Drug companies squeeze profits out of health

AN OFFICE of Fair Trading (OFT) report says that the NHS is paying the pharmaceutical companies hundreds of millions of pounds too much for drugs. The Department of Health buys £7 billion of branded medicines each year from the big drug companies.

The OFT says the NHS is not getting the best prices for drugs and recommends the overhauling of the Pharmaceutical Price Regulation Scheme that is supposed to set prices. Especially on drugs such as those to control blood pressure and cholesterol, it said, prices were significantly out of line with patient benefits.

Purchasing medicines takes up about a seventh of the NHS budget. The pharmaceutical companies are the most profitable sector in the economy, their rate of return dwarfing even those of the major banks or the oil industry.

As the NHS feature in the socialist issue 471, pointed out, the pharmaceutical giants "make an average 18% profit but do not reveal how much comes from the NHS. Increasingly they are linked at the top with Department of Health and Downing Street advisers."

OFT's report may get a warm welcome from the Treasury that wants to make big savings on the health service. However, there will be ferocious opposition from the drugs giants and also from their placemen in the government's ranks.

Socialists want an NHS that is able to carry out its vital work without shareholders' profits being the biggest concern. The pharmaceutical companies and other industries making profits out of the NHS such as the medical supplies industry, should be nationalised under democratic workers' control and management.