The Association of the British Pharmaceutical Industry (ABPI) and the Department of Health and Social Care (DHSC) have confirmed that they have ended negotiations on amendments to the 2024 Voluntary Scheme for Branded Medicines Pricing, Access and Growth (VPAG). The breakdown of the talks between the government and the ABPI mean that the pharmaceutical industry will continue to pay annual rebates on sales calculated by the current mechanism under VPAG, which produced a repayment rate of 22.9% on "newer" medicines for 2025.
Reporting indicates that the UK Health Secretary had made a "take-it-or-leave-it" offer to the ABPI. However, the terms of the offer were unacceptable to the ABPI. An ABPI press release indicates it considered the offer did not go far enough to alleviate high repayment rates under the current scheme and bring them back down to single digits and more into line with comparable European countries. The offer also failed to address concerns regarding the cost-effectiveness thresholds imposed by the National Institute of Health and Care Excellence (NICE), which determines access to medicines by NHS patients in England.
The government and ABPI had earlier in the year agreed to bring forward the planned mid-point review on the functioning of VPAG after the mechanism for calculating the annual rebate rate produced a much higher than expected repayment rate for 2025. The ABPI had previously described repayment rates at this level as "unsustainable" (see our earlier article here).
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