released when needed.

The Department and NHS England and NHS Improvement have published a standard operating procedure (SOP) for the use of medicines labelled for one patient, who no longer needs them, to be used by another person, in hospices and care homes. This will protect the medicine supply chain and ensure that patients can access critical medicines at end of life. The SOP can be found at the following link:

https://www.gov.uk/government/publications/coronavirus-covid-19-reuse-of-medicines-in-a-care-home-or-hospice

Northern Ireland Assembly – Written Question Tabled, 05 June 2020

Mr Gordon Dunne: To ask the Minister of Health what additional funding has been put in place to support community pharmacies during the COVID-19 crisis.

Medicines and Medical Devices Bill, 05 June 2020

There are several new Public Bill Committee amendments which have been tabled to the Medicines and Medical Devices Bill which can be found here.

House of Commons – Written Question Tabled, 04 June 2020

Anne Marie Morris (Newton Abbot): To ask the Secretary of State for Health and Social Care, if he is taking steps to ensure that the public is consulted prior to bringing forward legislative proposals to grant pharmacists the power to amend prescriptions as they see fit in the event of shortages of medicine.

Full Coverage

Drug firms hike cost of life-saving pills by 800% during pandemic, meaning thousands of Britons may have faced delays or not had vital treatments

Daily Mail, Sally Wardle, 06 June 2020

Drug firms could be investigated by the Government’s watchdog for ‘price gouging’ – inflating the cost of vital medication needed by millions of Britons – amid concerns they may profit from the Covid-19 pandemic.

Prices paid by NHS chemists for antidepressants and a breast cancer treatment have soared by more than 800 per cent in recent weeks, The Mail on Sunday can reveal.

And dozens of other commonly taken drugs have seen extraordinary price increases during the pandemic. These include painkillers such as ibuprofen and co-codamol, antibiotics, and even medication to treat overactive bladders.

While some pharmacies have paid over the odds in order to meet patient needs, others have been unable to – meaning that thousands of Britons may have faced delays or struggled to get the treatment they need.

Some chemists say that due to shortages, they have at times not been able to give heart patients aspirin, which is prescribed as a blood thinner to prevent heart attacks.

Companies that supply the drugs claim price hikes are due to increased demand, lockdowns causing hold-ups in production and problems getting products from India and China, where most medicines are made.

But Government officials are also concerned that ‘a minority of bad apples’ may artificially inflate prices during the pandemic to make money.

Other examples of price gouging, investigated by consumer watchdogs in recent months, include high-demand products such as hand sanitiser, bleach and baby formula.

Experts are also warning that if a second wave of coronavirus hits in the winter, when demand for medicines is typically higher, there could be further cost increases and shortages.

‘When there are shortages, a pharmacist will do whatever they can to source that product,’ says Leyla Hannbeck, chief executive of the Association of Independent Multiple Pharmacies.

‘If they can’t get hold of it, patients will sometimes be switched on to similar-acting medicines. But with some antidepressants, for example, it’s not very easy to just switch a patient from one medicine to another – and if someone suffers from anxiety and depression, not having their medicine will make them more anxious.

‘Shortages of cancer drugs are also particularly difficult.

‘In a lot of instances, patients are put on drugs for specific reasons and it’s difficult to just substitute them for something else.’

The process of making and distributing prescription drugs is complex. Firstly, the raw ingredients that make them work, known as active pharmaceutical ingredients, need to be manufactured.

These are then transported to factories where they are made into tablets or prepared for injections into the patient. The finished products are traded between wholesalers until they are sold to pharmacies and hospitals, which dispense them to patients.

Today, the majority of generics – cheap, unbranded versions of commonly taken drugs – are  imported from abroad. Just 20 to 25 per cent of those supplied to the NHS for use in pharmacies and hospitals are made in the UK.

About a quarter come from India, and India gets 70 per cent of its raw ingredients from China.

‘We are at the end of a very long supply chain for some drugs,’ says Dr Andrew Hill, honorary senior visiting research fellow in the Institute of Translational Medicine at the University of Liverpool.

‘If anything breaks down, then we are in trouble.’

In February, some factories in China ceased production as Covid19 spread. And in March, India introduced restrictions on the drugs it would export, so it could meet its own demand for medicines. The effects of the disruption caused to the supply chain are still being felt in the UK.

Fin McCaul, who has owned and run a pharmacy in north Manchester for nearly 40 years, says two wholesalers he uses regularly have been recently out of stock of aspirin.

‘We have been spending a lot of time trying to source appropriate products, and working with GPs to find alter­natives that patients can switch to,’ he says.

Shortages of prescription drugs can also be costly.

‘Medicines are subject to supply and demand,’ explains Martin Sawer, executive director at the Healthcare Distribution Association, which represents wholesalers.

‘If there is plentiful supply, then the price comes down. If supply can’t meet demand straight away, then the prices go up. These prices change on a daily basis.’

The NHS reimburses pharmacists for prescription drugs they dispense, paying a set price known as a drug tariff. But when there are problems and a drug is in short supply, pharmacies may end up paying above the listed price to get hold of it.

If this happens, the Department of Health will meet the higher price and pay back pharmacies – this is called a concession.

The list of concession prices, published by the Pharmaceutical Ser­vices Negotiating Committee, gives a good indication of drugs which are in short supply. A total of 43 items were listed in March, but this grew to 74 in April and 80 in May.

Figures from May suggest the price of antidepressant sertraline was up by 823 per cent, with the NHS reimbursing £14.32 for a pack of 100mg tablets, instead of its usual £1.55. Exemestane, a hormone therapy used to treat breast cancer in post-menopausal women, soared in price by 827 per cent.

A 30-pack usually costs the NHS £6.64, but in May the concession price was £61.57.

The Government’s Competition and Markets Authority has said it will investigate price rises throughout the supply chain during the Covid-19 pandemic and take action against any increases which it considers to be ‘unjustifiable’.

Warwick Smith, director-general of the British Generic Manufacturers Association, says: ‘If manufacturers increase prices for no good reason, then we will be the first to criticise them.’

As the UK prepares for a possible second wave of Covid-19, some experts argue that the supply chain must be strengthened to ensure patients have access to essential, life-saving drugs.

Shortages so far have not just been limited to pharmacies, Dr Hill warns. ‘I’ve spoken to doctors who ran out of certain drugs in intensive care,’ he says.

He believes the Government must now consider how it will source drugs and the ingredients to make them to avoid similar problems for pharmacies and hospitals in the future. ‘At the moment, if China goes down, we don’t have another option,’ he says. ‘The key is to have at least a Plan B, if not a Plan C. As a last resort, we should have the ability to make drugs within the UK.’

For patients worried about shortages, the advice is clear. ‘Order your medicine seven days before you run out,’ pharmacist Fin McCaul says. ‘If there is an issue, this gives us time to source the medication, or speak to your GP about finding an alternative.’

A Department of Health and Social Care spokesman said: ‘Fluctuations in price for generic medicines are normal, but companies must not capitalise on the pandemic by charging unjustifiably high prices.

‘The Competition and Markets Authority has set up a taskforce to investigate reports about businesses behaving unfairly, and can take action if necessary.’

Pharmacies partly to blame for quota crisis, wholesalers claim

P3 Pharmacy, Pharmacy Network News, 05 June 2020

Pharmacists with wholesale dealer licences may be partly to blame for the growing impact drug quotas are having on UK pharmacies, the head of the Healthcare Distribution Association has claimed.

PSNC issued a statement this week expressing its concerns over the rise in drug quotas being imposed by wholesalers and manufacturers, inviting pharmacy teams to share their experiences as part of a data gathering exercise. The issue appears to have worsened during the Covid-19 crisis.

Speaking to Pharmacy Network News on Wednesday, HDA executive director Martin Sawer said one of the main reasons quotas are used is to limit onward sale by pharmacies.

‘Emotive issue’

Describing quotas as an “emotive issue,” Mr Sawer said: “There are 2,100 wholesale licences out there – our members only have about two per cent and the vast majority of the rest are owned by pharmacies.

“The challenge then is, if we distribute to a pharmacy that also has a wholesale licence then they could, if they wanted to, sell that medicines on.

“Quotas are there to ensure an even and fair distribution of product across the dispensing points and to eliminate some customers who might buy excess stock because they want to resell it, either within the UK [or abroad].”

Mr Sawer said quotas are “worked out at a macro level” by manufacturers, who allocate a certain amount of each medicine to the UK, and that wholesalers must “work with them to make sure that patients get those medicines”.

He did not respond when invited to share evidence of the impact pharmacies with wholesale licences have on the medicine supply chain.

Longer scripts a factor

Asked why quotas appear to be increasingly common during the Covid-19 pandemic, Mr Sawer told PNN that at the start of the pandemic the longer prescriptions issued by doctors had put strain on the supply chain.

“The doctors were prescribing three months’ worth of medicines at the beginning, and if this was one of the medicines under quota… that would start to be a challenge unless it was flexed because quotas are typically weekly or monthly allocations to a pharmacy.”

He also said that with some patients travelling across the country when lockdown measures were announced, prescription nominations “were moving around quite dramatically” and that this may have had an impact on quotas.

Global supply chain issues such as India’s temporary export ban may have had some impact on UK quotas but were not likely to have been “the big driving force,” Mr Sawer said.

Mr Sawer said the HDA has discussed the issue of quotas with PSNC for some time and welcomed their efforts to “collect robust data”. The HDA will “see if we can learn any lessons” from the data, he said.

“The issue is about manging stock to make sure the distribution is fair and equitable, and where that is not happening individual wholesalers working with manufactuers will work it out.”

‘Virus drains no-deal Brexit medicines stockpiles’

BBC News, Faisal Islam, 08 June 2020

The UK has been warned by the pharmaceutical industry that stockpiles of medical supplies have been “used up entirely” by the coronavirus pandemic.

A memo seen by the BBC advises the government to buy and store “critical” medicines to treat the virus.

Drug makers fear stockpiles cannot feasibly be built back up again, if the UK should fail to strike a post-Brexit trade deal with the EU.

The government said “robust contingency plans are in place”.

The spokesperson added: “We want a relationship with the EU which is based on friendly cooperation between sovereign equals and centred on free trade.”

However, firms fear disruption to global supply chains will seriously impact the NHS.

The internal pharmaceutical industry memo, which was prepared for the government in May, warns that after the pandemic ends, there will be “less or zero product available in the market to allow for stockpiling a broad range of products” than there was in 2019, when stockpiling occurred in preparation for a possible no-deal Brexit.

At the time, the industry itself paid for six weeks’ worth of stockpiles.

“Preparations for the end of the transition period must complement plans to secure the supply of coronavirus therapeutic and supportive products,” the memo says.

The pandemic has led to a massive increase in demand for medicines not previously stockpiled for critical care and respiratory medicines, such as inhalers.

