Question to the Department of Health and Social Care:

To ask the Secretary of State for Health and Social Care, whether he has made an assessment of the potential impact of the (a) voluntary scheme for branded medicines pricing, access and growth and (b) statutory scheme payment rates on attracting pharmaceutical companies to invest in (i) clinical trials, (ii) research and development and (iii) manufacturing.

Life sciences is a key growth-driving sector and is a core part of our modern Industrial Strategy. The 2024 Voluntary Scheme for Branded Medicines Pricing and Access (VPAG) introduced, for the first time, an approximately £400 million industry-funded VPAG Investment Programme. Funding from the VPAG Investment Programme is used to accelerate work across the United Kingdom on clinical trials, manufacturing, and health technology assessments. This is encouraging the United Kingdom’s economic growth, collaboration, and innovation in the health and life sciences sector.

In recognition of the concerns raised by industry regarding the higher than expected headline payment percentage rates in the VPAG this year, the Department brought forward an expedited scheme review. The conclusion to this review will be communicated in due course.

Any company that chooses not to be part of the VPAG will automatically be subject to the statutory scheme, which was recently subject to amendments, which will come into force on 1 July 2025. The purpose of these amendments is to restore broad commercial equivalence with the VPAG, to ensure that the schemes can continue to work together to meet our objectives of acting in the best interests of industry, patients, the National Health Service, and the broader economy. An impact assessment was conducted and published alongside the amending statutory instrument for this most recent update, which included consideration of the impact on clinical trials and manufacturing.

Additionally, the Government is developing the Life Sciences Sector Plan and 10-Year Health Plan to make the UK the premier destination for life sciences investment, by fostering an environment where innovation thrives.