In the snap election that was never supposed to happen—Prime Minister (PM) Theresa May having ruled it out no less than five times—the three main parties have now published their manifestos. Each are putting forward their stall before Election Day on June 8. So what could be in store for industry, depending upon whether the new Government is Blue (Conservative), Red (Labour) or Yellow (Liberal Democrat)?
Brexit is everywhere and naturally features heavily in the Manifestos of the three main parties. Brexit is a key issue for industry. After all, the UK coming out of the European Union (EU) affects them from marketing authorization through to supply, as well as whether, for those who already have significant activities in the UK, to stay or go.
Smooth and orderly departure, fresh start to negotiation, or another referendum
The Conservatives want to deliver a smooth and orderly departure from the EU. Without any sense of irony, they call for Britain to stay strong and united. That seems to ignore the close cut nature of the referendum to leave the EU that left the UK more divided than in many people’s memories. It ignores too the reality in health care: an increasingly diverse NHS across the devolved nations and with decentralization of health to areas like Manchester, even within England, for the pharmaceutical industry to navigate.
Labour say that they will respect the EU referendum outcome but they’d start again and set out new negotiation priorities. Staying in the Single Market and the Customs Union are central to Labour’s intentions for the post Brexit future for the UK. For pharma, of note and reassuring is the explicit mention of maintaining a relationship with the European Medicines Agency (EMA). Labour say that leaving the EU with no deal is the worst possible outcome; that is in direct contrast to the Conservatives whose view is that no deal is better than a bad deal.
The Liberal Democrats (Lib Dems) take a very different approach to Brexit to both the Conservatives and Labour, suggesting instead that the terms of the Brexit deal should be put to the people in another referendum. The Lib Dems also take a very different approach to their Manifesto: it’s not about winning the General Election but instead putting the Lib Dems into a strong position of opposition. They think they can do better than Labour has done so far in opposition to the current Conservative government. (Perhaps this is some refreshing honesty in a world otherwise full of political spin?) They also say that they won’t go into Coalition with either the Conservatives or Labour, suggesting once burned twice shy following their experience of Coalition Government from 2010 to 2015.
Desire for collaboration on research with Europe
The Conservatives want to continue participating in European collaboration in science and innovation. Labour say that they want to stay part of Horizon 2020 – the biggest EU research and innovation program ever – as well as welcoming research staff to the UK. The Lib Dems also see the importance of science and research funding from the EU, echoing Labour in wanting to retain access to Horizon 2020.
But the reality is that no UK Government—of whatever color—can deliver such involvement in research with Europe on their own. It will be up to the Member States if they’ll want to collaborate too. No words will be sufficient to offset the uncertainty that Brexit brings to the pharmaceutical industry: only quick decision-making can help.
More funding for the NHS, but will it be enough?
The Conservatives cite an ageing society as one of the five giant challenges facing the country; acknowledgement that the NHS—and these days social care too—are key issues amongst voters. The plan is to deliver exceptional healthcare, whenever, wherever, delivered by an NHS with the money, buildings and people it needs. A big promise when the NHS has been loosening targets because they can no longer achieve them, and all this while under the current Conservative Government. Will the Conservative promise of giving the NHS a minimum of £8billion over the next five years, be enough?
Labour too cite the NHS in the Leaders foreword, with the emphasis on restoring the NHS to its place as the envy in the world. Their vision is one where the NHS will give patients the modern, well-resourced services they need for the 21st century. That includes familiar targets such as access to treatment within 18 weeks and delivering the Cancer Strategy in England in full by 2020. Labour also commit £30 billion in extra funding over the next Parliament. They’ll fund this from higher tax on the highest earners and higher tax on private medical insurance as well as halving fees paid to management consultants.
The Lib Dems are more emotive in their approach to the NHS. They want to save the NHS and social care. Their plan would be to raise more funds through an extra penny in the pound on income tax. In the long term they are also calling for a dedicated health and care tax.
This means that all the main parties say that there will be more money for the NHS. Pressure on the pharma industry is unlikely to ease though: the pharma industry will still have to make the case for the value of new medicines. That’s because there is probably not going to be enough to go around in the next five years whoever comes into power.
Turning back the clock on the NHS reforms
If Labour come in, much hard work by industry in (trying to) work with the NHS locally may slow at best, or halt at worst. That’s because Labour want to repeal the Health and Social Care Act (2012) that introduced the current architecture as well as introduce a new quality, safety and excellence regulator: NHS Excellence. Unclear is how the current regulators and arm’s length agencies, including the National Institute for Health and Care Excellence (NICE), will fit into this potential new landscape.
