U.K. to spend less on branded drugs, report finds

Drugmakers can't get a break in Europe these days. Bad debt in Greece and Spain. Price cuts not only in troubled southern Europe, but Germany and France, too. And now, a report shows that U.K. spending on new drugs is set to drop through 2015.

According to a forecast from the National Health Service, requested by the pharma association in Britain, drug spending as a whole is expected to increase, but spending on branded medications is set to grow at a lower rate. That means branded products will see their share shrink as the NHS allocates more spending on generics.

Drug spending overall will grow by 3.7% annually through 2015, compared with 3.5% from 2007 to 2011, the report says. Spending on new branded drugs will rise by only 1.3% a year. And by 2015, drugs launched over the next three years will account for only 2% of total drug spending.

"These figures show our spending on the newest and most advanced medicines is declining in real terms," ABPI chief Stephen Whitehead said in a statement. "This spells bad news for the discovery of new life saving medicines." The report comes as the NHS and pharma industry prepare to negotiate a new value-based pricing plan.

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