New conductor, old tune from U.K. pharma lobby as ABPI threatens exodus

The ABPI's warning came as the U.K. government recently called a snap election.

The Association of the British Pharmaceutical Industry (ABPI), which is the main pharma R&D lobby group in the U.K., has hit the national front pages today over threats the industry could start to leave the country, delay the launch of medicines and not be able to fund research unless the government/taxpayers stump up an extra £20 billion and play NICE on drug rationing.

Speaking to The Times of London, the ABPI’s new president, AstraZeneca’s Lisa Anson, said: “Recent rationing signals are warning signs that we are eroding the … research environment and access to new medicines by eroding the competitiveness of a key sector for a short-term affordability issue.”

She also warned that the U.K. would become a “desert for healthcare innovation,” adding: “We are ambitious to have the life sciences sector, which is one of the key sectors of the UK economy, [as] world class then our aspiration should be to have a world-class NHS with world-class outcomes for patients.”

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The ABPI is asking for a major boost in health spending in the U.K., from 9.9% to 11% of GDP, which could be around £20 billion ($25.7 billion); the total NHS budget each year is around £105 billion. Anson said if it doesn't get this, companies could leave the country. This comes as the U.K. gears up for a snap general election in June, and the ABPI is getting in early for its political wish list.

After Brexit, the NHS is the second most important issue to voters, according to pollsters, although there are major issues outside of medicines, predominantly around the retention and creation of new doctors and the need to make major savings across the service.

The ABPI also warns against “rationing” drugs, an indirect dig at England’s NICE and other HTA bodies in Scotland, Wales and Northern Ireland, which will not allow the NHS to fund new medicines if they are not deemed cost-effective. This typically affects cancer drugs, a major profit spinner for pharma, but ones with high price tags not always justified by their trial data. 

These demands are nothing new, and the ABPI has been calling on the reform of NICE, asking for higher spending, and threatening an exodus for several years.

To date, none have left the U.K.’s shores, and when ABPI members such as Pfizer and AstraZeneca have closed up R&D centers in England, this has invariably been because of global headwinds and patent losses that have required a tightening of belts across the board rather than any U.K.-specific issues.

In fact, the largest native pharma company and ABPI member, GlaxoSmithKline, insisted just last year, and after the country decided to leave the EU (a decision it voted against), that the U.K. remains an attractive place to invest and has no plans to leave.

Some pharma companies have, however, left the ABPI, with Swiss cancer major Roche exiting as a member back in 2009.

The pharma industry has done well out of the NHS over the years, with the government-funded health service spending around £15 billion a year on medicines, with around 60% of that on prescription medicines from family doctors and the rest mainly from hospitals.

The cost of medicines has also gone up consistently each year, with NHS data services showing a rise of around 7% to 8% year-on-year on average across primary and secondary care and around 15% in hospitals over the past few years. 

AbbVie’s Humira (adalimumab) tops the hospital drug costs, with Novartis’ Lucentis (ranibizumab) and Amgen’s Enbrel (etanercept) rounding off the top three in years gone by.

It remains to be seen where pharma companies would go if they left the U.K., as other science powerhouses in Germany and the U.S., for example, are also keen to push down drug prices.

Bigger issues have also arisen in the past 12 months, with the uncertainty of Brexit leaving the fate of the London-based EMA in limbo, as well as the future of the U.K. economy, VC cash flow for small biopharmas, and the strain this could put on the NHS all likely keeping many in the industry, the government and the NHS awake at night.