At least two drug companies have privately warned ministers that they will cease or curtail operations in the UK unless they are spared what industry leaders have dubbed a “penalising” levy designed to limit the NHS’s medicines bill.
Letters seen by the Financial Times reveal profound concern about the Voluntary Scheme for Branded Medicines Pricing and Access, which was introduced in 2019. VPAS requires companies to pay 15 per cent of revenues to the Department of Health and Social Care if the health service’s overall bill for medicines rises by more than 2 per cent annually.
The scheme was originally intended to limit the amount the NHS spent on new medicines, whose manufacturers have the power to raise prices because their products are protected from competition by patents.