At the same time, coronavirus lockdown measures imposed by governments have caused significant supply bottlenecks due to factory closures and export bans, as well as a drastic decline in air freight.

The memo was put together by a cross section of pharmaceutical industry groups anticipating preparations for a failure to strike a trade deal with the EU, alongside a refusal to extend the negotiating period.

If this happens, the UK would trade on World Trade Organization (WTO) terms, which would mean trade barriers from the start of next year.

Keeping the flow of medicines going

The memo goes on to remind the government that the flow of medicines has been kept going through the pandemic thanks to “international coordination and information sharing within global companies to ramp up, and where necessary, redirect manufacturing”.

As a result, the pharmaceutical industry writes: “We would warn against any drastic policies mandating wholesale changes to global supply chains, as this could fundamentally disrupt the supply of medicines for the NHS and patients in other countries.”

The pharmaceutical industry has long anticipated that a no-deal Brexit could cause congestion at the ports of Dover and Calais, which is the route that 90% of imported drugs and medicines from the EU take to get to the UK.

As a result, the industry has advised that the government itself will have to buy and store a longer list of “critical products” where “supply could be challenging due to either COVID-19 or the end of the [Brexit] transition period”.

The need for trading stability is even more important this year, because the pattern of demand for medicines is likely to be very different to normal.

That means, the memo says, that the government needs to develop a new broader list of critical products which “reflect the challenges posed by both the end of the transition period and continues response” to the coronavirus crisis.

Urgent government action needed

The memo also emphasises that the government needs to be storing a much broader list of medicines going forward, because of the joint challenge of the pandemic and in the event of a no-deal Brexit deal at the end of this year.

But the pharmaceutical industry says that to have significant impact, the stockpiling will have to start in the next few weeks, and even after the pandemic ends, stockpiling will not be possible for every medicine required.

In a normal year, Christmas would be “the worst time of year to ask companies to increase their stockpile levels”, the memo says.

The pharmaceutical industry is expecting the system of no-deal government-chartered freight ferries and aeroplanes to be re-established, given that border disruption is expected at the end of the Brexit transition period. It says the government needs to signal that this will be the case by next month.

And it has requested “urgent clarity” on the implementation of arrangements for Irish Sea trade, under the Northern Ireland Protocol.

The Association of the British Pharmaceutical Industry (ABPI), one of the organisations involved in drafting the report, says firms had “worked around the clock” during the pandemic to make sure medicine supply chains held up.

“With this pressure likely to continue over the coming months, the pandemic has reinforced why it is essential that the UK and EU reach a deal on their future relationship,” said ABPI’s chief executive Dr Richard Torbett.

In the meantime, he said its members would continue to work closely with government to put detailed plans in place.

“But not everything is in the gift of industry. Stockpiling is one element – having alternative supply routes and making sure that goods can continue to flow uninterrupted across borders is also critical,” he stressed.

Media and Political Bulletin

26 May 2020

https://www.gov.uk/government/publications/coronavirus-covid-19-travellers-exempt-from-uk-border-rules/coronavirus-covid-19-travellers-exempt-from-uk-border-rules

  • qualified persons and responsible persons for human medicines, clinical trials and pharmacovigilance
  • a worker with specialist technical skills, where those specialist technical skills are required for essential or emergency works or services (including commissioning, maintenance, and repairs and safety checks) to ensure the continued production, supply, movement, manufacture, storage or preservation of goods

Media Summary

Community chemists tell Boris Johnson they face financial ruin over higher drugs bills and PPE costs

The Times, Oliver Wright, 26 May 2020

The Times reports that hundreds of community chemists have warned Boris Johnson in a letter that they face financial ruin over higher drug bills and costs for PPE that is free to other parts of the health service.  Small pharmacies were given the cash to help them deal with the coronavirus crisis, but many have been operating at a loss over the past three months.

Mark Lyonette, head of the National Pharmacy Association, said that many of his members would have been “better off if they’d closed their doors to the public” and were bearing a “heavy burden” for their role in tackling the crisis.

Community chemists were given £300 million in government loans that the Treasury are now trying to reclaim. In the weeks before the lockdown was announced pharmacists were struggling because of customers stockpiling medicines. This led to wholesale price increases of many prescription medicines above the amount they are reimbursed by the NHS.

Parliamentary Coverage

There is no parliamentary coverage today.

Full Coverage

Community chemists tell Boris Johnson they face financial ruin over higher drugs bills and PPE costs

The Times, Oliver Wright, 26 May 2020

Hundreds of community chemists have warned Boris Johnson that they face financial ruin over government moves to claw back £300 million in loans.

Small pharmacies were given the cash to help them deal with the coronavirus crisis but many have been operating at a loss over the past three months.

A letter to the prime minister signed by more than a thousand pharmacists states that they have faced higher drug bills, overtime payments and costs for personal protective equipment that is free to other parts of the health service.

Some pharmacists have reported that they have struggled to obtain sufficient PPE and at least five pharmacy staff have died as a result of Covid-19.

Mark Lyonette, head of the National Pharmacy Association, said that many of his members would have been “better off if they’d closed their doors to the public” and were bearing a “heavy burden” for their role in tackling the crisis.

Senior industry sources said that there was huge frustration at ministers paying tribute to them in public while the Treasury was trying to reclaim the £300 million.

In the letter the pharmacists, making clear they stayed open while many GP practices were closed, ask Mr Johnson to intervene and warn that they are on the brink of collapse.

“Local community pharmacies have stayed open, continuing to see patients and supply vital medicines,” they write. “We are putting ourselves at risk every day to help keep Britain healthy. While we welcome recent comments from the government recognising the role that pharmacies are playing, we need to see these supportive words backed up with further concrete action.”

Although pharmacies were allowed to stay open, retail sales only amount to about 10 per cent of total revenues and many have reported a drop in sales during the period.

The £300 million was handed over because in the weeks before the lockdown was announced pharmacists were struggling because of customers stockpiling medicines. This led to wholesale price increases of many prescription medicines above the amount they are reimbursed by the NHS.

More recent NHS payments do not make up for the shortfall of what pharmacies have already spent on drugs and, they claim, they are in effect being asked to subsidise the health service.

Media and Political Bulletin

11 March 2020

Media Summary

Coronavirus: no need to stockpile medicines

Dispensing Doctors’ Association, Ailsa Colquhoun, 11 March 2020

Dispensing Doctors’ Association reports that pharmacies and GPs have been asked to discourage medicines stockpiling related to coronavirus concerns.

Guidance and resources for primary care professionals are available from Public Health England. These state that stockpiling can put a strain on the supply chain and exacerbate any potential shortages.

Other guidance states that practices and the wider healthcare community should work collaboratively with pharmacies to ensure business continuity.

EMA to consider coronavirus’ impact on EU medicines supply

PMLiVE, Lucy Parsons, 10 March 2020

PMLiVE reports that the EMA has organised the first meeting of an executive steering group, which will address the potential impact of the novel coronavirus on the medicine supply chain in the EU.

The executive group provides strategic leadership for urgent and coordinated actions within the EU to determine and address risks impacting the supply of medicinal products, in response to crises caused by major events like the COVID-19 outbreak.

In the context of the COVID-19 outbreak, the group is to identify specific EU-wide actions to protect patients from medicine shortage risks caused by actions taken to contain the spread of the virus. That could include shortages caused by temporary lockdowns of manufacturing sites in areas affected by COVID-19, or travel restrictions impacting shipment.

The group will also keep patients and healthcare professionals updated with regards to any risks to specific medicine shortages, and the remedial actions that may be taken as a result.

The EMA has also highlighted the important responsibility of pharma companies to ensure the continuity of medicines supply, including putting resilience measures in place such as increasing stock or dual sourcing of products and materials.

Coronavirus: PHE working with wholesalers to replenish stocks

C+D, Eliza Slawther, 10 March 2020

C+D reports that England’s chief pharmaceutical officer Keith Ridge has said Public Health England (PHE) is “working with wholesalers” to replenish stocks in the wake of the coronavirus outbreak.

Mr Ridge wrote a letter to community pharmacies in which he recognised the “new and increasing challenge” that coronavirus poses for “already busy pharmacies”.

The four-page letter also highlights the need to prevent patients from stockpiling medicines and the importance of pharmacies putting business continuity plans in place.

The letter reiterated that pharmacies should not encourage patient to stockpile medicines, which could “impact adversely on the supply chain and result in shortages”.

Paracetamol hit by coronavirus price hikes

P3 Pharmacy, 10 March 2020

P3 Pharmacy reports that community pharmacy contractors are reporting that wholesaler prices for paracetamol and other medicines have risen substantially in recent weeks due to the coronavirus outbreak. Last week, one contractor told Pharmacy Network News that prices for packs of 100 paracetamol tablets that were normally available for around 46p had risen to more than £2 with some wholesalers.

Paracetamol was one of the 26 active ingredients included on an export ban list published by the Indian government on March 3. This, combined with a slowdown in output from China due to the COVID-19 emergency, has contributed to significant price hikes on a number of drugs, contractors have said.

The Competition and Markets Authority said last week it was “monitoring reports of changes to sales and pricing practices” during the coronavirus outbreak, and the PSNC told Pharmacy Network News it was “keeping a close eye on the generics (including paracetamol) affected by recent price hikes”.

Depakote shortage

Dispensing Doctors’ Association, Ailsa Colquhoun, 10 March 2020

Dispensing Doctors’ Association reports that Depakote 250mg and 500mg tablets are out of stock until early April 2020. Alternatives include:

  • Parallel import companies
  • Syonell tablets
  • Belvo tablets

Clinicians are advised to prescribe generically. See the shortage notice for more information.

Ex-Ministry of Sound MD appointed health minister

HSJ, Dave West, 10 March 2020

HSJ reports that the government has appointed a health minister in the Lords, who will lead on innovation and life sciences. Lord Bethell was yesterday confirmed as Parliamentary Under Secretary of State at the Department of Health and Social Care, following last month’s resignation of Baroness Blackwood.

The hereditary peer has been a government whip in the Lords since last year, having previously worked as a businessman and as a political adviser, in public relations, as well as working as a reporter.

 

 

Parliamentary Coverage

There was no parliamentary coverage today.

 

Full Coverage

Coronavirus: no need to stockpile medicines

Dispensing Doctors’ Association, Ailsa Colquhoun, 11 March 2020

Pharmacies and GPs have been asked to discourage medicines stockpiling related to coronavirus concerns.

Guidance and resources for primary care professionals are available from Public Health England. These state that stockpiling can put a strain on the supply chain and exacerbate any potential shortages.

