Health Service Medical Supplies (costs) Bill (first sitting)
Dr James Davies (Vale of Clwyd):
Philip Kennedy: Yes, of course those have not necessarily been enforced or used in practice. Coloplast is a large US multinational. It is active, but it is not actually a member of the Association of British Healthcare Industries, I believe. I could understand its anxiety that a more bureaucratic system that could cut prices or onerous data collection over a long period would frighten investors off. Anything that does that in our sector would not be welcome. However, I think it is less onerous for the larger companies, which would have more substantial resources to crunch data and produce the type of information that Mr Smith has talked about being readily available. That is not really our concern. Our concern would be for the smaller businesses, which simply do not do this, and about the disproportionate impact on them. However, I take the concern that Coloplast and other US multinationals, which have invested heavily in the UK life industry, the life science sector, over the years, would have in seeing this legislation as not attractive to them as investors.
We have received correspondence from an individual who takes liothyronine, as does one of my constituents who is affected by the current issues. He has pointed out that the company that manufactures that makes an excess profit of £50,000 a day as a result of the hike in prices. With that in mind, do you think that the proposed maximum fine, the penalty of £100,000 or £10,000 a day, is sufficient?
David Watson: I am not aware of the individual product. We support the Bill in so far as the Government needs to be able to have the powers to step in where they spot that there have been price hikes that are not justified. It is entirely appropriate that the Department is able to question companies on why that price has gone up. If it has gone up unreasonably, it is entirely correct that they should reduce it. What I would say, though, is that the majority of branded medicines, for example, covered by the PPRS, have an affordability mechanism underneath them. For example, we repay under the PPRS the difference in NHS spend on medicines; so regardless of the list price, which is often quoted for medicines, very often there are significant deals being made underneath that with the NHS.