A subtle version of fiscal drag has seen the amount the NHS is prepared to spend on treatments reduce in real terms, meaning patients are missing out on life-saving treatment and the economy is missing out on investment, says Gareth Lyon

The UK government has spent decades testing the limits of just how far industry can go in discounting prices for innovative medicines in the NHS. Recent industry news shows that the sector was not bluffing when it talked about the potential impact on investment in this country.

Several of the world’s largest pharmaceutical companies have paused or pulled investments in the UK, citing market access and pricing as major issues. Meanwhile other European countries such as Spain and Poland have been actively courting pharmaceutical investments and making life as easy as possible for them.

There has been a lot of discussion about the crucial multi-year industry pricing agreement, VPAG (The Voluntary Scheme for Branded Medicines Pricing, Access and Growth) which seeks to limit NHS spending on innovative medicines. With negotiations dragging on, industry has faced incredible frustration and uncertainty impacting a large part of the UK market.

But this is not the only mechanism limiting NHS use of potentially life changing medicines. The value-based........

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