Other guidance clarifies:

  • Patients on repeat prescriptions should continue with their usual current repeat prescription durations, i.e., a month’s supply.
  • Professionals may need to depart from established procedures in order to care for patients and people using health and social care services. Key principles which should be followed, include the need to work cooperatively with colleagues to keep people safe, to practise in line with the best available evidence, to recognise and work within the limits of their competence, and to have appropriate indemnity arrangements relevant to their practice.
  • Practices, and the wider healthcare community should work collaboratively with pharmacies to ensure business continuity.

EMA to consider coronavirus’ impact on EU medicines supply

PMLiVE, Lucy Parsons, 10 March 2020

The European Medicine Agency (EMA) has organised the first meeting of an executive steering group, which will address the potential impact of the novel coronavirus on the medicine supply chain in the European Union.

In a statement issued this morning, the EMA said that it is already working with partners in the European medicines regulatory network to monitor the impact of the novel coronavirus – which causes the respiratory illness known as COVID-19 – on pharmaceutical supply chains in the EU.

The executive group provides strategic leadership for urgent and coordinated actions within the EU to determine and address risks impacting the supply of medicinal products, in response to crises caused by major events like the COVID-19 outbreak.

In the context of the COVID-19 outbreak, the group is to identify specific EU-wide actions to protect patients from medicine shortage risks caused by actions taken to contain the spread of the virus.

That could include shortages caused by temporary lockdowns of manufacturing sites in areas affected by COVID-19, or travel restrictions impacting shipment.

The group will also keep patients and healthcare professionals updated with regards to any risks to specific medicine shortages, and the remedial actions that may be taken as a result.

The EMA has also highlighted the important responsibility of pharma companies to ensure the continuity of medicines supply, including putting resilience measures in place such as increasing stock or dual sourcing of products and materials.

The US Food and Drug Administration has also said it is monitoring the possible risks to medicine supply chain risks caused by the COVID-19 outbreak, and has identified a list of drugs which source their active pharmaceutical ingredients (APIs) or finished products from China.

China – the worst affected country and epicentre of the COVID-19 outbreak – is a major manufacturer of a number of APIs used in a number of common drugs, especially in the US pharma market.

According to Reuters, around 88% of APIs used in drugs for the US market were manufactured overseas in 2018, with around 14% in that year produced in China.

The European concern over potential drug shortages comes amid a sharp rise of confirmed cases of COVID-19 in Italy, which today began a nationwide ‘lockdown’ after case numbers surpassed 9,000.

Although cases seem to be rising in a number of countries, new infections in China and South Korea appear to be slowing down.

AbbVie’s Kaletra/Aluvia – potential coronavirus treatment?

The growing number of cases in Europe has once again highlighted the need for effective treatments for the COVID-19 infection.

Researchers have been testing a number of existing and pipeline products to determine if they are effective against the virus, with one of those identified as potentially having a positive effect being AbbVie’s HIV treatment Kaletra/Aluvia (lopinavir/ritonavir).

However, although the company supports the experimental use of the HIV medicine as a treatment for COVID-19, AbbVie has said it cannot confirm media reports coming out of China that it is an effective treatment against the virus.

Although AbbVie has donated Aluvia to the Chinese government for experimental use, it said in statement that while it is “working with global health authorities to ensure we meet the need of COVID-19 patients (and) conduct the appropriate clinical trials”, it will also need to “ensure uninterrupted supply of the drug Kaletra/Aluvia for HIV patients around the world”.

Coronavirus: PHE working with wholesalers to replenish stocks

C+D, Eliza Slawther, 10 March 2020

Public Health England (PHE) is “working with wholesalers” to replenish stocks in the wake of the coronavirus outbreak, England’s chief pharmaceutical officer Keith Ridge has said.

Mr Ridge wrote a letter to community pharmacies yesterday (March 9), in which he recognised the “new and increasing challenge” that coronavirus poses for “already busy pharmacies”.

Gloves, aprons and fluid-repellent masks should be ordered from wholesalers for use by pharmacy teams but not sold to the public, Mr Ridge stressed.

PHE is collaborating with wholesalers to “ensure their stocks are replenished”, he said.

Mr Ridge added that packs containing gloves, aprons and fluid-repellent face masks will be “delivered to general practices early this week”. A “similar pack” will be sent out to pharmacies “later this week and early next week”.

“Strictly enforced arrangements for further replenishment will be in place,” Mr Ridge said, commenting that these would be “communicated to [pharmacies] shortly.”

The four-page letter also highlights the cancellation of the national clinical audit, the need to prevent patients from stockpiling medicines and the importance of pharmacies putting business continuity plans in place.

Pharmacies should create business continuity plans that identify “specific roles and actions” that could “support managing local demand” and “work in collaboration with” local healthcare providers, Mr Ridge said.

He also suggested that pharmacies with online booking systems make it clear at the booking stage that those potentially infected with the virus should not visit the pharmacy, but should instead self-isolate.

The letter reiterated that pharmacies should not encourage patient to stockpile medicines, which could “impact adversely on the supply chain and result in shortages”.

Official guidance for community pharmacy was published by NHS England last week (February 27).

PSNC: “Pressing for further support”

This week, the Pharmaceutical Services Negotiating Committee (PSNC) will be entering into “detailed discussions” with the Department of Health and Social Care (DH) and NHS England and NHS Improvement to “plan for the potential later phases” of the outbreak, the organisation said yesterday (March 9).

“We will be pressing for further support and protection for pharmacies that are already being impacted by the outbreak in the UK,” the PSNC announced.

The negotiating body explained it is looking to secure “cash flow solutions should contractors have to deal with rapidly rising medicines prices” and funding for pharmacies that have to close temporarily due to coronavirus. The arrangements would form part of the community pharmacy contractual framework.

The PSNC said it will also discuss how pharmacies could support patients with the virus who are self-isolating, and the potential redeployment of pharmacy staff to other community pharmacies or healthcare settings.

Paracetamol hit by coronavirus price hikes

P3 Pharmacy, 10 March 2020

Community pharmacy contractors are reporting that wholesaler prices for paracetamol and other medicines have risen substantially in recent weeks due to the coronavirus outbreak.

Paracetamol was one of the 26 active ingredients included on an export ban list published by the Indian government on March 3. This, combined with a slowdown in output from China due to the COVID-19 emergency, has contributed to significant price hikes on a number of drugs, contractors have said.

Last week, one contractor told Pharmacy Network News that prices for packs of 100 paracetamol tablets that were normally available for around 46p had risen to more than £2 with some wholesalers.

‘Unprecedented’

Today (March 10) Bristol contractor Ade Williams told PNN he was struggling to source any paracetamol and that any product that was available was selling for “two or three times normal trade prices”.

Mr Williams said he had seen wholesalers selling paracetamol for higher than his normal retail prices, such as a trade price of 99p for a pack his pharmacy usually sold for around 60p. He described this as “completely unprecedented”.

He said it had become “very difficult to get hold of any OTC pack size” because supplies were being rationed by wholesalers. Prescription pack sizes were also being affected, he said.

Mr Williams called for the sector to take a more proactive approach to sharing information on drug prices, noting that some patients heard of India’s export ban through national media reports and had begun stockpiling paracetamol before all pharmacy teams knew of the situation.

CMA ‘monitoring reports’

The Competition and Markets Authority said last week it was “monitoring reports of changes to sales and pricing practices” during the coronavirus outbreak.

The CMA said it “wanted to ensure that traders do not exploit the current situation to take advantage of people” and that it would consider any reports they were “charging excessive prices or making misleading claims about the efficacy of protective equipment.”

CMA Chief Executive Andrea Coscelli said: “We urge retailers to behave responsibly throughout the coronavirus outbreak and not to make misleading claims or charge vastly inflated prices.”

PSNC told PNN it was “keeping a close eye on the generics (including paracetamol) affected by recent price hikes”.

The negotiator also said it was having discussions with DHSC on “protection for pharmacies against sudden price rises”.

Depakote shortage

Dispensing Doctors’ Association, Ailsa Colquhoun, 10 March 2020

Depakote 250mg and 500mg tablets are out of stock until early April 2020. Alternatives include:

  • Parallel import companies
  • Syonell tablets
  • Belvo tablets

Clinicians are advised to prescribe generically. See the shortage notice for more information.

Ex-Ministry of Sound MD appointed health minister

HSJ, Dave West, 10 March 2020

The government has appointed a health minister in the Lords, who will lead on innovation and life sciences.

Lord Bethell was yesterday confirmed as Parliamentary under secretary of state at the Department of Health and Social Care, following last month’s resignation of Baroness Blackwood.

The hereditary peer has been a government whip in the Lords since last year, and has previously worked as a businessman — including as managing director for the Ministry of Sound nightclub — and as a political adviser, in public relations, and as a reporter.

He said on Twitter he was “honoured to be appointed a health minister [and] proud to be part of government’s [Lords] front bench team”.

Health and social care secretary Matt Hancock said: “A big welcome to Lord Bethell who joins the department as our Lords Minister, responsible for life sciences. Big shoes to fill, but I am sure he’ll make a big impact.”

Meanwhile, the Commons health and social care committee has launched its first major thematic inquiry since last year’s general election, on social care funding and workforce.

The inquiry announcement said: “The inquiry into social care funding will seek to establish how much extra money would need to be spent by government in each of the next five years to counteract the impact of a shortage of care on the NHS.”

Media and Political Bulletin

06 March 2020

Media Summary

Your Paracetamol Supply Depends A Lot On China

Bloomberg, Lionel Laurent, 06 March 2020

Bloomberg features an opinion article by Lionel Laurent, who reports you would expect the coronavirus outbreak to have focused the minds of Europe’s politicians and drugmakers on finding a vaccine. But it’s the continent’s fragile dependence on Asia for raw generic drug ingredients like paracetamol that’s proving a more immediate headache.

European Union health ministers are due to discuss the security of medical supplies on Friday, after warnings that the bloc faces potentially significant shortages of crucial components imported from China as the country attempts to get back to work after virus-related shutdowns. France has openly called for more manufacturing “sovereignty” from foreign suppliers, as it scrambles to guarantee the supply of masks and control the price of hand-gel to try to reassure the public.

Short-term ideas such as stockpiling or resource sharing will probably be examined today in Brussels. But supply risks have been known for a long time and will require deeper fixes, according to Philippe Luscan, an executive who oversees French drugmaker Sanofi’s industrial footprint. In an interview, Luscan outlines Sanofi’s own push to get pharmaceutical production re-shored back in Europe.

Europe could face more drug shortages as coronavirus squeezes supplies

Reuters, Francesco Guarascio, 05 March 2020

Reuters reports that Europe is experiencing delays in supplies of medicines and face masks because of coronavirus disruptions, according to EU and industry officials, compounding already acute shortages of drugs on the continent.

