A high-stakes standoff between the UK government and the pharmaceutical industry has intensified, with major drugmakers halting investment amidst a dispute over drug pricing. Last month, companies rejected an ultimatum from the health secretary on a new pricing deal, and now the consequences are becoming clear as investment worth billions is put on ice.
Sanofi’s UK head of market access, Paul Naish, articulated the industry’s frustration, stating the UK is an “expensive place to operate” and a “terrible place to sell medicines.” His company has backed up this sentiment by cutting its UK clinical trials by 50% and pausing further investment until it sees “tangible progress” from ministers.
This sentiment is shared across the sector. In a major blow to UK research, MSD has scrapped its £1bn London research facility. Eli Lilly, another industry titan, has also confirmed its planned London lab is on hold pending improvements in the commercial landscape. These actions underscore a widespread loss of confidence in the UK market.
The industry’s demands are specific: raise the outdated price thresholds set by NICE, which have been static since 1999, and drastically reduce the “clawback rate” on revenues. With talks reportedly being reopened, the pressure is on the government to present a new offer that can restore the UK’s competitiveness and prevent a further exodus of pharmaceutical innovation.