My Lords, I thank the noble Lord, Lord Warner, for his amendment and for the opportunity it has provided to have this discussion. I had a feeling that this one might lead to a wide-ranging debate that would probably go well beyond the remit of the Bill. Indeed, I had that sense when I had meetings with him and other noble Lords. I am grateful to the welcome that has been extended to me and I have been looking forward—if that is the right phrase—to having this opportunity to discuss the Bill.
It is worth stepping back for a moment as we start. I do not know whether the noble Lord, Lord Warner, will agree with the characterisation of this amendment by my noble friend Lord Lansley that it is more of a statement of intent than a concrete desire to change legislation. But, given that that is a decent characterisation, it is worth reprising what the Bill is trying to achieve. There is widespread support for many elements of the Bill.
We need to ensure that we have the right level of information to provide for three things: first, an accurate reimbursement of community pharmacies; secondly, information for price control schemes—and there are a variety of them, as we discussed—and, thirdly, the ability to get value for money and to ensure that, in relation to those instances that end up in the CMA, we are able to do something about them beforehand, because it takes a long time to get to that point. While it is important that that sort of back-stop provision is there—the big stick at the end of the road—ultimately, we do not want to get to that point, as it is an admission that we do not have the system right and have not controlled prices earlier on.
If those are the shared aims of the Bill, it is also important that we will the means. We cannot just say that we do not like these things and then not do anything about them. The question in regard to willing the means—and that is the main question about the Bill, and was so at Second Reading, when I listened as a Back-Bencher—is whether the provisions of the Bill are proportionate. That is the right question; “proportionate” can mean all sorts of things in different contexts, but it can mean proportionate in terms of the burden on firms, proportionate in terms of what it delivers in savings to the NHS, and so on. That is what sits behind many of the amendments that have been tabled by noble Lords, and we will have lots of opportunities to discuss them.
I think it is worth pointing out that the Bill does not introduce any new information requirements to the medical supplies industry, but rather clarifies the requirements and offers reassurances that provisions will be enacted only through regulation, which is a consultative process. Section 260 of the NHS Act 2006 already provides the Secretary of State with the power to make the medical supplies industry keep and provide information —the conception is that this has been extended to that industry. This power has not been used but, as we will discuss later, the instances where unjustified price rises have come about have happened in unbranded generics. That is one reason we are now acting as we are—because we did not have the power in advance. Of course, one can never anticipate all circumstances and instances in which that might happen.
I mention that only by way of a mini Second Reading debate and to reprise the purposes of the Bill and give background. It will also, I hope, give noble Lords an understanding that I know what the pressure points are and understand the balance that we have to draw between the two. As several noble Lords have pointed out, and following historical precedent, my particular policy brief does hold both the responsibility for a flourishing life sciences sector and for medicine pricing and regulation. I am acutely aware that those are two sides of the same coin and can be in tension with one another. The goal is to have a win-win situation in which the NHS gets good prices, new drugs come through the system and the life sciences industry feels that the United Kingdom is a place where it wants to do business. Pricing is one part of that, but there are lots of other factors, such as the ability to carry out clinical trials, R&D, the environment and so on.
While the Government agree with the underlying principles behind the amendment and the two arms of the legal duty, we are not convinced that a legal duty is the right approach. We recognise the vital role that the life sciences sector has in our economy. Thanks to the research and development efforts of the life sciences industry, which contributes £56 billion and tens of thousands of jobs to the UK economy every year, our understanding of diseases and the best way to treat them has improved dramatically over the past 20 years.
As several noble Lords have referenced, the Government launched today a UK-wide industrial strategy, which is a critical part of the Prime Minister’s ambition to build an economy that works for everyone.
It is not about picking winners but about making sure that we play to our strengths and build on the comparative advantages that we have. I am therefore grateful for the opportunity to talk about the commitment to the life sciences industry, which I know was one of the intentions of the noble Lord, Lord Warner, in tabling the amendment, and to re-emphasise the Government’s commitment.
The UK has one of the strongest and most productive life sciences industries in the world. Technology and commercial pressures are transforming the field of healthcare technology and the Government’s ambition, as set out in the life sciences strategy of 2011, is to anticipate and react to these changes while building on existing strengths. Innovation, funding for scientific research, aligned regulatory systems and access to the best people and talent all have a role in supporting a flourishing life sciences sector that goes beyond the prices paid for medicines and medical supplies.
In the context of the industrial strategy that was launched today, there will be a sector-specific life sciences industrial strategy to follow in due course. That will be an opportunity to make sure that we are able to address the concerns that exists in the life sciences industry, which are not peculiar to the Bill but are around, for example, the pricing environment and Brexit, which is a continuing concern. It may not always be popular to say so but it is the view of the Government that Brexit offers a number of opportunities as well as challenges. We will be seeking to make the most of those in our own regulatory system and in how we can provide exactly the kind of fertile ground that the life sciences industry needs to flourish in this country. There is a deep commitment to making that work.
