UK Drug Pricing Talks Collapse as Health Secretary Ends NHS Rebate Deal

The UK government, led by Health Secretary Wes Streeting, has ended negotiations with pharmaceutical companies over the Voluntary Scheme for Branded Medicines Pricing, Access and Growth (VPAG) due to the industry's rejection of proposed changes to rebate rates. The dispute centers on the clawback tax, which rose unexpectedly to nearly 23%, significantly higher than the original forecast of 15%, resulting in a greater repayment burden on pharmaceutical companies. Streeting accused drug firms of making unaffordable demands and being short-sighted, insisting the government would not allow them to overcharge British taxpayers or NHS patients. The government offered to reduce payment rates year-on-year and accelerate sector growth, which it claims would save approximately £1 billion over three years and improve patient access to medicines. However, the Association of the British Pharmaceutical Industry (ABPI) warned that continuing the existing scheme without changes risks harming the competitiveness of the UK life sciences sector and could lead to fewer new medicines being launched in the UK, potentially disadvantaging patients. With talks concluded without agreement, the VPAG scheme remains unchanged, and the government vows to maintain a balance between NHS budget sustainability and fostering innovation.