Merck Research Site

Lord Clement-Jones Excerpts

Thursday 11th September 2025 Lords Chamber

[Lord Vallance of Balham (Lab)]

The decrease in funding for the life sciences sector, in terms of NHS purchasing of medicines, started in 2015 and has continued since. It has not been a good position. We are reversing that now with the Life Sciences Sector Plan to make sure there is proper investment. Some £2 billion is going in as part of that plan, and £500 million has already gone in for a manufacturing investment fund and £600 million for a health data research service. The changes we are making will continue to make this a place where people want to invest, but I reiterate that the loss of those jobs and the Merck research centre as part of its global cuts is very disappointing.

[Lord Clement-Jones (LD)]

My Lords, a narrative is developing: AstraZeneca is relocating to Ireland; the Health Secretary walked out of talks with the industry in August on the voluntary pricing scheme for branded medicines; and now we are seeing this cancellation by Merck. Does this not call into question the whole of the Government’s VPAG policy, which has seen payback rates for new medicines unexpectedly surge to 22.9% in 2025? What are the Irish doing right that this Government should emulate?

[Lord Vallance of Balham (Lab)]

I thank the noble Lord for raising the VPAG scheme. The VPAG scheme, which was negotiated under the previous Government, turned out with a figure of 23%, which was completely unexpected on both sides. The industry entered the scheme jointly with government, negotiated it and that is the number it came up with. We have been trying to negotiate a better position so that the industry gets more from that and is not hit with 23%. That is the deal going on at the moment. We are trying to make the environment better for companies and to rectify something that ended up in the wrong place.