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Published on 12 April 2010

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Drug giants threaten to quit UK

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Thousands of jobs in the medical sector could be at risk after Swiss drug giants Novartis and Roche threatened to move their British operations overseas amid concerns over low prices for their products due to the weak pound, the Guardian reports.

Too much red tape surrounding drug safety trials in the UK is also slowing the development of new products, the companies claimed in talks with the Government. Roche executives said trials in UK are “too expensive and bureaucratic”.

The Government has also recently renewed a deal with the pharmaceutical industry which sets the prices of drugs bought by the NHS which, in conjunction with a weaker pound, has led to a “price squeeze” on Roche products, John Melville, the head of Roche UK said.

Mr Melville said the falling margins in the UK are “a major issue” because UK drug prices act as reference prices for many developed countries including most of the EU.

Government ministers, including business secretary Lord Mandelson, have this year visited executives from the two companies at their headquarters in Japan, the US and Europe in what Whitehall called a “programme of ministerial visits”.

Subhanu Saxena, head of global marketing at Novartis, warned that it could move some of its drug safety trials out of Britain “because the slowness of the NHS system is making them uncompetitive”.

Copyright Press Association 2010
Roche



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