Health Service Medical Supplies (Costs) Bill

Debate between Lord Hunt of Kings Heath and Baroness Masham of Ilton

Ping Pong (Hansard): House of Lords
Wednesday 26th April 2017 Lords Chamber

[Baroness Masham of Ilton (CB)]

My Lords, I congratulate the Minister on his hard work on the Bill and his helpfulness. I have one question. As this is a global matter, how can the Government assure us that the prices of drugs will come down?

[Lord Hunt of Kings Heath (Lab)]

My Lords, I look forward to the Minister’s answer to that last question. From the opposition Benches, I very much welcome the agreed amendment that has come forward from the Government today. It is good to see how wash-up can concentrate minds no end, and we have reached a very satisfactory outcome. I am very grateful to the Minister and his officials for their co-operation on this.

The Opposition have been in no doubt whatever that it is absolutely right to take action against those companies that have clearly been abusing the system. We should also pay tribute to the Times newspaper for its campaign, which has opened up some transparency in a pretty murky area.

There are two key issues that need to be taken forward. First, the key message of debates in your Lordships’ House is that, in seeking to deal with this particular problem, we must not underestimate the contribution of the pharmaceutical industry to this country, to the economy and to the life sciences sector. We have a problem in that we are incredibly innovative in the number of new drugs that are developed in this country, but the NHS is finding it increasingly difficult to invest in them and patients are not getting the benefit.

The second is the whole question of balance between the statutory and voluntary schemes—the noble Lord, Lord Lansley, referred to this. I have reached the conclusion that the current arrangements are simply not up to scratch in relation to how government should negotiate with the industry in the future. The patent lack of transparency about the real price paid by the NHS for individual drugs means, in my view, that the arrangements are no longer fit for purpose. I hope that the Government—whichever Government are in power post election—will look afresh at the need for new arrangements in negotiation which get a fair price and also lead to the adoption of innovative new drugs for NHS patients.

Can the Minister say when he thinks the Government will be in a position to implement the key provisions in this Bill in relation to prices?

Health Service Medical Supplies (Costs) Bill

Debate between Lord Hunt of Kings Heath and Baroness Masham of Ilton

Wednesday 5th April 2017 Lords Chamber

[Baroness Masham of Ilton (CB)]

My Lords, I am all in favour of bringing down the price of drugs where possible, but patients’ access to new drugs is very important. For a long time, NICE has been very slow to approve drugs and that has caused great frustration for patients and the industry. What can the Minister do about orphan drugs? Not having them can be life-threatening for patients, but NICE has taken some of these drugs off the list. That is really serious for patients for whom they are a lifeline. Does Scotland not have a better system?

[Lord Hunt of Kings Heath (Lab)]

Well, that’s a question, my Lords. First, I declare an interest as president of the Health Care Supply Association and of GS1, the barcoding organisation.

I support the Motion in the name of the noble Lord, Lord Warner. I note what the noble Lord, Lord Lansley, says—that it is not a remedy for the problem being described—but it would send a powerful message to the Government. It is a message which, judging by the debate in the Commons on this matter, I am afraid Ministers in the Commons have not really heard, although I acknowledge that in his opening remarks today the Minister certainly turned to the crux of the issue.

Essentially, with a Bill that gives the Government huge power over drug prices—indeed, it gives them absolute power—the real concern is that NHS patients will not get access to new medicines as they would in other countries. This in turn puts at risk investment in R&D by the pharmaceutical industry in this country, which in turn threatens to undermine the life sciences sector. It is one of the most crucial sectors in this country and in our economy, and post Brexit must become even more important. Essentially, we are seeking to turn this into a virtuous circle whereby the NHS is seen to want to invest in new medicines and treatments, industry feels that the UK is therefore a good place in which to invest, and our life sciences sector grows and becomes even more important.

The problem is that over the last few years we have seen increasing rationing or restrictions on access to these new and effective drugs. We have had a short debate on NICE. I was the Minister first in charge of NICE, going back some years now. When it was set up, it was, first, deemed to be wholly independent of the NHS in its judgments, and secondly, designed to speed up access to new technologies and medicines. However, in the past few years the remit has changed. It seems to have been pushed almost into part of NHS management and budgetary control. The noble Lord, Lord Lansley, put his finger on it when he said that after NICE has reached a judgment that a medicine is both clinically and cost effective, NHS England has, in a number of ways, sought to put in additional controls. That is why there is concern about the new proposal: that if a NICE-approved treatment exceeds or is expected to exceed a cost of £20 million in any of the first three years, NHS England could ask for a longer period for its introduction. The Minister said that the budget impact test, as it has come to be known, is not a cap but a negotiating tactic. I understand that, but I put it to him that in the past few years NHS England has shown neither the willingness nor the capacity to do anything but reduce access for patients. It is very difficult not to see this as another hurdle.

