David Wighton: Business commentary
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The Government giveth to the pharmaceutical industry, and the Government taketh away. At the moment, it seems to taketh away rather more.
Lord Jones of Birmingham, the Trade Minister, yesterday unveiled a strategy board to promote the UK’s expertise in healthcare.
The board is a key part of the strategy launched by Lord Jones last year to highlight the UK’s world-leading position in life sciences and to help to combat growing competition.
Now, I am not saying the UK LifeScience Marketing Strategy Implementation Board is a bad thing. And the name is a beauty. Chris Brinsmead, the head of AstraZeneca UK, who will be chairman of the new body, says that it can make a real difference.
The problem is that while one hand of government is supporting the patient, the other is trying to pick its pocket.
In February, the Department of Health, headed by Alan Johnson, said it was scrapping the current pricing deal for prescription drugs half way through its five-year term.
Officials are said to have kicked off the negotiations on a new deal by arguing for 10 per cent price cuts. For a government that emphasises the importance of economic stability for the encouragement of investment, this sits a bit oddly.
Meanwhile, the Department for Innovation, Universities and Skills, has been urging other arms of government to promote innovation.
Yet, the NHS is slow to pick up innovative drugs and is getting slower, leaving the UK behind the rest of Europe in the use of new medicines. Against this background, it is hardly surprising that the industry is nervous. In a recent survey by the CBI and the Association of the British Pharmaceutical Industry, 97 per cent of companies polled said there was increased uncertainty in the UK. More than a third said that they were planning to cut spending on research and development.
There are plenty of other reasons why the industry is cautious. But a more joined-up government approach could prevent serious damage to one of Britain’s most successful industries.
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