Eli Lilly and AbbVie leave UK VPAS; blow to UK pharma industry
Eli Lilly and AbbVie have announced their departure from the voluntary scheme for branded medicines pricing and access (VPAS), causing worry that NHS patients may miss out on breakthrough drug treatments.
VPAS is an agreement that was set up in 2019 between the Government, NHS and medicine manufacturers designed to limit the cost of drugs for the health service while supporting industry innovation. It caps the health services branded medicines bill, which means that all drug manufacturers would face a charge if the bill rose more than 2% annually.
However, the charge has risen too rapidly for many companies over the recent years. As of December 2022, the payback rate was set at 26.5% ‒ before the pandemic, the payback rate was about 5%.
Dr Richard Torbett, the chief executive at the Association of the British Pharmaceutical Industry (ABPI), said that demand for new medicines has grown “much faster than industry pre-pandemic projections – driving up the repayment rates far beyond sustainable levels” owing to the record backlog of patients waiting for NHS treatment. The current VPAS deal means that “despite demand for branded medicines rising sharply, driven by clinical decisions and patient need, the money spent on them has declined by 14% in real terms over the last decade,” he added.
Because of this, Eli Lilly and AbbVie have become the first to leave the VPAS in favour of an alternative statutory scheme, which will be imposed by law and have higher repayment rates. The ABPI has said that this highlights the “depth of feeling” over the failures of VPAS.
This has raised fears that NHS patients will struggle to access cutting-edge treatment in the future, as firms may feel deterred from investing in the UK.
Laura Steele, Eli Lilly’s president and general manager for northern Europe, said: “We simply cannot stay signed up to a scheme, which has such a punishing impact on innovation. We want to see action on a new settlement that allows life sciences to thrive in the UK now and over the long term, to boost investment in the UK and ensure patients here can benefit rapidly from cutting-edge clinical trials and medicines.”