Many countries around the world rely on China, the source of the outbreak, for drug ingredients in an age of global supply chains, and are grappling with how to avoid shortages of vital medicines. A senior official from the EU Commission has said the European Union is assessing the delays in drug shipments from Asia.

The European concerns come as India, which is the world’s main supplier of generic medicines and also relies on Chinese ingredients, decided to restrict some drug exports.

“Many active pharmaceutical ingredients are produced in China and the virus outbreak is affecting the manufacturing capacity and stability of the supply of these ingredients,” the European Medicines Agency, an EU body, told Reuters. “This could potentially lead to shortages of medicines worldwide.”

The Commission said it had not yet seen shortages in the bloc caused by the virus. But any hit to supplies due to the outbreak could worsen existing shortfalls.

 

Parliamentary Coverage

Border Delivery Group Newsletter, HMRC, 05 March 2020

This bulletin provides the latest news from Government relating to UK borders during the transition period.

Government confirms plans to introduce import controls

The Chancellor of the Duchy of Lancaster, The Rt Hon Michael Gove MP, announced recently at a Border Delivery Group stakeholder event, that full border controls will be introduced after the transition period ends in December 2020. The decision avoids any trade distortions between the UK and EU and treats all UK exports and imports equally, meaning traders in the EU and GB will have to submit customs declarations and be liable to goods’ checks.

He also confirmed that the policy easements put in place in October 2019 will not be reintroduced as businesses have time to prepare. This includes the easement on Safety and Security declarations on imports from the EU.

The Future Relationship with the EU. The UK’s Approach to Negotiations

Government has published a 30-page document outlining its priorities for negotiations. The main element is the comprehensive Free Trade Agreement covering substantially all trade. It proposes a separate agreement on fisheries that will take back control of UK waters; an agreement on law enforcement and judicial cooperation in criminal matters to help protect the public and bring criminals to justice; and agreements in technical areas covering aviation, energy and civil nuclear cooperation which will help ensure continuity for the UK on its new footing as an independent sovereign nation.

You will have noted that the UK is not seeking a waiver in relation to Safety and Security declarations as part of the FTA negotiations, and will be implementing the requirement for Safety and Security declarations. Accordingly, we expect that the EU will implement UCC Safety and Security requirements on GB/EU trade. The UK will be able to set out our own requirements, consistent with the international SAFE framework and our border security ambitions. However, the default is the implementation of Safety and Security declarations in line with the rest of the world. The processes required to fulfil Safety & Security requirements will form part of the border operating model which BDG is working on with all relevant Departments, and plans to publish at the end of March.

HMRC extends customs grant funding deadline

HM Revenue and Customs (HMRC) has extended the deadline for businesses to apply for customs support funding to 31 January 2021.

The scheme, first announced in September 2019, had been due to close on 31 January 2020. To date, applications have been made for around £18.5 million out of a possible £26 million – meaning there is at least £7.5 million left to claim from HMRC.

As well as supporting recruitment and improved IT capability, the money applied for so far could potentially fund nearly 15,000 training courses to help traders submit customs declarations.

 

Full Coverage

Your Paracetamol Supply Depends A Lot On China

Bloomberg, Lionel Laurent, 06 March 2020

You would expect the coronavirus outbreak to have focused the minds of Europe’s politicians and drugmakers on finding a vaccine. But it’s the continent’s fragile dependence on Asia for raw generic drug ingredients like paracetamol that’s proving a more immediate headache.

European Union health ministers are due to discuss the security of medical supplies on Friday, after warnings that the bloc faces potentially significant shortages of crucial components imported from China as the country attempts to get back to work after virus-related shutdowns. France has openly called for more manufacturing “sovereignty” from foreign suppliers, as it scrambles to guarantee the supply of masks and control the price of hand-gel to try to reassure the public.

It may seem pretty insensitive to point the finger at China and politicize medical-supply issues, given the country’s own tally of infections and deaths from the Covid-19 disease. Yet the scale of pharmaceutical dependence on Asia clearly deserves more attention than, say, textiles. The data is patchy but France’s National Pharmaceutical Academy estimates the EU imports 80% of its “active pharmaceutical ingredients,” mostly from China and India. The U.K. medicines regulator estimates Chinese manufacturers make around 40% of all APIs used worldwide.

What makes Covid-19 so dangerous for imports is that it combines Chinese factory shutdowns with domestic political pressure to act aggressively. India, itself very reliant on China for pharmaceutical ingredients, spooked the world this week by announcing curbs on exports of common drugs including paracetamol. French laboratories have warned of possible medicine shortages later this year, according to Les Echos. Over in the U.S., which has similar supply issues when it comes to China, the Food and Drug Administration has said one drug is in short supply because of the coronavirus outbreak without naming it.

Short-term ideas such as stockpiling or resource sharing will probably be examined today in Brussels. But supply risks have been known for a long time and will require deeper fixes, according to Philippe Luscan, an executive who oversees French drugmaker Sanofi’s industrial footprint. In an interview in his Paris office — where handshakes are now discouraged, obviously — he outlines Sanofi’s own push to get pharmaceutical production re-shored back in Europe.

The company aims to spin off six European factories (in the U.K., France, Germany, Italy and Hungary) into a new listed entity by 2022, representing 1 billion euros ($1.1 billion) of revenue. That entity will strike deals with firms that want to expand EU production. The Covid-19 crisis serves as one “salutary” incentive to do so, says Luscan. There are others, he adds: Quality issues that have forced products off the shelves, rising labor costs in China, and a pollution crackdown that’s temporarily shuttered factories.

This alone is probably unlikely to reverse the forces of globalization. If so many generic ingredients are manufactured in Asia, it’s because the plunging price of off-patent drugs using them and the rising cost of building lucrative new drug pipelines have pushed drugmakers to seek out cheap bases abroad. The head of Swiss company Novartis AG’s generics business, Richard Saynor, said last month that some antibiotics were being sold in Europe for “less than the price of chewing gum.” Even Sanofi’s own initiative looks like an elegant way to free up capital from a low-margin business.

But Luscan’s initiative should also prod policy makers into doing their part to boost production. Viewing medicines as a strategic asset rather than a cheap commodity — one of the recommendations of Rosemary Gibson’s 2018 book “China Rx” — would be a good start, as would thinking up financial incentives to encourage local production. EU initiatives designed to boost new medical research are a good thing, but the security of generics shouldn’t be ignored.

The big unknown is how bad the current crisis could get. Bloomberg Intelligence pharma analyst Sam Fazeli warns that if Chinese factory production bounces back while the virus spreads in the EU, it’s possible that European manufacturing will become a bigger source of disruption. Officials in Brussels should bear that in mind when mapping out emergency scenarios.

Still, it’s a good thing overall that the EU is finally waking up to drug supply risks. It shouldn’t miss the opportunity to do something about it — or seed the makings of an even bigger headache when the next pandemic threat strikes.

Europe could face more drug shortages as coronavirus squeezes supplies

Reuters, Francesco Guarascio, 05 March 2020

Europe is experiencing delays in supplies of medicines and face masks because of coronavirus disruptions, according to EU and industry officials, compounding already acute shortages of drugs on the continent.

Many countries around the world rely on China, the source of the outbreak, for drug ingredients in an age of global supply chains, and are grappling with how to avoid shortages of vital medicines.

The European Union is assessing the delays in drug shipments from Asia, a senior official from the EU Commission said, as France warned it was over-dependent on China with about 40% of the country’s drug ingredients imported from there.

The European concerns come as India, which is the world’s main supplier of generic medicines and also relies on Chinese ingredients, decided to restrict some drug exports.

“Many active pharmaceutical ingredients are produced in China and the virus outbreak is affecting the manufacturing capacity and stability of the supply of these ingredients,” the European Medicines Agency, an EU body, told Reuters.

“This could potentially lead to shortages of medicines worldwide.”

The Commission, the EU’s executive arm, said it had not yet seen shortages in the bloc caused by the virus. But any hit to supplies due to the outbreak could worsen existing shortfalls.

NEEDED: FACE MASKS

A survey of 24 EU countries at the end of last year found all had experienced shortages of medicines in 2019, while the number of drugs in short supply grew in most states, according to the Pharmaceutical Group of the European Union (PGEU), a trade body.

Respiratory medications were not sufficiently available in nearly all surveyed states, the report found, raising worries about the EU’s preparedness for a large outbreak of coronavirus, which can cause pneumonia and other breathing illnesses.

Jan De Belie of the PGEU said that, as well as China, Europe could face supply problems from northern Italy, a region where many drug producers operate and which has suffered the worst outbreak of the new coronavirus outside Asia.

EU officials also warn the bloc is running short of face masks and other personal protective gear because of soaring demand, particularly in Italy.

Last week, the Commission launched a joint procurement effort on behalf of 20 EU states. But officials said that even if they could secure supplies, they were unlikely to be delivered before April.

“There is a shortage in the market for these products,” a Commission official told EU lawmakers in a hearing on Thursday. “We will have difficulty in meeting all the anticipated needs of member states.”

The official added the shortage caused dangers to medical staff, who are more exposed to infections, and warned about risks of not having enough healthcare workers if the outbreak spread further. Currently there are more than 4,000 case detected across EU states.

To counter the possible dearth of medical staff, the official told a second hearing later on Thursday that EU governments were considering mobilizing retired medical workers and students to cope with the outbreak.

On Friday EU health ministers will hold emergency talks in Brussels on coordinated measures to combat the epidemic.

Supplying for tomorrow’s needs

Pharma Times, Katrina Megget, June 2017

 

Pharma Times discusses the importance of optimising the supply chain to meet the future demands of the changing world of pharma. Accordingly, the challenge is to marry reduced complexity with a geographically dispersed system that is, at the same time, both agile and dynamic, and still satisfies customers’ needs. Research has identified 12 developments that have the potential to further impact the pharmaceutical supply chain over the coming years, such as added compliance and risk management measures or environmental pressures. On the flip side, the industry is well equipped to tackle these upcoming challenges and these developments are also likely to create opportunities for the industry.

 

Drug costs vary by more than 600% in study of 10 high-income countries

European Pharmaceutical Review, Niamh Marriott, 13 June 2017

 

In a study of 10 high-income countries with universal health care, including the United Kingdom, costs for prescription drugs in 6 of the largest categories of primary care medicines varied by more than 600%, according to research published in Canadian Medical Association Journal (CMAJ). Researchers focused on 6 categories of widely used primary care drugs usually purchased at retail pharmacies rather than hospital pharmacies. In the 5 countries with universal, single-payer coverage of prescription medications, the average per-person cost was $77. Average costs were $99 in the 4 countries with universal social insurance for prescription drugs and $158 in Canada, which has a mixed system of private and public financing.

