Amendment 16 takes us to an issue that was the subject of consultation prior to the introduction of the Bill: whether the Government should take powers to control prices in circumstances where there has been an open and competitive process—for example, a tender process. We know that one reason why the legislation is required is because it does not follow that because products have become unbranded generic medicines they are necessarily available on a fully competitive basis in the marketplace. We have seen examples of that. In explaining the purpose of the Bill, it was stated that:
“The government’s intention is to use these new powers where due to a lack of competition in the market, companies charge unreasonably high prices for unbranded generic medicines”.
That is understood. There can be circumstances where there is a lack of competition.
Quite clearly, however, there are circumstances where the products available and the prices set are themselves the product of an open and competitive process, such as a tender process; for example, in relation to blood products being supplied to the NHS. There may well be a degree of market dominance in some of those, even though some of the complex medicines may be generic. For example, I know a company that produces medicines in circumstances where it has to use opiates, and the availability of those opiates might be limited.
None the less, if the NHS can procure on the basis of a tender that is open and competitive, why should the Government leap in and try to amend it? I understand that the response to that is to say that companies can take account of the rebate in the prices that they set. But surely when one enters into a tender, the companies concerned may not be in symmetrical positions in relation to the implications of the rebate. Some companies are indifferent to the rebate because they are not affected by it and other companies are affected by it. The nature of the rebate over a period of time and the extent of it may be variable, and they may make completely different assumptions about what that process looks like. So it seems, on the face of it, that a much cleaner approach to the Bill would be exemption from the price control mechanism in those circumstances where clearly the mischief that the Bill is intended to remedy does not apply: that is, in an open and competitive process. I beg to move.