Health Service Medical Supplies (Costs) Bill

Debate between Lord Hunt of Kings Heath and Baroness Masham of Ilton

Committee: 1st sitting (Hansard): House of Lords
Monday 23rd January 2017 Grand Committee

[Baroness Masham of Ilton (CB)]

My Lords, cost-effective medicines which work for patients are vital, but some orphan drugs will cost more. Why are there differences in the pricing of drugs in Scotland and England? Someone must be making a lot of money.

[Lord Hunt of Kings Heath (Lab)]

My Lords, that is a very interesting question. The exchange between the noble Lords, Lord Lansley and Lord Warner, has been very helpful in focusing on the full intent of the amendment. As it is the first day of Committee, I remind noble Lords of my presidency of the Health Care Supply Association and GS1, the barcoding association.

The amendment is essentially about the life sciences sector and the relationship to it of the pharmaceutical and medical devices and technology industry. However, inevitably, as the noble Lord, Lord Lansley, has shown, it is very difficult not to talk also about issues to do with PPRS and access, and I suspect that those other issues will be dipped into in a number of debates.

First, let me say that the Opposition are strongly in favour of closing the loophole that the core part of the Bill attempts to do. We clearly want to see the NHS get value for money and a good deal out of price negotiations with the different parts of industry it deals with in relation to the matters covered by the Bill. My noble friend Lord Young asked some very pertinent questions. The Minister in passing raised the issue of clinical pharmacology. This is a clinical profession that most clearly enables the health services and, indeed, Ministers to understand the true cost effectiveness and value of new medicines.

The UK is a world leader in clinical pharmacology but, because decisions about the appointment of clinical pharmacologists are made by the NHS, we are at risk of losing the whole profession. I was very disappointed that Health Education England proposed to reduce the number of training posts in its most recent consultation. We were very pleased to have a meeting with the Minister’s predecessor, the noble Lord, Lord Prior, on this, and I very much hope that the Government will be prepared to have a look at it.

This debate is about the contribution of the life sciences sector to this country. Briefly reading the consultation passed today on the industrial strategy I noticed that the introduction talks about the UK benefitting from an,

“open economy: pro-competition rules, flexible labour markets, less intrusive regulation”.

The question that one really wants to put, particularly as this is a sort of declaratory amendment is, if that is so, if—as the noble Lord, Lord Lansley, has suggested—the issue of life sciences post Brexit deserves a great deal of consideration, why have the Government brought what is clearly an overbearing regulatory Bill to your Lordships’ House? If ever I have seen an example of gold plating, this is it. We understand the need to close the loophole but I do not understand and I do not think we really saw a case made at Second Reading for why the Department of Health is determined to intervene in this sector in such a wide-ranging way. It is interesting that your Lordships’ Delegated Powers Committee has already pointed out the open-ended nature of the Government’s approach.

It is impossible to look at the health of the life sciences and the health of the pharmaceutical, medical devices and medical technology industries in this country without looking at the crucial issue of access. I know the Minister’s department is in denial about this and feels that access can be constantly reduced and will have no effect on investment in these sectors. I simply do not believe that that is so. The noble Lord, Lord Lansley, rightly said that this is one of the sectors that we want to protect and enhance—but I believe we are at real risk of losing its pre-eminence in this country.

I understand that the Secretary of State is shortly to go to North America to sweet talk the boardrooms of US pharma. I know the noble Lord, Lord Warner, has been there. I have been there, too. I am sure that the noble Lord, Lord Lansley, has, too. The idea that the Secretary of State will not talk about access is naive. Access is a crucial part of investment decisions by these companies in the UK. The noble Lord, Lord Lansley, referred to the proportion of new chemical entities and top 100 medicines globally that have been developed in this country. I understand that it is now down to 14%. That is healthy compared to 3% turnover, but when I was the Minister responsible we were in the 20% to 25% range. So we have a horrendous decline in the influence of the UK sector. My fear is it is going to decline even further in the years ahead.

We will come back to the 2014 PPRS agreement. Potentially, the industry would have funded the widespread use of innovative medicines in the NHS. Between them, however, the Treasury, the Department of Health and NHS England have completely messed this up. We have ended up with the worst of all worlds, in which rationing in the NHS has reached appalling levels: CCGs are making some of the crudest rationing decisions that I have ever seen.