 

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Supplying for tomorrow’s needs

Pharma Times, Katrina Megget, June 2017

 

The pharmaceutical supply chain is facing both challenges and opportunities as the industry enters a new healthcare era 26 PharmaTimes

 

The world is changing and so is pharma. From new, innovative products, and the focus on value and services, to a shift to more community and home-based healthcare, there’s a lot to consider. And in all of this, the supply chain is the often-forgotten player – indeed, much of pharma’s future success will come down to optimising the supply chain to meet these changing demands. “The pharmaceutical industry is entering a stage of great change, not only regarding the launch of new, innovative medicines and new distribution channels but also from an overall supply chain perspective,” says Professor Constantin Blome, professor of operations management at the University of Sussex, in a report on the topic. “Supply chains are increasingly stressed by demand variability and lower margins.”

 

In light of this, experts, such as Blome, are increasingly emphasising the need for pharma to rethink its supply chain. According to a PwC report, “most pharma have complex supply chains that are under-utilised, inefficient and ill-equipped to cope with the sort of products coming down the pipeline”. And according to fellow consultancy AT Kearney, 40 percent of pharma lack clearly defined systems to keep complexity in check. PwC says pharma has invested relatively little effort in reconfiguring their manufacturing and distribution operations to date, resulting in a supply chain that is neither flexible nor cost-effective. “Yet the supply chain is just as important,” the consultancy says. “It’s the link between the laboratory and the marketplace. Unfortunately, it’s a link that frequently doesn’t work very well.” PwC claims a “radical overhaul” is needed.

 

Of course, this is easier said than done. Blome notes the challenge of marrying reduced complexity with a geographically dispersed system that is, at the same time, both agile and dynamic, and still satisfies customers’ needs. Yet, PwC notes in its report that some companies have started to refine their supply chains. For instance, between 2004 and 2009, overall equipment effectiveness in packaging increased from 36 percent to 51 percent, while quality also improved, with the percentage of rejected batches falling from 1 percent to 0.74 percent over the same period. But PwC notes most measures are short-term sticking plasters to address immediate challenges like the rationalisation of larger manufacturing networks as a result of acquisitions. As a result, few companies have supply chains capable of meeting tomorrow’s needs.

 

New developments

 

Added into the mix are new developments that have the potential to further impact the pharmaceutical supply chain over the coming years. Blome and a team of researchers identified 12 such developments. The most impactful on the industry’s supply chain was the introduction of compliance and risk management measures, followed by expansion into emerging markets and the availability of detailed patient data. Other developments predicted to have an impact included the shift to patient centricity, integrating medical devices and healthcare services into the supply chain, incremental licensing and launching, and environmental pressures, among others.

 

Blome’s research reflects a 2014 survey by logistics firm UPS, which found that 60 percent of respondents cited regulatory compliance as a main concern for the supply chain, with 78 percent claiming this was a top trend driving supply chain changes. Some of the most pressing of these regulations impacting the supply chain are those around serialisation and track and trace requirements. For instance, the EU’s Falsified Medicines Directive, in a bid to help fight counterfeit and substandard medicines, requires strengthened record keeping and added authenticity features on packaging. While such anticounterfeiting measures will affect the supply chain process it will also improve visibility across the chain, which becomes increasingly important as supply chains stretch across more continents and often involve complex networks and outsourcing. “Companies will need to find effective measures to safeguard drugs and their operations by improving risk management and compliance mechanisms,” says Blome. In addition, the expansion into emerging markets heaps extra regulations and compliance pressures, while at the same time there may be weak infrastructure, poor distribution and poor quality control and monitoring, adds Blome. “Regulation in emerging markets needs to be carefully considered as many new policies are being introduced, yet there is a lack of careful monitoring to other parts of the world.” As a result, pharma companies will need to consider how to select the right supply partners, how to manage quality, product safety and delivery risks, and how to ensure intellectual property is appropriately protected, Blome says.

 

Besides the challenges geographic spread provides there are further distribution challenges and new routes to market that pharma will be forced to consider. Specifically, the shift away from hospitals and surgeries to healthcare delivered in the community and in the home will pose enormous challenges for pharmaceutical supply chains, Blome says. “Pharmaceutical companies will have to distribute their products to many more locations and even to patients’ homes.” UPS’ survey found that this fact was causing 21 percent of respondents to consider supply chain changes, while AT Kearney notes there is even doubt over the survival of the traditional pharma wholesale model. Furthermore, patient-centric healthcare is increasing, which will create a more demanddriven supply chain. And, indeed, according to a study by AT Kearney in 2014, 52 percent of respondents see a supply chain with greater customer centricity as a top priority.

 

Another change that will impact the supply chain will be the shift to live licensing (limited marketing contingent on safety and efficacy) and phased launches, says Blome. “Instead of large upfront investments into supply chains designed to cope with peak volumes, new product launches will require supply chains that can be rapidly adjusted as licenses change. Thus, in light of gradual licensing and adapted launching processes, pharmaceutical supply chains will have to reach new levels in agility and responsiveness and react to rapid changes.” This will not be straightforward, he warns, when regulatory and marketing processes differ in different regions.

 

Supply chain opportunities

 

But Blome also says the industry is well equipped to tackle these upcoming challenges, believing there are many developments that will also create opportunities for the industry. For instance, detailed patient data can have a positive effect on the supply chain. If this is collected in real time, Blome says, it will enable pharma companies to gather targeted information that can be fed back into the supply chain, which allows for higher efficiency and more precise demand forecasting, which is essential for keeping inventories low. Indeed, he adds, access to patient data may start a revolution in inventory management as it has the potential to prevent shortages and expensive emergency orders. “Moreover, such data will help companies to build demand-driven supply chains in which healthcare packages for different patients are assembled at ‘super hubs’ before being delivered to their homes,” he notes.

 

Emerging technologies pose another opportunity for pharma’s supply chain, which may help to manage and streamline it, as well as adding the flexibility and responsiveness that is needed. Blome points to e-devices and the internet of things as examples. The PwC report states: “Timely access to various emerging technologies will help pharma companies manufacture and distribute its products more efficiently. Some of these technologies will enable it to build quality into its manufacturing processes, while others will enhance its throughput or facilitate collaboration to realise economies of scale.” For instance, the development of oral biologics will eliminate the need for cold chain distribution for these therapies, computational modelling will enable pharma to design and validate manufacturing processes virtually using Quality by Design (QbD) principles, while advanced tracking technologies will enable the monitoring of products from factory to patient and allow end-to-end visibility of performance.

 

Collaboration, too, is a word that is circulating as a solution to the supply chain challenges pharma is facing. This may involve a more outsourced model – becoming virtual manufacturers – or one based on partnership with other companies, such as sharing manufacturing and distribution resources. The focus, however, will be on developing a more agile, flexible and compliant supply chain in line with demand forecasts, Blome says. PwC predicts that pharma, device companies, healthcare services and care pathways will integrate, which will provide more end-to-end visibility, more accurate demand forecasting, and improved costeffectiveness. This will also allow the development and supply of integrated product-service packages, critical in the outcomes era, PwC says.

 

Embracing a more collaborative approach is not without its concerns, however. Virtual manufacturing, for instance, touches on issues of supply integrity, quality and compliance, as well as increased complexity, notes the PwC report. “But any company that decides to operate a virtual supply chain will still have to maintain sufficient in-house expertise to choose the right partners and monitor them constantly” and “ensure they have access to realtime data from every stakeholder”, the consultancy adds.

 

As the industry and the healthcare environment changes and pharma enters a new era, more focus will be placed on the supply chain and how it can meet the new demands. Making changes will be inevitable, says Blome. “Making the right decisions that are sustainable in regards to strategic supply chain management and the design of global supply chains is more important than ever,” he adds, “as it will distinguish companies that lead from those that lag behind in terms of both their profitability and overall success”.

 

Drug costs vary by more than 600% in study of 10 high-income countries

European Pharmaceutical Review, Niamh Marriott, 13 June 2017

 

In a study of 10 high-income countries with universal health care, costs for prescription drugs in 6 of the largest categories of primary care medicines varied by more than 600%, according to research published in CMAJ (Canadian Medical Association Journal).

 

All countries except Canada offered universal coverage of outpatient prescription drugs.

 

Countries included

 

The study looked at data on the volume and daily cost of primary care prescriptions in 10 high-income countries with universal health care: Australia, Canada, France, Germany, the Netherlands, New Zealand, Norway, Sweden, Switzerland and the United Kingdom. Because of the high cost of pharmaceutical drugs and the lack of universal health care, the United States was not included.

 

Retail costs

 

Researchers focused on 6 categories of widely used primary care drugs usually purchased at retail pharmacies rather than hospital pharmacies. These included hypertension treatments, pain medications (nonsteroidal anti-inflammatory drugs as well as opioids), cholesterol-lowering drugs, noninsulin diabetes treatments, gastrointestinal medications and antidepressants. They measured frequency of use of the medications by average number of days of therapy purchased per capita.

 

Medications for treating high blood pressure accounted for the largest number of days of therapy in all countries.

 

In the 5 countries with universal, single-payer coverage of prescription medications, the average per-person cost was $77. Average costs were $99 in the 4 countries with universal social insurance for prescription drugs and $158 in Canada, which has a mixed system of private and public financing. Higher costs of drugs and the mix of therapies chosen accounted for most of the cost differences between countries.

 

“The volume of therapy purchased in Canada was about the same as that in the comparator countries; however, Canadians spent an estimated $2.3 billion more than they would have in 2015 if these primary care treatments had had the same average cost per day in Canada as in the 9 comparator countries combined,” writes Dr Steven Morgan, School of Population and Public Health, University of British Columbia, with coauthors.

 

“Average expenditures are lower among single-payer financing systems, which appear to promote lower prices and selection of lower-cost treatment options within therapeutic categories,” the study authors conclude.

Media Summary

EC calls on UK pharma firms to review drug authorisation before Brexit
M2 Pharma, 4 May 2017

The European Commission (EC) has called on UK pharmaceutical firms to examine how Brexit will impact their drugs. It comes as the EC reiterated its laws, namely, the regulation that requires medicines authorisation holders have a base in a member state or EEA country in order to supply their products. The Commission and the European Medicines Agency (EMA) jointly warned that firms not “established in the EU” or conducting batch release and pharmacovigilance in the EU would likely face disruption once Britain leaves in March 2019.

How drugmakers face global push-back on high prices
Ben Hirschler, Reuters, 4 May 2017

Pharmaceutical companies are coming under fire globally as new treatments for cancer and other serious conditions reach the market at ever-rising prices – a trend which looks set to increase. The debate on drug pricing will next week move to Amsterdam as the Dutch government hosts a forum for World Health Organization (WHO) member states to promote “fair pricing”. In Europe, Germany’s tough price negotiators have caused some firms to pull drugs off the market rather than accept price cuts, while Britain last month introduced new budget curbs on expensive products.

