§ Mr. Joel Barnettasked the Secretary of State for Social Services without giving either the names of imported drugs or the manufacturing companies, if he will give the number of cases being investigated by his Department as to possible excessive profits being made; by what general criteria he measures excessive profits; whether he is satisfied with his existing powers to deal with these matters; what action he is taking; and if he will make a statement.
§ Mr. AlisonThe possibility of excessive profits is investigated by regular review of the financial position of all major companies supplying drugs, imported or otherwise, but the fact of the review does not necessarily mean that excessive profits are being made.
As to criteria, we have to try and satisfy ourselves that the prices charged to the National Health Service for all pharmaceutical products are fair and reasonable, and that this industry is strong, efficient and capable of the research and development necessary for new medicines. To do this we have to look at each individual company as a whole, including its performance at hone and overseas, its research activity both now and in the past and compare it with the performance of other companies. Such a situation does not readily lend itself to specific criteria for costs or profitability and we are in discussion with the industry about these matters and whether we are achieving our objectives in the best way.