Government and industry reach new pricing deal to cut NHS drugs bill

The government and the drug industry this week reached an outline agreement on a new contract for drug prices in the United Kingdom over the next five years. It is expected that the deal will cut the annual £9bn (€11bn; $18bn) drug bill in the UK’s health services by 5% by 2009.

The announcement follows a year of intense and tough negotiations after the Department of Health said it was unilaterally cancelling the current pharmaceutical price regulation scheme (PPRS) halfway through its planned duration (BMJ 2007;335:273 doi: 10.1136/bmj.39300.405822.DB).

The PPRS, which normally runs for five years, allows companies to set drug prices freely …