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EC calls on UK pharma firms to review drug authorisation before Brexit
M2 Pharma, 4 May 2017

The European Commission (EC) has called on UK pharmaceutical firms to examine how Brexit will impact their drugs. It comes as the EC reiterated its laws, namely, the regulation that requires authorisation holders have a base in a member state or EEA country, In-Pharma Technologist reported on Thursday.

The Commission and the European Medicines Agency (EMA) jointly warned that firms not “established in the EU” or conducting batch release and pharmacovigilance in the Union would likely face disruption once Britain leaves in March 2019.

The Commission commented: “Marketing authorisation holders may be required to adapt processes and to consider changes to the terms of the marketing authorisation in order to ensure its continuous validity and exploitation, once the United Kingdom has left the Union.”

This call may prove a challenge given that little is known or agreed upon as to what Brexit will mean or how severe it will be. Nonetheless, the Commission called on companies to screen marketing authorisations and pinpoint those that need to be changed.

The Commission emphasised that firms should do so quickly to “avoid any impact on the continuous supply of medicines for human and veterinary use within the European Union.”

How drugmakers face global push-back on high prices
Ben Hirschler, Reuters, 4 May 2017

Pharmaceutical companies are under fire around the world as a wave of new treatments for cancer and other serious conditions reach the market at ever rising prices, and the pressure looks set to increase.

Next week the debate on drug pricing – a particularly heated topic in the United States – will move to Amsterdam as the Dutch government hosts a forum for World Health Organization (WHO) member states to promote “fair pricing”.

After Donald Trump earlier this year accused drugmakers of “getting away with murder”, shortly before he was inaugurated as U.S. president, the May 11 event underscores the focus on medicine pricing in health ministries from Berlin to Beijing.

In Europe, Germany’s tough price negotiators have caused some firms to pull drugs off the market rather than accept price cuts, while Britain last month introduced new budget curbs on pricey products.

China and Japan, the two biggest non-Western markets for pharmaceuticals, are also bearing down on costs, and poorer countries find new drugs costing tens of thousands of dollars are simply out of reach, even with preferential pricing deals.

“It’s great that we have these treatments but we need to find a way to make them more affordable,” Andrew Rintoul, the WHO health economist organizing the drug pricing forum, told Reuters.

Drugmakers know they must up their game to save their reputation – even as patients cheer the scientific advances behind their new products – and the industry is fighting to defend its corner more vigorously than ever.

A major advertising campaign by the U.S. Pharmaceutical Research and Manufacturers of America trade group, for example, includes accusations that insurers are failing to pass on the benefits of discounts negotiated with manufacturers.

This goes to the heart of a thorny issue. On the surface, the cost of medicines may be rising steeply but the picture is distorted by off-invoice discounts and rebates, which in the United States average around 30 percent, according to healthcare information firm QuintilesIMS.

In Europe, such rebates amount to roughly 17 percent.

“I personally don’t believe in the talk of drug expenditure breaking the system,” Thomas Cueni, who recently took over as director-general of the International Federation of Pharmaceutical Manufacturers and Associations, told Reuters. “When you look at the aggregate numbers, drug spending has been pretty stable in most OECD countries at around 10 to 15 percent of healthcare spending.”

MORE DISCLOSURE

Still, the lack of price transparency is a major bugbear for policy experts like the WHO’s Rintoul, who previously negotiated on pharmaceutical prices for the Australian government.

Public sector officials see the obscurity surrounding prices as a big obstacle in efforts to negotiate effectively with pharmaceutical companies. There are also growing calls for greater disclosure on companies’ R&D and production costs.

Transparency will be high on the agenda in Amsterdam, mirroring efforts by some U.S. states to shine a light on costs. Vermont last year became the first such state to demand that companies justify drug price hikes by detailing factors behind the increase.

Companies, however, are reluctant to specify exactly how they come up with drug prices and prefer to stress the value that their medicines bring to patients and society.

“The industry has to stand up and argue its value proposition,” said Cueni, who admits he is “apprehensive” about the tone of the WHO meeting. “I’m not a big fan of this term ‘fairness’ because, let’s face it, fairness is in the eye of the beholder. There’s no objective definition.”

Drugmakers like Novartis (NOVN.S) and Takeda Pharmaceutical (4502.T), which recently joined with the World Economic Forum to pilot schemes that will pay for drugs based on how well they work, would much rather the focus was on outcomes.

But an expensive medicine that may be cost-effective, based on a particular methodology, can still prove to be unaffordable within limited national healthcare budgets. That has been the experience in many countries recently with highly effective new hepatitis C drugs from Gilead (GILD.O) and others.

At the other end of the spectrum, the WHO meeting will also try to address the problem of shortages of some off-patent generic medicines, which should be cheap in principle but can hit supply problems if prices fall to unsustainably low levels.

As well as tackling expensive drugs, some experts therefore believe minimum prices may be needed to keep certain vital products on the market.

Media Summary

United Kingdom’s withdrawal from the European Union
The European Medicines Agency, 3 May 2017

The European Medicines Agency (EMA) and the European Commission have published a notice to marketing authorisation holders of centrally authorised medicines to remind them of their legal obligations in preparation for Brexit. Discussions have been initiated with the national competent authorities on how work related to the evaluation and monitoring of medicines will be shared between Member States. This is currently based on a scenario foreseeing that the UK will no longer participate in the work of EMA and the European medicines regulatory network as of 30th March 2019. The EMA announcement can be found here.

Medical Devices and CE Marking and the Impact of Brexit
Institution of Mechanical Engineers, 3 May 2017

The Institution of Mechanical Engineers have urged British Brexit negotiators to settle parallel policies for device approvals. They also urged the industry and NHS to maintain their influence over EU devices regulations. The report highlights the challenge of extricating the UK from the EU without the Medical Technology industry suffering. Recommendations include negotiating a Med Tech compliancy arrangement with the EU to ensure continuity in the Conformité Européene (CE) marking process for UK manufacturers, and removing the current funding imbalance between early-stage start-ups and large established companies in order to support research and innovation in the UK.

New legislation passed to prevent excessive price hiking of generic drugs
The Pharmaceutical Journal, 3 May 2017

A new law which aims to bring stricter price control to unbranded generic drugs has received Royal Assent in the House of Commons. The Health Service Medical Supplies (Costs) Act gives the UK Government the power to instruct pharmaceutical companies to reduce the price of a generic medicine or introduce other controls on their branded products in cases where it thinks drug companies are charging “unreasonable” prices for generics. Manufacturers could face financial penalties if they fail to comply with the new law.

Report illicit drug harms: Pilot reporting site set up in response to soaring illicit drug use
Dispensing Doctor, Alisa Colquhoun, 4 May 2017

Public Health England is piloting a Yellow Card-type scheme for reporting adverse effects associated with illicit drugs. The site enables healthcare professionals to report illicit drug reactions (RIDR) and aims to collect data on the acute and long-term harm to health associated with the use of the drugs and potential interaction with licensed medicines. The reporting site will be available until mid-March 2018. Suspected interactions between licensed medicines and illicit drugs should also be reported via the Yellow Card scheme

Parliamentary Coverage

There is no Parliamentary Coverage.

Full Coverage

United Kingdom’s withdrawal from the European Union
The European Medicines Agency, 3 May 2017

On 29 March 2017, the United Kingdom (UK) notified the European Council of its intention to withdraw from the European Union (EU). The implications of Brexit for the European Medicines Agency’s (EMA) location and operations depend on the future relationship between the UK and the EU, which is unknown at present.

No Member State has previously decided to leave the EU, so there is no precedent for this situation.

The Agency is in close contact with the EU institutions and national competent authorities in the EU Member States. EMA will share information on the latest developments with its stakeholders.

EMA’s ongoing mission

The Agency, its 890 employees and all the European experts contributing to EMA’s work will continue to focus on EMA’s mission to protect human and animal health and ensure access to medicines that are safe, effective and of good quality.
EMA’s procedures are not affected by Brexit. The Agency will continue its operations, in accordance with the timelines set by its rules and regulations.

The European medicines regulatory network as a whole is a very strong and flexible system that is able to adapt to changes without jeopardising the quality and effectiveness of its work.

Regulatory preparedness (new)

On 2 May 2017, EMA and the European Commission published a notice to marketing authorisation holders of centrally authorised medicines intended to remind them of their legal obligations in preparation for Brexit:

Notice to marketing authorisation holders of centrally authorised medicinal products for human and veterinary use

In April 2017, EMA initiated discussions with the national competent authorities on how work related to the evaluation and monitoring of medicines will be shared between Member States in view of the UK’s withdrawal from the EU.

This is currently based on a scenario that foresees that the UK will no longer participate in the work of EMA and the European medicines regulatory network as of 30 March 2019.

Decision on EMA’s location

The location of the Agency after Brexit will depend on the future relationship between the UK and the EU, which is unknown at present. Representatives of the Member States will determine the Agency’s location by common agreement.
EMA welcomes the interest expressed by some Member States in hosting the Agency in future.

EMA is confident that the Member States will make the most appropriate decision on the Agency’s location and arrangements, taking the complex political and legal environment into account.

New legislation passed to prevent excessive price hiking of generic drugs
The Pharmaceutical Journal, 3 May 2017

A new law which aims to bring tougher price control to unbranded generic drugs received Royal Assent in the House of Commons on 27 April 2017.

The Health Service Medical Supplies (Costs) Act gives the government the power to instruct pharmaceutical companies to reduce the price of a generic medicine or introduce other controls on their branded products in cases where it thinks drug companies are charging “unreasonable” prices for generics.

Manufacturers could face financial penalties if they fail to comply with the new law.

The government has traditionally relied on the market to keep generic costs down but in cases where there is no competition, prices have been hiked, according to the Department of Health briefing paper on the new legislation.

The intention is for the department to work with industry representatives and the Competition and Markets Authority to determine when a price is “unreasonably high”. The new legislation will also give the government more powers to collect information about the sale of drugs.

The Health Service Medical Supplies (Costs) Act was among a raft of bills which were granted Royal Assent on 27 April, before the dissolution of Parliament on 3 May 2017 ahead of the 8 June 2017 UK general election.

Report illicit drug harms: Pilot reporting site set up in response to soaring illicit drug use
Dispensing Doctor, Alisa Colquhoun, 4 May 2017

Public Health England is piloting a Yellow Card-type scheme for reporting adverse effects associated with legal highs and other illicit drugs.

The site enables healthcare professionals to report illicit drug reactions (RIDR) and aims to collect more detail on the acute and long-term harm to health associated with the use of the drugs and potential interaction with licensed medicines.

NHS Digital reports that hospital admissions for poisoning by illicit drugs are up by more than 50 per cent in a decade. Illicit drug use is said to be particularly prevalent in rural areas.

The reporting site will be available until mid-March 2018.

