Eli Lilly and Co. (NYSE:LLY) CEO Dave Ricks strongly criticized the United Kingdom's approach to drug pricing, describing it as "probably the worst country in Europe" for pharmaceutical prices.
He warned that patients may miss out on new medicines if conditions do not improve.
Ricks' comments, made in an interview with the Financial Times, intensify the growing backlash from global drugmakers who argue that Britain's pricing policies and rebate rules undermine innovation and investment in the country.
Reuters reported that at the center of the dispute is the VPAG rebate scheme, a government agreement with the pharmaceutical industry and the National Health Service (NHS).
Also Read: Pharmaceutical Firms Say UK Investment Is ‘Unlikely' Unless Payment Levy Is Addressed
The program is designed to control the NHS drug budget while supporting patient access and the broader life sciences sector. However, executives like Ricks argue that the scheme penalizes companies for their success by clawing back a portion of their revenues.
Ricks said Britain's low drug prices compared to other developed nations could deter pharmaceutical firms from introducing new therapies.
He added that Lilly wants to see the rebate scheme scrapped, describing it as an unnecessary barrier to innovation. "That's the UK's choice, but we react to those choices," Ricks said.
In August, drug pricing talks between the U.K. government and pharmaceutical companies collapsed, with industry leaders warning that the standoff could deter investment.
Health Secretary Wes Streeting described the government's offer as "unprecedented," but drugmakers argued that it still imposed excessive costs and requested to negotiate directly with Prime Minister Keir Starmer.
U.K. Investment Halt
Last week, Merck & Co. Inc. (NYSE:MRK) announced it would cancel its planned $1.36 billion (1 billion Sterling pounds) London research center.
The company cited Britain's slow progress on life sciences investment and successive governments' undervaluation of innovative medicines.
AstraZeneca Plc (NASDAQ:AZN) also paused a planned investment of 200 million pounds ($271.26 million) in its Cambridge research site.
Earlier this year, AstraZeneca abandoned plans for a vaccine manufacturing facility in the U.K. for $554.32 million (450 million pounds) following disagreements with government officials over state support.
On Tuesday, Eli Lilly plans to build a new $6.5 billion manufacturing facility at Generation Park in Houston, Texas, as a synthetic medicine active pharmaceutical product (API) facility.
The facility will focus on manufacturing the company's pipeline of small-molecule medicines in therapeutic areas including cardiometabolic health, oncology, immunology and neuroscience.
It is expected to be operational within five years. The site will be among those that will manufacture orforglipron, Lilly's first oral weight loss drug, which the company expects to submit to global regulatory agencies for obesity by the end of this year.
LLY Price Action: Eli Lilly shares were down 1.11% at $738.70 at the time of publication on Wednesday. The stock is trading within its 52-week range of $623.78 to $939.30, according to Benzinga Pro data.
Read Next:
Photo via Shutterstock
