A National Audit Office (NAO) report into last year’s “unexpected increase” in generics prices – published last month (June 8) – referred to government evidence of “unexpected increases in wholesalers’ margins, which it could not fully explain”.
The following week, the UK’s largest wholesalers denied any knowledge of the “unexplained” margin growth.
C+D used the Freedom of Information Act to request the names of the wholesalers the Department of Health and Social Care (DH) had identified as having experienced a growth in their margins, but was told it would “not be in the public interest” to disclose this information.
While the DH “recognises a public interest in generally understanding the mechanisms used to set reimbursement prices”, it told C+D that “the actual data used to set concessionary prices is obtained from suppliers, and as such is commercially sensitive”.
“The department considers that disclosure would be likely to prejudice the commercial interests of suppliers,” it added.
Wholesalers currently submit information on generics prices to the DH “under voluntary arrangements negotiated between the DH and industry representative bodies”, it explained.
“If organisations decide not to give this information again due to [the] risk of the department disclosing the information and prejudicing their commercial interests, it would damage the department’s ability to set reimbursement prices which reflect market prices, thus possibly increasing the cost to the taxpayer.”
Earlier this month, a DH representative told the Public Accounts Committee – the parliamentary office responsible for scrutinising government spending – that there is “no concrete evidence” to explain why some wholesalers’ profits grew in parallel with last year’s generics price increases.