Suspected interactions between licensed medicines and illicit drugs should also be reported via the Yellow Card scheme.
The website also details where healthcare professionals can find out more information about legal highs.

Media Summary

If Trump wants to bring down US drug prices, he’ll borrow this tactic from the UK
Quartz, Oliver Staley, 29 March 2017

As attempts at repealing Obamacare currently appear to be thwarted, US president Donald Trump can still tackle the soaring costs of healthcare by addressing one of its biggest problems — the high cost of prescription drugs. Oliver Staley in Quartz suggests that, if Trump does indeed want to tackle rising drug prices, he could look at the UK’s cost-benefit analysis conducted by the National Institute of Cost Effectiveness (NICE). Things may be starting to change as US insurance companies are beginning to discuss value-based pricing for drugs. However, until Medicare and Medicaid start demanding that drugs be priced according to their effectiveness, US drug prices are likely to continue rising.

Pharmacy margins under the spotlight in court: PSNC’s challenge to funding cuts turns to profitability
Dispensing Doctor, Ailsa Colquhoun, 30 March 2017

Pharmacy operating margins have come under scrutiny during pharmacy’s legal challenge to funding cuts; the two cases brought by PSNC and the NPA were heard between March 21 to March 23. David Locke QC representing the NPA said the secretary of state had failed to have a proper understanding of the inequality of health outcomes. A judgment is not expected before mid-April.

Parliamentary Coverage

There is no Parliamentary Covarge.

Full Coverage

If Trump wants to bring down US drug prices, he’ll borrow this tactic from the UK
Quartz, Oliver Staley, 29 March 2017

While attempts at repealing Obamacare appear dead (at least for the foreseeable future), US president Donald Trump still has an opportunity to tackle the soaring costs of American-style healthcare by addressing one of its biggest problems—the high cost of prescription drugs.

The US spent $3.2 trillion on healthcare in 2015—almost a fifth of its total GDP—and 10% was on prescription drugs. That comes to more than $1,000 per person, per year. Drug prices have climbed at about 10% annually, and will continue to climb as more sophisticated treatments for cancer and heart disease are introduced. One cutting-edge treatments for melanoma, for example, now costs $256,000 a year (paywall).

Trump has loudly and often proclaimed his outrage over this. He convened the CEOs of the largest pharmaceutical companies in January, and more recently, said he wants the Medicare, the federal insurance program for seniors, to negotiate the cost of drugs, which is now forbidden by law. Drug stocks quake when he raises the subject, but they recover because no plan has been proposed.

If Trump truly wants to bend the arc of rising drug prices, he might want to look at how it’s done in the UK.

In England, the National Health Service, the government agency which provides mostly free healthcare to 65 million people, spends about $391 per person (pdf)—around two-fifths of per-capita US spending. Prescription drugs there cost three times less than in the US. Putting aside the issue of whether it’s cheaper for the US to simply adopt universal healthcare, one way the NHS does this is by negotiating down the cost of of some drugs, and simply refusing to buy others.

Once drugs are deemed safe and effective, they’re subject to a cost-benefit analysis by the UK’s National Institute of Cost Effectiveness (NICE). NICE determines whether the drugs are actually worth the money, and whether they should be bought by the NHS. Since the government buys the overwhelming majority of drugs in the UK, NICE’s recommendations—and the fear of a rejection—are hugely influential.
It’s not an empty threat: The agency turns down about a fifth of the drugs and treatments it evaluates.

When analyzing drugs, the agency considers the cost of extending a patient’s life for a year, adjusted for the quality of that additional year, and compares it to the next best alternative. Generally, NICE won’t approve drugs that cost more than £20-30,000 ($25-38,000) per quality-adjusted “life year” than the next best alternative. The US has a far higher appetite for cost: according to one analysis, the average difference for renal dialysis, for example, and the next best option to treat kidney failure is $129,000.

A NICE rejection can also serve to open negotiations.

For example, in 2015, the agency said the almost $5,000 per month cost of Lynparza, a new drug for certain types of ovarian cancer, would cost as much as £66,500 for the benefit it provided compared to existing treatments. After discussions, Lynparza’s manufacturer, AstraZeneca,agreed to both lower the price by an undisclosed amount, and pay for the cost of the drug if a patient remains on it after 15 months.

In the US, the Food and Drug Administration has the mandate of ensuring drugs are first safe, then effective, but is silent about whether the drugs it approves are worth the money. Medicare and Medicaid, the biggest buyers of drugs in the US, can’t ask, either. Pharmacy-benefit managers, like Express Scripts and CVS, which administer prescription plans for private insurers, can refuse to add drugs to their lists of approved medications, but are subject to the pressures of both pharma companies and customers.

Things may be starting to change, though. US insurance companies are beginning to discuss value-based pricing for drugs, and an association of cancer doctors now recommends oncologists weigh a drug’s cost when prescribing. But until Medicare and Medicaid start demanding that drugs be priced according to their effectiveness, US drug prices are likely to continue climbing.

Pharmacy margins under the spotlight in court: PSNC’s challenge to funding cuts turns to profitability
Dispensing Doctor, Ailsa Colquhoun, 30 March 2017

Pharmacy operating margins have come under scrutiny during pharmacy’s legal challenge of the funding cuts announced during the DDA 2016 annual conference and imposed from December.

Representing England’s pharmacy contract negotiator PSNC, Alison Foster QC revealed that the Department of Health had based its decision on pharmacy funding on a working operating margin figure of between 10 and 15 per cent.

The court heard that the 10 per cent estimate came  from one person described as an ‘Industry Insider’ whose information had been destroyed after the meeting with DH officials; and the 15 per cent from an analysis of Companies House data, 2015. This figure has since been discredited by accountancy firm PwC, which has suggested a 6 per cent operating margin.

The hearing of the Judicial Review cases relating to the changes imposed on community pharmacy on October 20 2016 has now concluded.

The two cases brought by PSNC and the NPA were heard between March 21 to March 23.

PSNC was granted permission for the Judicial Review from the High Court in December last year. PSNC’s case alleged that the Secretary of State failed to carry out a lawful consultation on the proposals for community pharmacy.

The NPA’s case was focused on arguments that the Secretary of State failed to properly discharge his Public Sector Equality Duties and failed to appreciate community pharmacy’s wider healthcare role.

In her submissions, PSNC’s QC Alison Foster made the following points about the Department of Health’s approach to negotiations with pharmacy:

Failure to use the cost of service inquiry 2011 and increasing costs for community pharmacies in its discussions

The narrow and technical function of the Drug Tariff to ensure fair and reasonable remuneration, rather than to enable a re-shaping of the community pharmacy market.

Failings in the process which make the consultation unlawful

Impact on private individuals’ livelihoods, family businesses and mortgages on homes

Unfair impact from and unprecedented nature of the cuts

Comprehensive reshaping of the markets

Going through the information disclosed by DH, Alison Foster indicated that there were references to incentivised use of internet pharmacies and amazon style deliveries.

David Locke QC representing the NPA said the secretary of state had failed to have a proper understanding of the inequality of health outcomes – which was more than simply access to pharmacies; the imposed decision would increase health inequality in urban areas: the funding cuts would hit urban pharmacies the hardest which had the least protection from the Pharmacy Access Scheme.

James Eadie QC representing the Secretary of State, put forward the its arguments that sufficient evidence had been provided to PSNC to enable it to respond to the consultation and that there had been sufficient time for PSNC to respond.

A judgment is not expected before mid-April.

Big pharma braces for further bruising publicity over drug prices

Financial Times, David Crow, 18 December 2016

 

The Financial Times reports on the issue of high drug prices in the US. Theoretically, the pharma industry was relieved by the election of Donald Trump over fears that Hilary Clinton would implement strict policies to curb the cost of medicines. However, this approach could be short-sighted and the issue of drug prices remains high on the agenda with increasing public scrutiny expected in 2017.  Brent Saunders, chief executive of Allergan, the first company to publish a “social contract” with patients, urges the industry to self-regulate.

 

Wholesalers’ Christmas delivery information

DDA, Ailsa Colquhoun, 20 December 2016

 

The three mainline wholesalers have supplied their Christmas delivery information. Please download the information you require to ensure your supplies to patients.

 

AAH

England, Wales and NI

Scotland

Alliance Healthcare

All

Phoenix

England Wales & NI

Scotland

 

December concessionary prices announced

Chemist and Druggist, Thomas Cox, 20 December 2016

 

The Department of Health and National Assembly for Wales have agreed concessionary prices for the following items for December 2016 prescriptions.

 

Drug  Strength Form Price
Amitriptyline 50mg tablets (28) £3.05
Bumetanide 1mg tablets (28) £1.75
Candesartan 2mg tablets (7) £2.25
Dapsone 50mg tablets (28) £46.19
Exemestane 25mg tablets (30) £9.60
Flecainide 50mg tablets (60) £11.25
Fludroxycortide 4mcg/sg tape 7.5cm (20) £12.49
Lorazepam 1mg tablets (28) £6.05
Lorazepam 2.5mg tablets (28) £12.50
Metronidazole 400mg tablets (21) £7.88
Mirtazapine 15mg tablets (28) £5.95
Mirtazapine 30mg tablets (28) £1.55
Mirtazapine 45mg tablets (28) £5.95
Naratriptan 2.5mg tablets (6) £24.55
Nitrofurantoin 100mg tablets (28) £14.05
Nitrofurantoin 50mg tablets (28) £17.50
Quinagolide 75mcg tablets (30) £49.50
Ropinirole 0.25mg tablets (12) £5.70
Ropinirole 0.5mg tablets (28) £18.15
Ropinirole 1mg tablets (84) £56.71
Ropinirole 2mg tablets (28) £31.51
Ropinirole 5mg tablets (84) £165.00
Valsartan 160mg capsules (28) £5.20
Valsartan 40mg capsules (28) £4.17
Valsartan 80mg capsules (28) £4.17
Zolmitriptan 2.5mg sugar-free
orodispersible tablets (6)
£23.99

 

 

Parliamentary Coverage

House of Commons Oral Answers, 20 December 2016, Community Pharmacies

 

Lyn Brown (West Ham) (Lab)

 

7. What steps his Department is taking to work with community pharmacies to reduce (a) waste and (b) the cost of medicines.

 

The Parliamentary Under-Secretary of State for Health (David Mowat)

NHS England has a range of initiatives for waste and medicine cost reduction. We estimate that there is a prize of up £150 million a year to be realised across the system on waste. Community pharmacies have a significant role to play in that, partly through their existing duty to review prescriptions when repeat dispensing and partly through the separately commissioned medicine use reviews.

 

Lyn Brown

The Minister is absolutely right to say that community pharmacies have an important role to play. On 17 October, he told the House:

“We do not believe that any community pharmacies will necessarily close as a result of these cuts.”—[Official Report, 17 October 2016; Vol. 615, c. 597.]

