Holded discounts ?: BNBC UK Exchangi

In this report by the Exchange newsletter in the UK this week. Every Wednesday, Jan King brings you expert ideas about the most important business stories from the UK and other key events you don’t want to miss. How is what you see? You can subscribe Here.

In Astrazeneca and GskThe country boasts two of the 15 largest pharmaceutical companies in the world – only the United States and Switzerland can match this – at Cambridge, Oxford and Imperial College London, three of the top 10 universities in the world in life. This is also one of the top five global investment areas for life science research.

Under the surface, however, everything is not so good. Relations between the Government and the Great Britain-Chi-Chi-chi-chi trading body, as well as the AZ and GSK, include internal weapons of multinational companies such as Pfizer, Sanofi, Merck, Eli Lilly and Bristol-Myers Squibb-pursuing the problem of drug pricing.

Most branded medicines buy the State National Health Service (NHS). Thanks to its size – it accounts for approximately 85% of healthcare costs – NHS enjoys a huge purchase.

For decades, it has been backed up by voluntary price agreements, voluntarily in the sense that the unreliable conditions would be worse and NHS. The last of these is the voluntary pricing scheme, access and growth of branded medicines (VPag), came into force in January last year.

According to this scheme, having agreed between the government, the NHS ENGland and the branch body, the British Pharmaceutical Industry Association (ABPI) is set to how many NHS spends on branded medicines each year. Currently, this restriction can increase by 2% a year, increasing to 4% a year by 2027. To force restriction, pharmaceutical companies agree to pay off the NHS drug selling percentage or “return”. Over the last 11 years, this discount was just over 10%, but in December last year, Wes -Streng, the current Secretary of State for Health, shocked Galina, setting a rate of 23% – significantly ahead of the expected 15%.

ABPI immediately warned that it would be a “very real load on the company” and at risk of growth and investment in the UK.

It is stated that 9%of the UK health costs NHS launches a lesser share of health care costs than any comparable country, and France spent 15%, and Germany and Italy.

Since then, the negotiations have been sharpened, but 12 days ago the negotiations were thrown after ABPI rejected its proposal, which included a decrease in the level of discounts over all the coming years and the rise in both the price of new medicines and pure costs for them.

He said to the newspapers: “I will not allow Big Parma to disrupt our patients and taxpayers.”

In July, in July, he had already thwarted relations between the government and the Az, whose executive director Pascal Soriot announced plans to invest about $ 50 billion in the US (which last year amounted to 43% of the company’s world sales) by 2030 and followed the earnings, calling AZ “very US company”. The value of this was that, according to The Times, Soriot was In privately discussed Moving the main list of AZ, the largest company in FTSE-100, to New York.

Although he is the biggest name in the UK Pharma, Soriot is not the only leader of the branch’s industry at the discount level.

John McGinley, President of the UK Pfizer, said in ABPI report publish In March, an unexpected hike was “incompatible with the UK government’s ambitions to be a global leader of life.”

In the same report, Doin Jonecu, General Merk General in the UK and Ireland, called the new rate “inaccessible”, adding that it would interfere with “our ability to identify innovative medicines and deliver them to patients.”

The latest critic is Johan Calstra, the head of the director of Novartis UK, who last week told the BBC that the UK “became largely uninvited” for drug manufacturers.

US President Donald Trump hides in the background. The president demanded that pharmaceutical companies reduce drug prices in the US to bring them into alignment with types in Europe and Canada. This differential price largely reflects how the US healthcare system is, but nevertheless allowed Trump to claim that US patients subsidize their colleagues elsewhere.

Companies such as Eli Lily have stated that in order for drug prices to fall in the US, the price paid for drugs in health systems elsewhere may be required. Last week, this month temporarily suspended supplies to the UK Mounjaro, his weight loss drugs, ahead of the great prices this month.

Thus, Trump’s requirements increase the need for drug manufacturers to extract the best conditions from the UK government. By drawing up a problem, they may not want to agree with these conditions as long as they no longer learn about Trump’s proposed tariffs on pharmaceutical imports, which probably have an inflationary impact on the US prices and thus had even greater pressure on their prices.

Other undesirable side effects may be in the line over the discount. This gives drug manufacturers such as AZ, justification for distraction and development costs in the US as Trump requires.

They are also less likely to launch new medicines in the UK – what is already happening from another fight against this industry, namely the criteria used by the National Institute of Health and Perfection (Nice), an accountable authority that decides whether new medicines for NHS are of good importance.

Everything leaves the UK government, which has pledged to make the country “superpowers about life”.

UK assets have been suffering in recent days because the concern of the country’s financial prospects and the debt resilience has returned to the fore. Sterling fell more than 1% to the US dollar on Tuesday when borrowing costs increased on the boards, with A 30-year crop Reaching the highest level since 1998.

A FTSE 100 Meanwhile, he continued to fall off from the launch of the record highs of Augustus. Last week, the Blue Chip index fell 1.44% and lost another 0.44% since the beginning of September. This is against a broader disgust of the risks in world actions, as well as in European actions, as well as at Wall -Strit.