Health Service Medical Supplies (Costs) Bill

Baroness Laing of Elderslie Excerpts

Tuesday 25th April 2017 Commons Chamber

[The Minister of State, Department of Health (Mr Philip Dunne)]

I beg to move, That this House disagrees with Lords amendment 3B.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

With this it will be convenient to discuss Government amendments (a) and (b) in lieu.

[Mr Dunne]

When we last debated the Bill, I reminded the House of its importance. I do not intend to go over all that ground again, save to note the three primary purposes of the Bill: first, to give powers to align broadly our statutory scheme for the control of prices of branded medicines with our voluntary scheme, by introducing the possibility of a payment percentage for the statutory scheme, which could deliver £90 million of funding for the NHS every year; secondly, to give us stronger powers to set prices of unbranded generic medicines where companies charge unjustifiably high prices in the absence of competition; and, thirdly, to give us stronger powers to require companies in the supply chain for medicines, medical supplies and other related products to provide us with information. We intend to use that information to operate our pricing schemes, to reimburse community pharmacies for the products they dispense and to assure ourselves that the supply chain or specific products provide good value for money for the NHS and the taxpayer.

We agreed with 23 amendments made by their lordships during the passage of the Bill through the other place. Those, we accept, have made this a better Bill. We rejected just a single amendment. Despite the strength of our arguments, the other place has now made amendment 3B, which to all intents and purposes has the same effect as the original Lords amendment 3. It would introduce a duty on the Government, in exercising their functions to control costs, to take into account the need to promote and support a growing life sciences sector and to ensure that patients have access to new medicines. As I explained previously to this House, the amendment, which is no different in its effect from previously, would undermine one of the core purposes of this Bill: to enable the Government to put effective cost controls in place.

In our view, the amendment could encourage companies to bring legal challenges where the cost controls have not in themselves promoted growth in the life sciences industry. That could significantly hinder the Government’s ability to exercise their powers effectively to control costs. That would have a particularly detrimental effect if the Government were to take action to control the price of an unbranded generic medicine where it was clear that the company was exploiting the NHS—a point on which there was cross-party agreement when we debated the matter. That is because the Government might be challenged, not on the basis that the action was inappropriate, but on the basis that it did not promote the life sciences sector. Nevertheless, as I am sure all Members would agree, such action could be the right thing to do for the NHS, patients and taxpayers. The powers in the Bill that enable such action have received universal, cross-party support in both Houses.

Through debate on the issue in the other place, we have clarified that their lordships did not intend to undermine the core purposes of the Bill. Rather, the intent was to ensure a mechanism, laid out on the face of the Bill, to ensure that the Government pause to reflect on the impact of any proposed price control scheme on the life sciences industry and access to cost-effective medicines. With this clarity, the Government are now proposing amendments in lieu of Lords amendment 3B that will achieve that intent without undermining the core purpose of the Bill.

Consultation requirements prior to the implementation of any new statutory price control scheme for medicines are already set out in section 263 of the National Health Service Act 2006. Our amendment (b) in lieu would amend the 2006 Act to include particular factors that must be consulted on before proceeding with a new statutory scheme. They are:

“(a) the economic consequences for the life sciences industry in the United Kingdom;

(b) the consequences for the economy of the United Kingdom;

(c) the consequences for patients to whom any health service medicines are to be supplied and for other health service patients.”

The requirements are framed in that way to allow us not only to consider the economic consequences for the life sciences industry and for patients who may benefit from new medicines, but to balance those factors against wider considerations. I am sure the whole House can agree that while a thriving life sciences industry and access to new medicines are highly desirable, they must not come at any cost. It is the Government’s responsibility to achieve the right balance, and, indeed, to be held to account for it.

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. I thank the hon. Gentleman for his extremely kind words, and for his courtesy, which he always shows at the Dispatch Box and in the Chamber.

[Dr Philippa Whitford (Central Ayrshire) (SNP)]

Like the hon. Member for Ellesmere Port and Neston (Justin Madders), this will be my last time speaking in the Chamber before Dissolution, and as a newbie I also want to pay tribute to the staff of the House, who made coming here much easier than we had expected it to be. I am also glad that my final speech before Dissolution is on a Bill that, despite some of our disagreements, we have worked on on a cross-party basis to produce a piece of work that we all agreed needed to be done.

I, too, welcome Government amendment (b), although I would have laid out the three paragraphs the other way around, because the whole point of the NHS, and the whole reason we are discussing this, is patient access: that is the No. 1 concern. I would have put patients first, not third. The fear of not getting access to drugs is a great issue for patients. As the hon. Gentleman mentioned, we have a significant delay that is measurable in comparison with other countries. For certain types of cancer, our performance in relation to patients with early disease is as good as anywhere, but we fall down in dealing with people with difficult or advanced disease. That is because of the delay.

I want briefly to mention the interaction of the budget impact assessment with our no longer being part of the European Medicines Agency. I am not talking about the United Kingdom losing the agency itself; I am talking about our no longer being part of the scheme. We know that there is a danger that drugs are presented for licensing in the United Kingdom at a later date than in the United States and the European Union, which are major markets. It is likely that we could also be behind Japan. I am not suggesting that we should simply hand over any amount of money, but if we were also seen as a hostile market in which there was an expected delay of three years for expensive drugs, there would be a danger that international pharma would simply say, “You know what? We’ll license everywhere else, then we’ll come back to the UK in a few years.” That could result in significant delayed access for our patients.

We need to think about how all this feeds into trials and research, and into the life sciences system. If we are not using what is considered to be the gold standard drug at the time of a new international trial, we will not be able to take part in the comparison of the gold standard with the new drug. The UK has led the EU research network, which is the biggest research network in the world. We have been a major player in that, and it is important to realise how building in this delay from NHS England could undermine that. Surely this should be part of the NICE process. It should be clear to pharma, when it comes with a drug at a price, what process it will have to go through, what evidence it will have to bring forward and how it will have to negotiate a price. I fear that there will be delays in drugs being licensed.

This will affect us in Scotland even though NICE decisions do not apply to us. If a drug were simply not licensed here, it would be irrelevant that the Scottish Medicines Consortium chose to fund it—as it did the other week with Kadcyla—because it would still be an unlicensed medicine. We need to look at how the loss of the European Medicines Agency will work in this regard. There should not be a separate procedure after NICE that could suddenly hit pharma with another barrier to jump over. This will hit new cancer drugs, because they are expensive. It will particularly hit drugs for rare diseases, which the EMA has led on, because they are bespoke and therefore inevitably expensive. The £20 million limit would mean that if someone came up with a fabulous cure for dementia, for example, a budget impact assessment would be triggered.