However, the impact assessment published by his Department just two days later described a possible scenario in which 1,000 pharmacies close. Will the Minister confirm that nobody in Britain will have to travel further to get to a chemist as a result of his cuts?

 

David Mowat

The impact assessment set out an upper range, which we do not believe represents an accurate reflection of what will happen. The facts of the matter are that we need our community pharmacy network to move towards services and away from dispensing. Paying every community pharmacy in the country, or 91% of them, £25,000 just for having an establishment does not achieve—[Interruption.]

 

Mr Speaker

Order. The hon. Member for West Ham (Lyn Brown) should not chunter from a sedentary position in an attempt to hector the Minister, who should glide seamlessly above the attempted provocation. Minister, continue.

 

David Mowat

The Minister has finished.

 

Mr Speaker

He has finished his answer. Very well; I call Alistair Burt.

 

Alistair Burt (North East Bedfordshire) (Con)

To ensure not only that unnecessary costs are reduced, but that the best community pharmacy services are provided, will the Minister do all that he can to make sure that clinical commissioning groups engage as effectively as possible with pharmacies? Preferably, that would be by getting more people on CCG boards to ensure that the crucial connection between the provision of health services and pharmacy is absolutely at the heart of what we do.

 

David Mowat

My right hon. Friend is right; CCGs are variable in the extent to which they commission pharmacy services. However, we have set out the minor ailments scheme, it will be rolled out nationally by April 2018 and we expect every CCG to take a part in it.

 

Sir Kevin Barron (Rother Valley) (Lab)

As chair of the all-party group on pharmacy, I have seen many examples of drugs that have been prescribed and not used, as I am sure we all have. Should we not renegotiate the national contract, which currently pays community pharmacies more than 90% of their income through prescribing? Surely we can do things differently.

 

David Mowat

The right hon. Gentleman rightly says that we must change the contract to move away from 90% of the income coming from dispensing. Far more must come from services, which are separately commissioned by CCGs and others. The Murray review, which he will be aware of from his work on the all-party group, sets out a road map for that, and NHS England is determined to implement it.

 

Mr Stewart Jackson (Peterborough) (Con)

May I pay tribute to the excellent work of pharmacies in my constituency? Last night, “Look East” demonstrated the pressure that urgent care centres in the east are under because of extra patient footfall. Will the Minister give me an undertaking that he will put in place guidelines to CCGs to encourage them to work much more closely with pharmacies to reduce that footfall?

 

David Mowat

My hon. Friend raises an important point, and he is right to say that we must move the community pharmacy network away from just dispensing and into services, which will include minor ailments and repeat prescriptions. I will be encouraging CCGs to do that.

 

Martyn Day (Linlithgow and East Falkirk) (SNP)

Community pharmacies, which were developed in Scotland 10 years ago, are there for minor ailment, chronic medication and public health services. Although the Minister has expressed admiration for the Scottish system, does he not recognise the need to work with the pharmacy profession to develop the full potential within community services?

 

David Mowat

I have mentioned on previous occasions that Scotland has, in some respects, gone further and faster than we have in England so far on community pharmacies. The £300 million that we have set aside in the integration fund for the rest of this Parliament is going to be used to do just the things that the hon. Gentleman has mentioned, in terms of minor ailments and repeat prescriptions. We are determined to make that happen.

 

Julie Cooper (Burnley) (Lab)

Over the festive period, in every town and city in the UK, community pharmacies will be open to dispense emergency prescriptions, and to provide specialist services and professional advice. Does the Minister appreciate that service, which not only helps the public, but takes pressure off other parts of the NHS? Will he join me in thanking community pharmacies and their staff for the work they do? Will he commit to reconsider budget cuts that will lead to a reduction of this valuable service, and instead meet the Royal Pharmaceutical Society and the National Pharmacy Association to discuss extending the role of community pharmacies, to deliver savings for the NHS?

 

David Mowat

I have met the royal college of pharmacies on a number of occasions, and indeed it has worked with us on the Murray review, which is an essential road map that sets out how we are going to move the community pharmacy network away from a remuneration model based just on dispensing and on to services as well. I agree with the hon. Lady that the 11,000 community pharmacies across the country all provide excellent services, and we expect that to continue.

 

Full Coverage

Big pharma braces for further bruising publicity over drug prices

Financial Times, David Crow, 18 December 2016

 

Pharmaceutical executives are steeling themselves for 2017 to be another year defined by public outcry over the price of drugs, even as some investors bask in Donald Trump’s election victory.

 

The issue of high drug prices was never far from the headlines during the presidential campaign and shareholders had feared a victorious Hillary Clinton would implement policies to curb the cost of medicines.

 

Price controls would have crimped industry profits in the US, the world’s largest and most profitable healthcare market: Mrs Clinton’s loss was pharma’s gain or so the theory went.

 

But some executives insist it is too soon for relief and many are predicting another 12 months of bruising publicity over the price of medicines.

 

“I don’t think this election changes a thing,” says Dr Steve Miller, chief medical officer of Express Scripts, a pharmacy benefits manager that negotiates drug prices on behalf of US employers and health insurers.

 

“Trump has been a populist — if a company does something irresponsible, I don’t think he’s going to stand on the sidelines,” adds Dr Miller. “It is premature for the industry to relax and celebrate because drug prices are still going to be an enormous issue next year.”

 

Mr Trump has pledged to lower the price of medicines. “I’m going to bring down drug prices,” he told Time earlier this month, as the magazine named him person of the year. “I don’t like what’s happened with drug prices.”

 

His comments knocked roughly 3 per cent off biotech stocks, but they recovered in the following days, in a sign that investors are relatively sanguine about the threat.

 

Brent Saunders, chief executive of Allergan, best known for its Botox wrinkle treatment, says Republican dominance in Washington augurs well for the sector because the party is less inclined to introduce new regulations.

 

But he warns it would be foolish for pharma companies to cling to the pricing policies that landed the industry with such a toxic reputation. “We shouldn’t make the mistake of believing they will allow egregious behaviour to continue.”

 

Rather, he urges rival executives to use Mr Trump’s victory as an opportunity to police themselves. “I think if we self-regulate and stop doing these big double-digit price increases, we will be in a much stronger position.”

 

In September, Allergan became the first company to publish what it called a social contract with its patients, pledging to refrain from raising prices more than once a year and to limit any increases to low, single-digit percentages.

 

Since then, others have followed suit. Novo Nordisk, the diabetes specialist, said it would not increase its prices by more than 10 per cent a year.

 

Last week, Eli Lilly launched a scheme to shield some diabetes patients from high prices. It said it would discount the list price of its insulins by up to 40 per cent for those who have to pay for drugs out of their own pocket.

 

The Eli Lilly scheme is designed to tackle a flaw in the way US drugs are priced.

 

Although list prices are continuing to rise sharply, pharmacy benefit managers have started to extract larger discounts and rebates, meaning the real price received by the manufacturer is lower.

 

In 2016, the list price of drugs rose by between 6 and 7 per cent, but net price inflation — after all the discounts were subtracted — was lower, at between 2 and 3 per cent, according to QuintilesIMS, the research group.

 

On the face of it, the market is functioning as it should. Pharmacy benefit managers amass big groups of patients — 85m in the case of Express Scripts — and use their clout to extract large savings from drug companies, which they pass on to their clients: employers and health insurers.

 

 

Theoretically, it should result in lower premiums for consumers.

 

But in fact it has resulted in much higher costs for patients because their “out-of-pocket” expense is still calculated using the list price, rather than the net price.

 

This is particularly hard on those without insurance who buy their medication with cash and those with “high-deductible” policies, who have to shell out thousands of dollars on medicines before their insurer picks up the burden.

 

An increasing number of Americans fall into this trap, either because they have bought cheaper policies on the Obamacare exchanges or because their employers have switched them to less generous plans to save costs.

 

Ronny Gal, analyst at Bernstein, estimates that roughly 50 per cent of US patients will be exposed to a high-deductible plan in 2017.

 

Most high-deductible plans have a set amount — $5,000, for instance — that a patient must pay for medicines before their insurance kicks in. In the majority of cases the threshold is reset in January, meaning many families are about to see a big spike in their drug costs.

 

Soaring family bills will only deepen anger against the drugs industry, and politicians and reporters are ready to pounce on any egregious examples.

 

“With the media’s attention on this topic primed from 2016, [a pharma company] will likely end up in the wood-chipper,” predicts Mr Gal.

 

The potential time-bomb explains the trickle of drugmakers putting policies in place to defend themselves against accusations of price gouging.

 

Yet there is disagreement within the industry over whether specific policies and promises are the best way to deal with the debate over pricing. Merck, the third-largest US drugmaker by market value, has declined to publish its own pledge.

 

“We’ve had a very disciplined approach to pricing for years,” says Ken Frazier, chief executive of Merck. “We haven’t decided to come out with a big PR blitz. I think actions speak louder than words in this area and Merck has a track record of trying to be a responsible company.”

 

Mr Frazier wants to shift the focus from the price of drugs to the ballooning cost of healthcare in general. He cites Keytruda, his company’s revolutionary “immunotherapy” drug, which can significantly extend the lives of some of the sickest cancer patients. It costs roughly $150,000 a year.

 

“If you take a 45-year-old diagnosed with lung cancer, how much is that going to cost society from that point until a person dies?” he asks, pointing to the huge expenses associated with hospitalisation and end-of-life care.

 

“It’s going to be a lot more than this drug,” he says.

 

Generic drug prices under the microscope

 

The best tonic for the soaring price of prescription medicines is generic drugs. When a branded medicine loses patent protection, cheaper copycat versions are supposed to flood the market and reduce the price of a pill to just a few pennies.

 

However, drugmakers are facing accusations that they are manipulating the generics market to keep prices artificially high. On Friday, Actavis was accused of charging the NHS “excessive” price increases for generic hydrocortisone tablets.

 

The UK Competition and Markets Authority said the company, owned by Teva, the world’s largest generic drugmaker by volume, had raised the price of the tablets by more than 12,000 per cent since 2008, from 70p to £88.

 

It comes just a week after Pfizer was fined a record £84m for charging excessive prices for a drug to treat epilepsy. As with Actavis, the CMA said Pfizer had exploited a loophole for generic treatments, which are not subject to price regulation in the UK.

 

In the US, the majority of generic drugmakers are co-operating with a federal investigation into whether they colluded to keep prices high. Last week, the first criminal charges were brought against former executives at a relatively small drugmaker, Heritage Pharmaceuticals.

 

Larger names, such as Teva and Mylan, are still co-operating with the antitrust probe. And last week 20 states filed a lawsuit accusing Teva and Mylan — and four other generic drugmakers — of illegally fixing prices.

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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