§ Mr. Patrick Jenkinasked the Secretary of State for Social Services what representations she has had about her proposals to increase the licence fees under the Medicines Act by 500 per cent.; what replies she has sent; and if she will undertake to phase the increase over not less than three years.
§ Dr. OwenI have received representations from the main associations representing the pharmaceutical industry to the effect that the whole or at least a major part of the cost of operating the licensing system should fall on general taxation and not on the industry. They also commented on the size of the increase and raised objections to certain features of the proposed scale. I have explained to them that the increase now proposed is consistent with the statement made in this House on 1st July 1971—[Vol. 820, c.193]—by the then Secretary of State for Social Services, the right hon. Member for Leeds, North-East (Sir K. Joseph) that at future reviews the scale of fees should be brought into line with the full costs of the licensing system, which are now £1.4 million. The size of the increase is due to the fact that, in the period of nearly five years since the announcement, the fees have remained unaltered, while costs have increased. In the circumstances I do not consider that any further deferment would be justified.
Certain modifications to the scales have been made in the light of the comments received. Fees will in future fall to be reviewed annually, and any further proposals the industry may have for further modifications can be considered in the course of consultation about the fees for 1976–77.
§ Mr. Patrick Jenkinasked the Secretary of State for Social Services what licensing fees are currently paid by medicine manufactured under legislation corresponding to the Medicines Act, in the United States of America, France, West Germany, Sweden, Switzerland and the 857W Union of Soviet Socialist Republics; and how these compare with the licence fees she is currently proposing for United Kingdom manufacturers.
§ Dr. OwenThe increases in fees now proposed do not distinguish between United Kingdom manufacturers and foreign manufacturers. They relate to the marketing of products in the United Kingdom. Comparisons with corresponding systems of control of marketing in other countries are difficult to make since in any case the patterns differ so much that specific comparisons cannot validly be made. Some countries rely wholly or mainly on a substantial initial fee, while the others annual fees are payable in respect of products on the market.
The information we have readily available, which may not be fully up to date, is as follows;
United States of America.—The legislation does not make any general provision for the charging of fees. Certain products are, however, subject to a certification system and the relevant regulations provide for fees to be equal to the cost of operating this system.France.—There is a registration fee for new products. It is understood that this is 2,000 francs (£220).West Germany.—The Bill now before the West German Parliament makes provision for an "admission fee"; it appears that this can in particular cases be as high as DM240,000—about £45,000. For drugs not falling in certain special categories there is a maximum of DM8,000—about £1,500—but this fee may be doubled if the admission procedure had given rise to exceptionally high costs. No annual fees appear to be charged.Sweden.—The general level of fees appear to be substantially higher than in the United Kingdom. There is an application fee of 6,000 KR, about £660, for all products while the corresponding United Kingdom fee is £60 in most cases or £1,800 in a minority of cases. There is an annual fee of 3,300 KR per product, about £360; the corresponding United Kingdom fee will be 0.25 per cent. of turnover.Switzerland.—There is a registration fee of 250 Swiss francs, about £50, for each pharmaceutical form. Registration has to be renewed every three years. For this there is a renewal fee of 200 Swiss francs—about £40.Union of Soviet Socialist Republics.—There is no published scale of fees.