U.K. pharma balks at value-based pricing ideas

Drugmakers are squaring off against the U.K.'s price-setting proposals. As Britain approaches its new value-based pricing system--set to come into effect in 2014--an industry association warns that the government's approach will put too much emphasis on "breakthrough" treatments, discounting the importance of incremental advances.

The U.K.'s pricing change is just one of many in the region. Germany adopted a radical new scheme that offers big rewards for products that are clearly superior to existing treatments--but limits premiums on drugs that don't prove better than alternatives already on the market. Other European countries have slashed drug prices across the board or set up reimbursement plans to steer patients away from most branded drugs.

As drugmakers lose ground elsewhere, they're increasingly intent upon preserving pricing freedom--such as it is--wherever they can. The rallying cry is once again innovation, and the Association of the British Pharmaceutical Industry is warning that the U.K. will lose its pharma citizens if it doesn't reward investment in new drugs.

"[T]he government wants to target resources at big breakthroughs, but the science shows us that developments in medicines are made in small steps," ABPI chief Stephen Whitehead said, adding that manufacturers "will go abroad" if innovation isn't protected. "Our industry, our economy and our healthcare system will suffer," Whitehead said.

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