UK pharma seeks reasons to be cheerful

By?Guy Martin?

28-04-2023

As senior figures from the UK biopharma industry gathered in a gloomy London for the Annual Conference of The Association of the British Pharmaceutical Industry (ABPI), many speakers and panellists showed a stoic positivity despite the myriad of challenges engulfing the sector.

As well as the broader budgetary constraints facing the National Health Service (NHS) and their inevitable impact on the UK’s ability to pay for medicines, the sector is facing a number of challenges that bring into question the government’s ambition set out in the 2021 Life Sciences Vision, seeking to create a global superpower in the field.

The VPAS priority

Perhaps the most pressing issue - certainly so far as pharma bosses are concerned - is the renegotiation of the Voluntary Pricing and Access Scheme (VPAS). Many companies, and the ABPI itself, have expressed concern that the lofty ambitions are being harmed by the rapid rise in the revenue tax stipulated through the scheme.

In 2021, the VPAS rebate meant that companies paid around 5% of their revenue back to NHS. But in 2022, it rose to 15% and in 2023, to 26.5%. The ABPI has stressed that this is completely outside both historical and international norms, and it has dubbed today’s VPAS ‘unfit for purpose’ and unsuitable for renewal in its current form when it concludes at the end of 2023.

Giving his opening speech to the conference, ABPI chief executive Richard Torbett said that the upcoming negotiations on the new voluntary scheme were “absolutely critical to improve the operating environment for every part of our industry.”

He added: “Right now, I know that VPAS is being discussed in global boardrooms in – shall we say - not very complimentary terms.

“All of us appreciate the huge need to make progress quickly. In order for the UK to be a global leading hub, we must be internationally competitive.”

The ABPI has published what it calls the ‘industry’s vision’ for a new agreement with the government, promising that it will deliver for patients, the NHS and the economy.

The group has called this vision the Voluntary Scheme for Pricing, Access and Growth (VPAG).

Among the proposals is a fixed rebate rate of 6.88% levied across all eligible NHS medicine sales to be paid by the industry. The ABPI also proposes that it could contribute to an investment facility worth more than ￡1 billion ($1.26 billion) over five years, to maximize the potential of the UK health and life sciences ecosystem as an engine for innovation-led economic growth.

Mr Torbett said: “Securing this vision will require a new mindset from everyone, from government, system partners and us in industry.”

The UK’s Health and Social Care Secretary Steve Barclay told industry members at the conference that the deal needs to be “good for patients, good for the NHS and good for you, too”, promising that the government was a “committed partner” to the sector.

'Alarming' slump in UK trials

Another increasingly urgent issue that came up repeatedly at the conference was the decline in UK clinical trials. Figures show that there has been around a 48% drop in Phase III studies between 2017 and 2021. Globally, the UK came fourth for hosting these trials in 2017, but four years later had slipped to 10th.

Among those to stress the many benefits of UK trials for patients, the NHS and the economy was Catherine Elliott, director of research and partnerships, Cancer Research UK, who said: “There’s no doubt that research drives economic growth for the UK.”

Jill Richardson, executive director and head of biology for Merck & Co’s (NYSE: MRK) London Discovery Centre, bemoaned the amount of time it can take to set up clinical trials in the UK, saying that there was a risk of missing out to more competitive nations such as Spain.

“I think it’s quite alarming, the clinical research decline,” she said.

Relating to clinical trials, Mr Barclay said: “If there’s one message I want you to take from my speech today it’s this: we need companies - including a great many represented by you in this room today - to invest in UK clinical trials.

“I know there are challenges, and we are listening, not least on how we can support those consultant clinical academics who drive medical breakthroughs.

“It is why we have commissioned James O’Shaughnessy to conduct an independent review of the UK commercial clinical trials landscape.”

The government has promised to respond to some of the review’s early findings within weeks.

A pivotal moment

Summing up the current state of the sector, Mr Torbett said: “There can be no doubt that the UK’s life sciences industry is at a crossroads right now - one way leads to economic growth, a thriving research and development ecosystem, and better health outcomes for UK patients.

“The other path frankly has the UK slipping further down international league tables, our regions and nations continuing to miss out on investment, and poorer health and productivity outcomes across the country.”

Mr Barclay listed reasons why he is confident that the UK can address current challenges facing UK life sciences and seize new opportunities.

“Innovative new ways of working from the pandemic,” he said. “A post-Brexit regulatory environment that offers the agility to design a more bespoke and effective environment. And a new way forward for clinical trials through implementing the James O’Shaughnessy review.

“Taken together, it means the UK is well-placed to seize these opportunities—working in partnership with the talent we have within the Department of Health and its arm’s length bodies, with our fantastic NHS - including frontline medical staff, and in partnership with you on behalf of the industries that you represent.”