Since Donald Trump first let slip that he wanted the NHS to be “on the table” in any trade deal with the US after Brexit, debate has raged on exactly what might be up for grabs as a result.
On 27 November 2019, The Labour Party revealed 451 pages of documents from US-UK trade talks that showed that the NHS is on the table in trade talks and said it was “up for sale”. The Labour Party leader said the uncensored papers gave the lie to Boris Johnson’s claims that the NHS would not be part of any trade talks. The talks covered many subjects, but for the NHS the key parts covered patents and US companies wanting total market access to the NHS. The documents cover six rounds of talks in recent months.
Concerns that the NHS will become part of any post-Brexit deal with the US were highlighted by the recent Channel 4’s Dispatches program, which revealed that five secret meetings have already been held between senior civil servants and US drug companies ahead of a potential trade deal; one of these meetings was after Boris Johnson became Prime Minister.
The Dispatches program sent Matt Hancock scurrying around the media saying the NHS is not for sale in an attempt to limit the programme’s damage. Despite the denials and previous statements from PM Johnson and Trade Secretary Liz Truss the new evidence only served to raise speculation that NHS would be part of the trade deals.
It is probably true that flogging off the whole NHS was always the least likely outcome: there are so many parts of the NHS that US corporations seeking profits would find unattractive. The passing of the Health & Social Care Act 2012 meant that US corporations were free to bid for contracts to run NHS clinical and support services, but since then not many of them have done so.
Focus on drug pricing
What US negotiators are most likely to focus on is other highly lucrative areas, most notably the pricing of medicines – seeking to dilute or remove the agreement with the pharma industry under which the NHS caps its expenditure on branded medicines, paying far less than in the US. It is no secret that Trump wants other countries to pay higher prices for drugs developed in the USA. The Dispatches programme reported that drug “price caps” were discussed in at least one of these meetings.
A report by the NHS Confederation, which represents most hospital trusts in England, warns that the NHS could face a much larger bill for drugs and be denied the chance to use cheaper alternatives to expensive branded products, if any post-Brexit deal eliminates or waters-down the current agreement between our government and the pharma industry on drug pricing.
This agreement is the voluntary pricing and access scheme (VPAS), which caps the total bill the NHS has to pay for drugs. The vast majority of pharmaceutical companies who operate in the UK sign up to this agreement, so if it were abolished or watered-down then the price of all branded drugs, not just those from US pharma, would rise leading to a much higher bill for the NHS.
NHS could have to pay an extra £500m per week
The exact size of the higher bill to the NHS is unclear, as nobody can predict exactly what any new agreement would contain, however in the Channel 4 Dispatches programme, the figure of an additional £500 million a week was quoted. This figure was calculated by Dr Andrew Hill from the University of Liverpool, a drug pricing expert and adviser to the World Health Organization. It is what the NHS would have to pay if it had to pay US prices for all the drugs it buys.
Dr Hill’s report for Dispatches notes: “We can thus crudely estimate that if prices of medicines in the UK were equal to prices in the US, NHS England pharmaceutical expenditures in 2017/18 would have been an additional £27 billion annually or about £519 million per week.”
Delays to accessing cheaper drugs
The other issue that would increase costs for the NHS are that the US pharma giants would like to strengthen intellectual property rights for companies who hold patents and data about the drugs they market. Once patents end, the drugs can be manufactured by numerous companies and are sold much cheaper as generic drugs; any changes to patents will delay the sale of generic drugs to the NHS, increasing costs.
There is also the threat that the pharma industry might push for access to the NHS’s unique database of 55 million patient records, which has been estimated to be worth £5 billion per year to private companies. Consultancy.uk has highlighted a recent paper from professional services giant EY which claims that the NHS could tap into a vital source of funding by opening up its patient records to private entities.
Would NHS services be a target?
In the area of services, a recent article by Kate Ling of the NHS Confederation points out, that even operating on World Trade Organisation (WTO) terms after leaving the EU without a deal won’t force commissioners to invite bids from overseas companies to provide NHS services:
“It will be for the Government of the day to choose, when negotiating, what kind of services foreign providers can bid to supply.”
This will not fill many campaigners with confidence. Of course the driving force so far in privatisation of NHS services has been the British government, whether that was New Labour from 2000, David Cameron supported by Lib Dems from 2010, or Tory governments since 2015.
The NHS Confed would like to see government action (changes in the law) that would “Ideally, exclude publicly funded healthcare services completely from the scope of a future free trade agreement (FTA).
“Or, if they are within scope, explicitly exempt them from commitments that would, for example, oblige the NHS to allow the trading partner’s companies to bid for NHS business….”
However the Confed says it is happy to allow commissioners to choose to put services out to tender.
In other words even if we can keep the Americans at bay, the real challenge in pressing to keep our NHS intact is to stop our own home grown CCGs and Trusts choosing to put more NHS services out to tender.