Insider Insights

The UK government immediately dismisses ABPI proposal of a 6.88% fixed rebate rate as unaffordable and a detriment to the taxpayer 


The ABPI has set out new proposals to replace the VPAS (Voluntary Scheme for Branded Medicines Pricing and Access) agreement. The ABPI hopes these proposals will deliver a sustainable approach to medicines provision whilst maximising the potential of UK life sciences as an engine for growth. Amongst the proposals is a fixed rebate rate of 6.88% across all eligible NHS medicine sales, a proposal that has immediately been dismissed by the UK government as “completely unaffordable”. 

The ABPI stated that the newly named VPAG (Voluntary Scheme for Pricing, Access, and Growth) approach focuses on four key areas: restoring an internationally competitive commercial environment for life sciences, supporting UK clinical research and R&D, ensuring rapid patient access and uptake of new medicines, and improving population health and productivity through health innovation. The proposed 6.88% fixed rebate rate was stated to be capable of delivering £1bn a year to the NHS and proposed an industry-funded ‘Investment Facility’ worth over £1 billion over five years which would be provided by a 1.5% premium on NHS sales paid by scheme members in addition to the scheme repayment rate. The ABPI states that this fund could be used to support key shared priorities like boosting NHS clinical trial capacity and delivery, expanding UK genomics capacity and building UK capability to use real-world data to improve speed, diversity and efficiency of recruitment into clinical trials, to strengthen the UK’s ability to attract investment.  

Of significance within these proposals is the commitment of companies to prioritising the UK as an early launch market, seeking a GB license on their first wave of regulatory filings, which the ABPI believes will enable to UK to regain its position as a “first-wave” country for novel medicine launches. This however would rely on improvements to the UK’s regulatory approach to support rapid access and adoption of new medicines. 

Richard Torbett, Chief Executive at the ABPI, stated: “The life sciences industry in the UK stands at a crossroads. The current direction of travel is leading away from success, and we must act urgently to turn this around. A new Voluntary Scheme for Pricing, Access and Growth provides the opportunity for a new settlement, placing the UK’s life sciences sector back on the path for future growth”. 

However, with an immediate response, the DHSC (the Department of Health and Social Care) has stated: “These proposals are completely unaffordable, costing the taxpayer an extra £2.5bn per year”. They further stated that the new proposals will: “drive up the cost of medicines for the public and reduce NHS patients’ access to new treatments”.  

The current VPAS agreement is due to end on 31 December 2023, and formal negotiations are due to start in the coming weeks.  


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