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BGMA Report Finds NHS Will Lose £100M In Savings Over Next Five Years

Aug 15, 2023

The British Generics and Biosimilars Associations (BGMA) has released a report finding that the NHS is projected to lose out on approximately £100M in savings per year by 2028 due to reduced biosimilar competition on the 85 biologics which are due to lose patent exclusivity in the next five years.

The figures were calculated by reference to the UK’s voluntary scheme for branded medicines pricing and access (VPAS) scheme, an agreement between the Department of Health and Social Care (DHSC), NHS England and the Association of the British Pharmaceutical Industry (ABPI).  VPAS sets a 2% per annum cap on the total allowed sales value of branded medicines to the NHS, and sales above that cap are repaid to DHSC through a rebate system.  Biosimilars also fall under this scheme.

Currently members of VPAS currently pay back 26.5% of their medicine sales, which is calculated so that the NHS’ net branded medicines sales increase only to that 2% rate per year.

The BGMA report states that the rising VPAS rate is threatening the launch of new biosimilars, as many manufacturers are not able to absorb the cost of competition as well as the VPAS rebate, ultimately leading to companies prioritising other markets.  The research shows that if on average one company is deterred from entering a biosimilar market where molecule exclusivity has been lost between 2023 and 2028,  the NHS is projected to lose out on around £100M in savings per year by 2028. If two entrants were lost, the figure increases to £250M.

VPAS is in place until 31 December 2023, and negotiations for the next five years are ongoing.  The proposed review of the 2023 scheme to control the cost of branded health service medicines consultation will run until 10 October 2023, and responses can be submitted at the DHSC website.