I turn now to the second arm of the duty: making sure that the Secretary of State has regard to ensuring that patients have speedy access to NICE-approved medicines. We believe that this duty is also unnecessary. As noble Lords will know, NICE technology appraisals provides robust, evidence-based guidance for the NHS on whether drugs and other treatments represent a clinically effective and cost-effective use of NHS resources. NHS commissioners are legally required to fund treatments recommended in NICE guidance, usually within three months of the final guidance. This legal requirement is also reinforced in the NHS constitution as a right to NICE-recommended drugs and treatments.
We recognise that there is a remaining challenge in encouraging practitioners to use NICE-recommended treatments. The latest data from the innovation scorecard shows that the rate of uptake and utility of new medicines recommended by NICE are increasing. I acknowledge the picture indicating that we are lagging behind where we should be, so there is no complacency on that point. We are working to improve the scorecard to make it a more effective, accessible and useful tool to identify unjustifiable variation in the uptake of innovative new products.
The Government and their arm’s-length bodies are also taking forward a number of actions to improve access to, and uptake of, new medicines. The Medicines and Healthcare Products Regulatory Agency—the MHRA—has initiated an early access to medicines scheme, providing a platform to bring drugs that do
not yet have a licence to patients at a much faster rate than before. The scheme is making a real difference, as 25 promising innovative medicine designations and 10 positive scientific opinions have been awarded by the MHRA since the launch of the scheme in 2014. We also have the NHS test beds programme, which is supporting the testing and uptake of innovations across the NHS, and the accelerated access review, which has been published and which the Government will respond to as part of their industrial strategy.
I would also like to take the opportunity to address a number of points raised by noble Lords during this very informative and useful discussion. We will no doubt come back to these things on other amendments. We have talked about CMA fines and what we might do further upstream. There was a question mark over changes to the statutory scheme and whether there had been proper consultation. There will be further consultation on the implementation of the statutory scheme later this year, in addition to the consultations that have taken place. I should also point out that I intend to meet all the relevant industry groups, which I have not had the opportunity to do yet, to make sure that I hear first-hand about their concerns. I am endeavouring to do that in between Committee and Report so that we have the opportunity to have that personal dialogue—one that will reflect on the decisions we make today and on Wednesday about what the right approach is.
As the noble Lord, Lord Young, said, there is a case for action here. The question is always whether what we are doing is proportionate, so I thank him for that support. I was not aware of the issue about clinical pharmacology and will certainly look into it. If he and the noble Lord, Lord Hunt, would like a meeting about this to help me understand that better, I would be delighted. It is clearly an important part of having the right approach.
The work on antimicrobial resistance is being taken forward with great gusto by my colleague the Chief Medical Officer, Dame Sally Davies. She generously gave me a copy of her own book to read about that the other day—which I dutifully did, quickly, so that I could answer questions on it. We are putting forward a candidate to run the World Health Organization, Dr David Nabarro, who is deeply committed to this. We obviously hope that his candidature will be successful. I reassure the Committee that that work very much goes on.
The noble Baroness, Lady Finlay, asked about the nature of the pricing and control scheme. I am grateful to her for sharing her knowledge in a personal meeting. There is a tension between getting the right deal and disincentivising investment in the life sciences. It is always a fraught point—as my noble friend Lord Lansley said, every time we have one of these negotiations the balance is slightly different—but I am aware that it is an important balance to strike throughout.
I am grateful to my noble friend Lady Redfern for her support for the Bill and for the importance of driving value. We will have an opportunity to discuss ring-fencing shortly. I do not want to get ahead of myself on that, but we will address it. I had the great pleasure of working for my noble friend Lord Lansley
when the Conservative Party was in opposition and I know that he has been very committed for a long time to value-based pricing and getting a good deal. I am grateful for his knowledge on that. Again, we will have the opportunity to talk about those things in a group of his amendments, so I do not want to spend any more time on that.
The noble Baroness, Lady Masham, asked particularly about pricing differences in England and Scotland. I think that we will address that at a later point. There are differences in how drugs are priced according to packs versus units, the starting point and so on. The picture is quite good when you look at it in the round for particular products, but I would be delighted to discuss that with her further, if she wants.
Finally, on the questions raised by the noble Lord, Lord Hunt, I have tried to express again why we think that the Bill is necessary. The noble Lord talked about the open-ended nature of the Bill, which we will look at in amendments at the end of the process. Clearly, we do not want a declining UK sector or rationing. That involves, first, a proper life sciences industrial strategy, which we will have. I would like to think that that is not just the preserve of the governing party but something to which all parties would want to contribute. I look forward to working with noble Lords, who have tremendous experience in this area, to gain their ideas to help us with that.
We also need to drive access through the system. That is one part of an industrial strategy. It cannot be done just by diktat. We rightly put clinical decision-making at the centre of our system, but there are things that we can do beyond what we are currently doing to improve access, which I would be delighted to talk about and work on further with noble Lords as we draw out that life sciences strategy.
I apologise for the slightly long contribution, but I wanted to take the opportunity to respond to noble Lords and to set the scene. While we support the principles of the amendment on the duty, I do not believe that the aim is best achieved through having a legal duty. I ask the noble Lord to withdraw the amendment.
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