The importance of industry recognized through industrial strategy
The Conservatives signal the importance of industry generally by including reference to a modern industrial strategy in the foreword by the PM. A clear link is made between a strong economy and investment in the NHS as well as other public services. That’s echoed in the first of the PM five giant challenges: the need for a strong economy. There’s talk about identifying the industries that are of strategic importance: the life sciences industry is one of these. Welcome will be the commitment to ensuring the workforce has technical skills. Similarly will be the ambition for the UK as the most innovative country in the world although there will (rightly) be a credibility issue here: the UK lags behind many other countries in adoption of some new medicines, some of which are seen as innovative.
Labour too see the importance of talking about industrial strategy, setting the ambition of the UK being an innovation nation. In practical terms, that means meeting the OECD target of 3 per cent of GDP spent on research and development (R&D) by 2030. Again there’s emphasis on strategic industries with Labour putting forward the idea of a council that can oversee security and growth. The idea isn’t new, and in life sciences there are forums already in place including the Ministerial Industry Strategy Group (MISG), although the degree to which they actually work is up for debate.
The Lib Dems also place emphasis on an Industrial Strategy and they want to see more ‘catapult’ innovation and technology centers.
Industry features in the Conservatives fifth giant challenge: fast-changing technology and how it can be harnessed. This dovetails to a degree with plans to make the most of digital technology which is already changing how pharma works with patients, sets up and runs trials and does real world data and evidence. A new digital charter will be set up too. The discussion on the charter doesn’t cite life sciences, but must surely include them if the Conservatives are both successful in the Election, and do what they say they will do.
There’s the merest nod to digital in Labour’s Manifesto with the intention to appoint a Digital Ambassador to promote Britain to tech companies. The Lib Dems demonstrate that they have been paying attention to digital too with references to machine learning and artificial intelligence.
Where NHS and industrial strategy meet: the Accelerated Access Review
The Conservatives re-iterate a 2015 Manifesto commitment saying that they will implement the recommendations of the Accelerated Access Review (AAR). The hope is that this will speed up patient access to new drugs and treatments whilst also getting value for money. Again though, there’s a credibility gap. The AAR took a very long time to be published, and by then it got the most cursory response from Government. A full response hasn’t yet been given.
Even if the AAR is implemented, the focus on innovation will likely take a backseat as the Conservatives also plan to introduce a new GP contract and a reformed contract for Consultants. That’s brave since there’s been a tumultuous relationship between NHS staff and the Secretary of State for Health, Jeremy Hunt. Perhaps the plan is for a new Secretary to come in if the Conservatives stay in power? If that’s the case, it would also mean a new Secretary of State at the same time as the Pharmaceutical Price Regulation Scheme (PPRS) – a voluntary agreement between industry and the Government on pricing of branded medicines – is negotiated. The current PPRS ends on the 31 December 2018.
Labour recognize the issue of access to medicines in their Manifesto, although they don’t cite the AAR. They want to tackle what they describe as a problem of rationing of services and medicines. That may also mean a new approach to pricing and reimbursement since they talk about fast access to the most effective new drugs and drugs whilst also insisting on value-for-money agreements with pharma companies. Maybe the Office for Budget Responsibility for Health will play a role? Labour say that their new agency will oversee health spending and scrutinize how it is spent. Medicines may only be around 10 per cent of NHS spending, but it’s high profile and easy to identify.
Corporate tax: Lower, higher, or staying the same
The Conservatives say that they will stick with their current plans to lower corporate tax to 17 per cent by 2020. That might sweeten the deal for some companies, but will it be enough to stop a Brexit-brain drain?
Labour take the opposite stance: large corporations will pay more. The sweetener appears to be that some of this will be invested in education and skills, not likely to be seen as sweet enough in today’s globalized world. The Lib Dems would keep corporation tax at 20 per cent.
Roll on June 8
There is a sense that many in the UK are more than a little fed up with politicians and politics with recent history of voting in the UK feeling like a rollercoaster. The same is arguably true within industry, and many will be relieved when the results come in after the 8th June. No party is offering the certainty that the pharma industry desires. Many will want to just get the Election out of the way and get on with the business at hand, not least getting the most out of the AAR and the best successor with the PPRS, and all that under the specter of Brexit.