Key Summary
- The UK chief of Norvartis, Johan Kahlstrom, said the country was "largely uninvestable"
- The rebate drug companies pay to NHS is 23.5 percent, while in Germany it is 7 percent
- The company said due to the "declining competitiveness" of the UK market, it been unable to launch several medicines in the country
Amid a row over drug pricing deals between the government and pharma companies, the Novartis UK chief has claimed that NHS patients will lose access to new cutting-edge treatments.
Last week, the talks over the cost of medicines for the UK between Health Secretary Wes Streeting and the Association of the British Pharmaceutical Industry (ABPI) broke down.
The industry group failed to agree to government proposals for how much their revenues should be capped over the next three years.
The dispute centres around the voluntary pricing and access scheme (VPAG), under which the NHS sets its budget for branded medicines, and companies agree to pay back any revenues they make that go beyond that amount.
In 2023, a 15 percent rate was expected, but the actual rebate rate has risen to 23.5 percent.
While drug companies have called for a review of the National Institute for Health and Care Excellence (NICE) cost-effectiveness threshold, Streeting has said the pharma industry was making unaffordable demands on the NHS.
Norvartis UK chief, Johan Kahlstrom, said costs meant the UK was "largely uninvestable".
The Swiss firm said it was not considering the UK for major new investments in manufacturing, research, or advanced technology and cited "systemic barriers".
In 2023, a deal was done with predictions of how big the rebate should be that pharma companies would have to pay the UK government on sales to the NHS above an agreed threshold.
He pointed out that in Germany, the rebate the drug companies pay is 7 percent.
The company said due to the "declining competitiveness" of the UK market, it has been unable to launch several medicines in the country.
It warned that if the UK remains uncompetitive, future launches and research investment could take a hit.
Earlier, the UK president of AstraZeneca, Tom Keith-Roach, said it was “hard to champion” the country as a place for investment and research.
