Question to the Department of Health and Social Care:

To ask the Secretary of State for Health and Social Care, what steps she is taking to help ensure value for money in (a) medicines and (b) medical supplies in the NHS.

A series of voluntary agreements between Government and the pharmaceuticals industry have existed since 1957 to control National Health Service spend on branded medicines. The current scheme came into effect at the start of 2019 and will last until the end of 2023. Agreement has been reached in principle with the Association of the British Pharmaceutical Industry on a successor scheme, the voluntary scheme for branded medicines pricing, access and growth, which is set to save the NHS £14 billion over five years in medicines costs. The Department also has a broadly equivalent statutory scheme for branded medicine pricing which applies to companies that do not opt into the voluntary scheme.

For unbranded, generic medicines, the Department relies on competition to keep prices down, allowing 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.

The National Institute for Health and Care Excellence (NICE) ensures that the price that the NHS pays for medicines represents value for money and it recommends most medicines for use on the NHS. NICE decides whether medicines should be routinely funded by the NHS based on an assessment of their costs and benefits.

The Medical Technology Strategy, published in February 2023, committed to developing an environment to deliver value for money and affordability across the whole patient pathway for medical supplies. As part of this commitment, the Department is working closely with NHS England and NHS Supply Chain alongside industry and patient groups to develop a consistent methodology for assessing value in terms of outcomes and not just unit cost, which will be adopted at both a national and local level. This is reflected in the new Commercial Strategic Framework launched by NHS England on 28 November 2023 in which a focus on value is recognised as a priority intervention. Further to this, as part of the wider Value Based Procurement (VBP) programme being delivered by NHS England and NHS Supply Chain has developed a toolkit and two VBP models. One model can be applied to the renewal of existing frameworks or contracts for product ranges, and the other is for the procurement of innovation. The toolkit and models are designed for internal use by NHS Supply Chain’s procurement teams and Category Management Service Providers and are not available for publication.