The Pharmaceutical Price Regulation Scheme (PPRS) is the mechanism used by the

UK Department of Health The Department of Health and Social Care (DHSC) is a department of His Majesty's Government responsible for government policy on health and adult social care matters in England, along with a few elements of the same matters which are not otherwi ...

to ensure that the

NHS The National Health Service (NHS) is the umbrella term for the publicly funded healthcare systems of the United Kingdom (UK). Since 1948, they have been funded out of general taxation. There are three systems which are referred to using the " ...

has access to good quality branded medicines at reasonable prices. It involves a non-contractual agreement between the UK Department of Health and The Association of the British Pharmaceutical Industry (ABPI). The scheme applies to all branded, licensed medicines available on the NHS. The purpose of the scheme is to achieve a balance between reasonable prices for the NHS and a fair return for the

pharmaceutical industry The pharmaceutical industry discovers, develops, produces, and markets drugs or pharmaceutical drugs for use as medications to be administered to patients (or self-administered), with the aim to cure them, vaccinate them, or alleviate symptoms. ...

. The current PPRS scheme, using a

value-based pricing Value-based price (also value optimized pricing and ''charging what the market will bear'') is a pricing strategy which sets prices primarily, but not exclusively, according to the perceived or estimated value of a product or service to the customer ...

mechanism, came into effect on 1 January 2014, to run for no less than five years. It replaced an earlier scheme running from 2009 to 2013. In December 2014

Hoffmann-La Roche F. Hoffmann-La Roche AG, commonly known as Roche, is a Swiss multinational healthcare company that operates worldwide under two divisions: Pharmaceuticals and Diagnostics. Its holding company, Roche Holding AG, has shares listed on the SIX ...

successfully appealed against a decision of the National Institute for Health and Care Excellence appraisal committee in respect of Kadcyla on the basis that it should have considered that under the scheme, the industry had agreed to cap growth in the drugs bill to 0–1.9% a year for the next five years. Roche said this had "fundamentally changed" the nature of how NICE should consider cost effectiveness. On 23 August 2017, the UK Government launched
consultation
relating to the PPRS, following legislation that was recently passed.

Purpose and objectives

As the primary buyer of medicines in the UK, the Department of Health has an interest in ensuring medicines are available at reasonable prices. However it is also important that pharmaceutical companies, represented by the ABPI, are able to maintain sufficient levels of

profit Profit may refer to: Business and law * Profit (accounting), the difference between the purchase price and the costs of bringing to market * Profit (economics), normal profit and economic profit * Profit (real property), a nonpossessory intere ...

and

competitiveness In economics, competition is a scenario where different economic firmsThis article follows the general economic convention of referring to all actors as firms; examples in include individuals and brands or divisions within the same (legal) firm ...

to enable them to invest in sustained

research and development Research and development (R&D or R+D), known in Europe as research and technological development (RTD), is the set of innovative activities undertaken by corporations or governments in developing new services or products, and improving existi ...

. The 2009 PPRS agreement outlines its primary objectives as to: # Deliver value for money # Encourage innovation # Promote access and uptake for new medicines # Provide stability, sustainability and predictability

Patient access schemes

The 2009 PPRS agreement allows for patient access schemes. These allow for the provision of a drug which would not otherwise be supported by

NICE Nice ( , ; Niçard: , classical norm, or , nonstandard, ; it, Nizza ; lij, Nissa; grc, Νίκαια; la, Nicaea) is the prefecture of the Alpes-Maritimes department in France. The Nice agglomeration extends far beyond the administrative c ...

and available on the NHS due to insufficient evidence of its

cost-effectiveness Cost-effectiveness analysis (CEA) is a form of economic analysis that compares the relative costs and outcomes (effects) of different courses of action. Cost-effectiveness analysis is distinct from cost–benefit analysis, which assigns a monetar ...

. Patient access schemes can be either financially based or outcome-based. Financially based schemes are where the company does not alter the

list price The list price, also known as the manufacturer's suggested retail price (MSRP), or the recommended retail price (RRP), or the suggested retail price (SRP) of a product is the price at which its manufacturer notionally recommends that a retailer ...

of the drug but offers discounts or rebates linked to numbers or types of patients treated, response of patients treated, or the number of doses required. Or, alternatively, the company may alter the list price. Outcome-based schemes take place when a company agrees to a later increase in price, or a rebate, once the value of the drug has been proven. Alternatively risk-sharing agreements can be put in place whereby outcomes are measured and price adjustments take place accordingly.

References

{{Reflist Pharmaceutical industry in the United Kingdom Pharmaceuticals policy Pharmacy in the United Kingdom National Health Service