UK Medicine Sales Tax Hike Deemed 'Uninvestable', Warns Pharma
Drugmakers warn that the higher UK medicine sales tax is rendering the market 'uninvestable', leading to delays in new product launches and reduced NHS partnerships.
Published on March 29, 2025
Drugmakers have raised concerns that the recent increase in the UK's medicine sales tax, part of the VPAG scheme, is making the country less attractive for investments. The Association of the British Pharmaceutical Industry (ABPI) noted that the higher clawback tax has not only led to reduced headcount and NHS partnership abandonment but is also causing delays in launching new treatments. Reports from as early as January 2025 indicate that the unexpectedly high tax rate has alarmed companies, with some even cancelling major investments.
In response, the government is set to convene a summit with pharmaceutical leaders, as noted in articles from March 2025, to highlight the UK's scientific expertise and potential for clinical trials while addressing industry concerns. Despite these efforts, criticisms persist over the steep tax rate, with comparisons drawn to lower European rates and warnings that the current financial framework may block future investments in the life sciences sector.