Aditya Chakrabortty, The Guardian.
More than £3bn that could have been used for UK patients will go to big pharma for its branded products – money for care siphoned off for profit.
Of Arthur Scargill it was said that he began each day with two newspapers. The miners’ leader read the Morning Star of course, but only after consulting the Financial Times. Why did a class warrior from Yorkshire accord such importance to the house journal of pinstriped Londoners? Before imbibing views, he told a journalist, he wanted “to get the facts”.
In that spirit, let us parse a deal just struck by the governments of Donald Trump and Keir Starmer. You may not have heard much about this agreement on medicine, but it is huge in both financial and political significance – and Downing Street could not be more proud.
A “world-beating deal,” boasts the science minister, Patrick Vallance. It “paves the way for the UK to become a global hub for life sciences,” claims the business secretary, Peter Kyle, with the government press release adding: “Tens of thousands of NHS patients will benefit.”
Presented with such triumph, His Majesty’s press is up on its hindlegs. “Happy pills” ran a laudatory editorial in the Times, while the Daily Mail sportingly thanked Donald Trump for his “US lifeline for UK pharma”.
Britain 1, America 0! Except that’s not the view from Washington. “A major win for American workers,” says the trade secretary, Howard Luttnick, which “ensures that the breakthroughs of tomorrow will be built, tested, and produced on American soil.” The health secretary, Robert F Kennedy Jr, acclaims “results that put Americans first”.
One deal, two diametrically opposed readings: who is right? The answer, I regret to inform you, is the Trumpettes. Take this headline from the liberals at the New York Times: “To avoid tariffs, UK agrees to Trump’s demand to pay more for drugs”.
Starmer and his team have not only been handed a costly defeat; they are misleading you and me about what it means for our NHS, our future treatment, our lives.
Because modelling suggests this will almost certainly cost British lives. Before any agreement was signed, there was an estimate from the Office for Budget Responsibility (OBR) last month that branded medicines could soon cost the NHS an extra £3bn a year. That £3bn extra does not buy us anything – it is more money for the same medicines.
The health secretary, Wes Streeting, denies it will cost as much, but when I asked the Department of Health how he made those calculations I got no answer. I have also spoken to independent experts who think this brilliant deal will cost more, not less. For the sake of argument, let’s go with a cost of £3bn a year.
Reading between the lines of Streeting’s statements, this money will have to be found from the NHS’s own budget. That £3bn will be have to be found each year by giving fewer cancer scans, longer waits for ambulances and at A&E, and delays on surgery.
There appears to be no government assessment of what this means – and again neither Streeting’s ministry nor the Department for Science, Innovation and Technology were able to provide one. So I went to Karl Claxton, a professor at the University of York and an expert on the economics of NHS medicines. His modelling, based on years of evidence on the impacts of cuts to health budgets suggests that this deal, celebrated up and down Whitehall and hailed in the Times and the Daily Mail, will mean 15,971 more dead people every year. (If Streeting’s estimate is right, then the number of extra deaths will fall, although only as far as 6,192 – a comparative bargain.) They won’t know that they’ve died in the service of a deal that provides extra profits to some of the richest companies in the world but Claxton’s view is that the link is “causal”. This deal, he says, is “a catastrophe for all NHS patients”.
This is quite possibly the first time you’ve read about this agreement and what it means. Just as with the AI deal stuck by Starmer a few weeks ago, there is no paperwork, no official evidence, no vote attached to this. All you have is a Whitehall press release. While national newspapers have been keen to cover the resident doctors’ pay dispute, with 76 stories over the past month according to the Guardian’s research department, they have devoted only 13 stories to this deal, which in financial terms is far bigger.
It also represents a larger threat to our medical system. Unlike the disaster capitalism that reigns over much of US healthcare, the NHS tightly regulates approved drugs, to ensure they offer value for money and that manufacturers do not rake off too much profit. The result is that pills and injections in the US are on average three times more expensive than in the UK. For an object lesson in how to use the power of the public sector to reduce the cost of essentials and attack profiteering, look no further than the NHS’s drug regime. No wonder the pharmaceutical industry hates it.
Its best chance of undermining it has come with Trump’s return to the Oval Office. After promising voters he would lower the cost of living and create more jobs, he demanded pharmaceutical companies invest more in the US and charge Americans less for their medicine. He has also slapped tariffs on the goods the rest of the world sells to the US, which includes a few billion-pounds-worth of British-made serums and tablets. And so Downing Street was set on a collision course with AstraZeneca, Merck and other billion-pound businesses.
Things came to a head in the middle of September, with an extraordinary sequence of events. First, Merck scrapped plans for a research centre in King’s Cross, north London, even though it was already under construction. On the same day, the industry’s main lobby group warned about the relatively low prices paid by the NHS for medicines, saying that “in many global boardrooms, the UK is now viewed as a contagion risk with practices that, if adopted by other markets, would threaten the sector’s ability to invest and innovate globally”. Within 24 hours, Eli Lilly, maker of Prozac and Mounjaro, appeared in a trade journal pulling plans for a lab already agreed with the government. Its boss later slammed the UK as “probably the worst country in Europe” for drug prices. The next day, AstraZeneca paused a project in Cambridge that was supposed to create 1,000 jobs.
These announcements “look very coordinated from the outside”, one senior government official confided to journalists. “I’ve never seen anything like this before, it’s actually pretty sinister.” The Association of the British Pharmaceutical Industry denies any claims of collusion.
And so we end up with a deal that has barely been explained to the people whom it will most directly hurt. Meanwhile, we have a government hailing as a victory what is actually a singular and costly capitulation, and holding on to lame promises that these drugmakers will invest in the UK. As Sally Gainsbury of the health thinktank the Nuffield Trust says, it is now “part of a Ponzi scheme, buying treatments that aren’t the best use of money”.
An organisation devoted to saving lives is now being used as part of trade deals, its precious resources and structural integrity haggled away to multinational companies and foreign bullies. Labour never ceases to remind voters that it gave them the NHS, yet in chasing the unicorn of fabulous economic growth its leaders are now changing the very purpose of its proudest creation.
