Governing in the era of Donald Trump has been Labour’s miserable misfortune. As our prime minister and king grovel to the global bully with royal folderol this week, we will probably feel the full humiliation of the would-be American king.
The recent blow to British life sciences is a brutal example of our serfdom. Trump’s threat to put a 250% tariff on medicines made abroad by pharmaceutical companies, unless they move their factories, research and legions of jobs to the US, is driving out the UK pharma industry. What’s to stop him? AstraZeneca has ditched a £450m vaccine plant in Liverpool. In a shock announcement last week, the US drugmaker Merck axed a half-built, £1bn London research facility next to the Crick Institute it was destined to work with. Eli Lilly is pausing investment in the UK while Novartis is understood to be “keeping its investments under review”.
Trump’s other objection is Europe paying lower prices – and especially the NHS – for drugs that can cost three times more in America: his executive order demands that the US gets the lowest prices. He protests about America “subsidising socialism aboard [sic] with skyrocketing prices at home”. Negotiations between the health secretary, Wes Streeting, and drug companies about fair prices have collapsed. This time, the pharma industry is backed up by presidential threat. Often reviled as capitalist beasts in the green pastures of the NHS, this year drug companies have a point: their voluntary agreement to pay a percentage of their income on sales to the NHS leapt from 15% to 23%. Streeting offered an extra £1bn to help ease that cut in profits, but they balked, and he temporarily walked, saying: “I won’t allow big pharma to rip off our patients or taxpayers.” Cheers all round.
As a case study in the fiendish dilemmas of governing, NHS drug pricing is a special circle of hell. Life sciences are crucial to Labour’s growth mission and industrial strategy, and this is an area in which the NHS, private companies and universities should be working together. The life sciences sector plan, released in July, pledged “to make the UK the most attractive place in the world to develop and deploy new treatments and by 2030, the UK will be one of the top three fastest places in Europe for patient access to medicines”.
How much should the NHS pay for drugs to keep these companies on board? And who pays – an overspent NHS, the business and trade department, which oversees industrial strategy, or the Treasury, which needs growth? Britain can rightly boast that it is best placed for drugs research: the NHS has unique, easy to use, centrally collected data. In Britain, drug companies sell to the whole country through one NHS portal, rather than a profusion of private outlets as in the US.
But big pharma is forever on the warpath against the National Institute for Health and Care Excellence (Nice), the UK’s system for assessing the true worth of new treatments. Nice was a great legacy of the last Labour government, setting a maximum price the NHS should pay at around £30,000 per patient for a good year of life, with some flexibility for exceptions and trials. But that unchanged limit means its value has eroded by half over 20 years due to inflation, the companies complain. Big pharma hates this gatekeeper whose judgments are widely used around the world: when Nice says no, a new drug struggles everywhere.
Fighting back, companies have even poured money into disease advocacy campaigns, funding patients to lobby for drugs that Nice has refused. The latest example is two Alzheimer’s disease drugs, lecanemab and donanemab, which Nice has not approved. Manufacturers warn this decision will limit access to private patients. The Alzheimer’s Society called it “highly disappointing”, while the Telegraph joined the call to unblock “the use of two wonder drugs on the NHS”. Yet experts point to Nice evidence showing that the benefits experienced by patients were “too small to be noticeable”, at the cost of a nurse’s salary for an annual course of treatment.
Industry leaders warn that the NHS’s low prices and strict Nice controls are making Britain “un-investable”. They claim that the NHS under-prescribes medicines, spending 9% of its annual budget, compared with Spain’s 18%. But is that a bad thing? Ahead lies an explosion of new drugs and vaccines: some will save the NHS, but some, such as genome sequencing for every baby, which aims to identify rare and treatable genetic conditions early, will ignite huge demands to treat slight risks.
There are bigger questions. Prevention is a Streeting priority, but this is politically near impossible when the public measures success by waiting lists and extra treatments. New research in the Lancet questions drug spending: analysing all new NHS medicines over 20 years, researchers find the money spent on average would have bought more good years of life if it was spent on improving existing services. How is a health secretary supposed to respond? Surely not by banning new drugs, nor by letting drug research die.
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Here’s an even bigger question. The NHS consumes around 20% of all public spending, which is surely enough before it devours everything else. All evidence shows that good health depends on a good society and decent lives more than beds and prescriptions. But discussion of capping the NHS is politically unthinkable.
That’s the hell of governing, whoever is in power. The NHS needs cheap drugs and the economy needs a thriving pharmaceutical industry making profits. The health department now holds its breath on the US state visit, fearing a renewed Trump assault on the NHS, multiplying drug costs and disaster for life sciences. That’s just one more reason why, wincing and ashamed, we shall watch our government grovel, despite Gaza, despite Ukraine, as Trump sweeps in, his whim and will unknown.