(Reuters) - UK's pharmaceutical trade body on Thursday called for the government to scrap its plans to raise the repayment rates for drugmakers, to avoid possible setbacks in the sector.
Drugmakers that are part of UK's voluntary scheme agreement, which makes branded medicines affordable for people, are required to pay a part of their drug revenue to the government. The Department of Health and Social Care plans to raise the revenue clawback rate to 27.5% from 24.5%.
The country's ongoing attempt to raise rates is likely to send the "worst possible signal" to global investors and boardrooms, said the Association of the British Pharmaceutical Industry (ABPI).
"Hiking these clawbacks to such uncompetitive levels risks undermining the UK's offer to global life sciences companies," Richard Torbett, chief executive of the ABPI, said in a statement.
Pharmaceuticals giants AbbVie and Eli Lilly withdrew from the UK's voluntary drug pricing agreement in January after the repayment rates surged to 26.5%.
ABPI has asked for the existing rates to be terminated at the end of 2023, while keeping it unchanged for now to buy time for negotiations.
The industry body said the government policies could further depress investments in UK's life science sector in the long term.
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(Reporting by Prerna Bedi in Bengaluru; Editing by Shinjini Ganguli and Shweta Agarwal)