Drug firms force up NHS spending

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The Independent Online
PHARMACEUTICAL companies have raised the prices of medicines routinely prescribed by doctors by up to 1,000 per cent over the past year. The move has already cost the National Health Service millions of pounds.

The price rises follow govern-ment efforts to reduce the NHS drugs budget. Earlier this month, the Health Secretary, Frank Dobson, announced a deal with drug companies to cut prices for prescription medicines by 4.5 per cent, in an attempt to save the health service pounds 200m a year.

But the Independent on Sunday can reveal that this agreement only covers the cost of brand-name drugs. Drug companies have boosted the price of cheaper alternatives, known as "generic" drugs, to compensate for the reduction in profits on these top-name medicines.

Among the generics which have soared in price are four major antibiotics and tranquillisers: thyroxine, chlordiazepoxide, erythromycin and warfarin.

Last night, Labour MPs called for an urgent inquiry into pharmaceutical companies which they allege are "holding the NHS to ransom" over pricing.

The Department of Health last year ordered doctors to use the cheapest form of medicines available rather than brand-name drugs. For example, instead of prescribing Ventolin asthma inhalers, GPs were urged to give patients the cheaper drug salbutamol.

The Government's aim is to reduce the NHS drugs bill, which has increased by 40 per cent or pounds 1.5bn since 1993 and now totals pounds 5.2bn - 13.7 per cent of all NHS spending.

But a survey by the Independent on Sunday shows extravagant price increases among the cheaper alternatives too.

A pack of thyroxine tablets, which are prescribed to thousands of thyroid sufferers, has risen from pounds 2.99 last year to pounds 44.89 this year.

The tranquilliser chlordiazepoxide has risen from pounds 6.84 to pounds 23 for 500 capsules. And the antibiotic erythromycin has increased in price in the past year from pounds 4.12 to pounds 11 for a pack of 100.

Louise Ellman, MP for Liverpool Riverside, last night called on Frank Dobson to bring drugs companies under control. "The drugs pricing market is obviously not working," she said. "At a time when we seek value for money in the NHS, it is important that drugs spending comes under closer scrutiny."

But the companies marketing these drugs believe the price increases are justified. Norton Healthcare, one of the manufacturers of thyroxine, said generic drugs such as thyroxine were still cheaper than branded drugs for the NHS.

"The margins are lower with generic drugs," said the company's marketing manager, Chris Doyle. "Any small increase in the cost of production is then reflected in the cost of the drug, but the NHS still saves millions by buying generic drugs. It is still less than the cost of a branded drug."