As I said, this is about the scheme and the pricing for this year. The negotiations happening now are about future years, while, technically, this debate is about making sure that the alignment is there for this year and its pricing. Given that the discount has been decided on for this year for the voluntary scheme, having alignment will ensure fairness, so that members in the voluntary scheme are not suddenly disadvantaged against the statutory scheme—which would happen if we were not putting in a similar price. It does not in any way predicate what a negotiated outcome might be for future years.
In terms of a future negotiation, if there was a VPAS-type scheme—again, everything is on the table—you would have the argument about alignment. Most people would accept, as my noble friend Lord Lansley was saying, that having an alignment between the two
is a sensible mechanism. The real debate today is about what level that discount should be. Regarding the balance—and I am not making any value judgment about what the right level is—when this was first forecast in 2018, a forecast was put out about what the discount would be over a five-year period, and in year 5 it showed a discount in 2023 of 31.1%. Those were the projections made, at that time—in 2018—the ABPI welcomed the scheme as an innovative one. In fact, today, the discount is less than that, at 26.5%. This was all known and projected as part of the scheme at the time. That is not to say that, in these negotiations, it should not be reset or that we should not make sure that there is a sensible conversation, but I am trying to do this while making sure that there is a balance in the negotiation.
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Turning to what the noble Baroness, Lady Wheeler, said about access, the evidence shows that we are in the top three in the world in terms of access and speed at which we get the top medicines. NICE has reduced the approval period from an average of 10 months to two months, so we really can get these things very quickly, and as we have shown, it approved 92% of medicines. We can see that we are getting access for patients. However, the key issue is not that but whether we are going to set the right conditions for the life sciences industry.
Again, as the noble Baroness, Lady Wheeler, and other noble Lords mentioned, it is not just about the price of drugs in the UK, because the UK is just one part of a very large market. When a company is deciding where to invest, it looks at all the conditions—how available clinical research is and how easy it is to do it, and whether the skilled people and the tax regimes, including tax credits, are in place. I absolutely accept that pricing is obviously a part of that, but you are making the R&D decisions across those bucket measures. It is vital in this debate that we make sure we are doing everything we can in the clinical research space; that is why I am so glad about the investments we are making in the federated data platform, so there is that clinical research database that industry can draw on. Obviously, we will look at a balance of recommendations in clinical research, so that we make sure we put the best environment in place.
On the point made by the noble Lord, Lord Hunt, about the discount rate, that is a matter for NICE, which I know it is considering. That is a slightly different point, but it is relevant in all this.
My noble friend Lord Lansley referred to branded generic drugs and whether they should be outside the scheme. It is a very good point, and one that is recognised, and it is being considered in the negotiations. Regarding whether we were discouraging new drugs coming on to the scheme and our getting access to them, of course, there is a three-year exemption from the VPAS, so with any new drug it is only in the fourth year that the rebates apply. It is precisely designed so there is that three-year runway, which will, I hope, ensure that we get access to the best drugs early on. As I said before, that is what the evidence shows.
Regarding how our pricing compares to other countries, the difficulty in trying to compare rebates is what level you start those rebates from, because you have different pricing to begin with. You cannot like-for-like compare 26% to 12%, because it all depends on what it is a discount from. So it is a complex area. If you look at the average spend per patient on medicines, assuming that European countries generally have a similar approach to the sorts of medicines that patients should have, you will see that our average spend is comparable to other European countries. So, on a very broad basis, I would say that the pricing is largely comparable and, to my knowledge, is not particularly out of kilter.
In response to the question from the noble Lord, Lord Allan, about the number of companies leaving: to my knowledge, five companies have moved recently. Clearly, if any more than zero companies move we should always want to understand the reason, so that is something that we need to be taking note of. I understand about signals to business. As the House knows, I was a CFO, and I know that when you are making your projections, suddenly having a large amount to claw back from your budget is not helpful in terms of investment decisions.
While it is difficult to talk too much about what is going on in negotiations, I would hope that noble Lords can see from my responses that there is a wide consideration of factors in play here. There is a balance we are trying to get right between it all. I should say in terms of balance that we are still in the top three countries in terms of investment. We had £1.9 billion invested from overseas in the UK, which put us in the top three worldwide, compared with £600 million just a few years ago in 2019. We raised £7 billion in terms of equity, so, while there are clearly areas that we need to keep an eagle eye on and not be complacent, at the same time, in terms of balance, we should accept that we are performing well in those areas.
After this last point, I hope I will have covered all the points raised, but, as ever, I will write a detailed response. In terms of the consultation period, I know that six weeks might generally be considered quite a short time. In this industry, where the scheme is very well known, there is a lot of knowledge and the forecasts have been highlighted for quite a while, I think the general feeling was that actually six weeks was not an unreasonable period, given the knowledge base; it was not as if this was a normal consultation.
I hope from the way I have responded to this debate that noble Lords go away with the impression that we are trying to get a balanced outcome here. As I say, we are all united in the objectives we are trying to get in terms of value for the NHS and access to these top medicines, while at the same time creating a thriving ecosystem for drug and pharmaceutical companies to come here.
In conclusion, I thank the noble Lord, Lord Hunt, for bringing forward this debate. I am sure this is something that we will all enjoy and discuss further as the negotiations progress. I can assure noble Lords that this is very, very high on our priority list.