Drug Inflation Loophole Costing NHS Hundreds of Millions

Media reports have suggested that two brothers with NHS connections have been guilty of inflating drug prices in the health service.

Vijay and Bhikhu Patel, reportedly worth in the region of £700 million after beginning their business dealings with a single pharmacy located in Essex, have allegedly exploited a pricing loophole according to reports in both The Times and Daily Mail.

The press suggests that the two individuals have been involved in increasing the price of commonly utilised drugs in the NHS by as much as 12,500% in some cases.

This has enabled the pair to earn vast amounts of money, with the collective inflation of prices reckoned to be in the region of £260 million.

The companies owned by the Patels have been allowed to charge extortionate prices by simply dropping the brand name and using a generic name instead, allowing them to legally bypass NHS pricing cap rules.

Thus, such cases as a pack of steroid tablets which previously sold for 75p in 2008 being priced at £85 today, are indicative of the processes that the duo have been involved with.

As a part of this investigation into the issue, The Times newspaper has discovered that 32 medicines commonly utilised in the NHS have risen in price at least ten-fold over the last five years.

The £262 million that this is ultimately responsible for could be instead used to employ an additional 7,000 junior doctors on an annual basis.

Among the 32 drugs which have been identified as being seriously price inflated are the following:

– 10mg tablets of steroid Hydrocortisone – up by 12,500 per cent from 70p in 2008 to £85 in 2016.
– 50mg of anti-anxiety drug doxepin – up from £5.72 to £154 a packet since 2011.
– Cyclizine 30mg tablets, used to treat nausea – up from £9.57 to £353.06 a packet.

Several Members of Parliament have already been strongly critical of the practice, and there have been calls for Health Secretary Jeremy Hunt to permanently close this loophole.

Commenting on the issue, former Labour health minister Ben Bradshaw reflected that the news quite clearly had a negative financial impact on the NHS.

“These revelations are extremely alarming at a time of severe financial constraint on the NHS.”

Responding, a Department of Health spokesman was equally scathing, and it seems that an investigation into the subject is forthcoming.

“No pharmaceutical company should be exploiting the NHS. The Competition and Markets Authority is already investigating a potential abuse of generics pricing, and as part of a public consultation we have asked for views on government powers to limit the prices of generic medicines where there is no competitive market.”


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