Pharmaceutical Firms (Research)

Oral Answers to Questions — Ministry of Health – in the House of Commons at 12:00 am on 20th July 1959.

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Photo of Dr Donald Johnson Dr Donald Johnson , Carlisle 12:00 am, 20th July 1959

asked the Minister of Health whether he has taken note of the comments of paragraph 226 of the Report of the Hinchliffe Committee in which a distinction is made between pharmaceutical firms which undertake genuine research and those which make large profits on new preparations, which are not therapeutically superior to those already in existence, and devote no part of their profits to significant research; and what steps he is taking to make pricing arrangements with the pharmaceutical industry so that the fullest encouragement is given to firms which embark on genuine research expenditure

Photo of Mr Derek Walker-Smith Mr Derek Walker-Smith , Hertfordshire East

Yes, Sir. As my hon. Friend will know, the Committee recognised that the present price agreement, which is in operation for a trial period, has features which allow for the need to encourage research. This agreement is at present under review, and in considering the arrangements for the future I shall certainly keep in mind the importance of encouraging genuine research.

Photo of Dr Donald Johnson Dr Donald Johnson , Carlisle

I thank my right hon. and learned Friend for that reply. Will he press the matter vigorously, because the same paragraph gives some rather striking figures to the effect that, whereas £7 million annually is spent on research in Switzerland and £43 million is spent in the United States, only £4 million is spent in this country. Does he agree that there is a need for a fundamental change in this country to make up this kind of difference in the figures?

Photo of Mr Derek Walker-Smith Mr Derek Walker-Smith , Hertfordshire East

We have, of course, to have regard to the findings of the Report as a whole. The possibility will certainly be explored in the review now in progress of relating permissible prices more directly in some way to a firm's research effort in any future scheme. This is a complex matter involving many considerations.

Photo of Mr Julian Snow Mr Julian Snow , Lichfield and Tamworth

In giving that answer to a Question which refers to "genuine research", has the Minister had in mind fundamental basic research or development research, which is a very different matter? What weight does he give to the fact that certain companies market pharmaceutical supplies at very high prices in this country when the basic research has been done abroad?

Photo of Mr Derek Walker-Smith Mr Derek Walker-Smith , Hertfordshire East

The basic research of, for example, subsidiaries of United States companies is very often, of course, carried out in the United States. That is one of the complicating factors. As the hon. Gentleman knows, the present agreement does not directly relate prices to research. The possibility of relating them more directly is one of the things being taken into account in our present review.