Question to the Department of Health and Social Care:

To ask the Secretary of State for Health and Social Care, with reference to paragraph 16 of Annex B of the Impact Assessment for the Statutory Scheme – Branded Medicines Pricing, what the evidential basis is for the assessment that the resources deployed through pharmaceutical investment would come to the UK in another form; and whether his Department has made an assessment of the potential efficiency of alternative deployment of resources.

The approach to assessing the potential impacts on investment within the statutory scheme’s impact assessment followed well established precedent and is in-line with the Green Book paragraphs 6.5 and 6.6. As such the impact assessment considers spill-over benefits of investment, with a literature review suggesting an estimated mean benefit of 34% of the overall investment, but does not account for these within the net present value calculation due to investment being one of several possible company responses to change in profitability.

We are in the process of analysing the responses provided to the consultation on this statutory scheme and will update on our preferred policy approach later this year.

Regarding alternative deployment of resource, by controlling growth in the cost of medicines we ensure value for money for the taxpayer and enable the National Health Service to continue investing in patient access to new medicines. Any additional spending on medicines may come at the cost of other equally (or more) effective healthcare spending.