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Pharmaceutical Services Negotiating Committee

Drug Tariff Reimbursement

What is the Drug Tariff?

The Drug Tariff is produced monthly by the Pharmaceutical Directorate of the NHS Business Services Authority, NHS Prescription Services for the Secretary of State and is supplied primarily to pharmacists, doctors surgeries and (twice yearly) to Nurse Prescribers. The Drug Tariff provides information on what will be paid to contractors for NHS Services including both reimbursement (eg. the cost of drugs and appliances supplied against an NHS Prescription form) and remuneration (eg. professional fees/allowances which are paid as part of the NHS pharmacy contract).

For a detailed description of the Drug Tariff please visit the PSNC Drug Tariff Resource Centre.

The Drug Tariff is available to view online each month on the NHS Prescription Services website.


What is Category M?

Category M was introduced into the Drug Tariff in April 2005 when the new community pharmacy contract was launched. Key points about the system:

  • Category M is used to adjust the reimbursement prices of over 500 medicines.
  • It is the principal price adjustment mechanism to ensure delivery of the purchase profit income guaranteed as part of the pharmacy contract.
  • It uses information gathered from manufacturers on volumes and prices of products sold plus information from the NHSBSA Prescription Services on dispensing volumes to calculate margins in the supply chain.
  • It is normally adjusted on a quarterly cycle in light of this information and negotiations with PSNC.
  • As prices have to be set in advance each quarter, estimated volumes are used which may differ from actual volumes. However, the built in correction mechanism ensures that the quarterly adjustments account for any over or under recovery in practice.
  • It is closely monitored by PSNC to ensure that the scheme operates correctly and to identify anomalies. Regular feedback meetings are held with the DH.

PSNC puts considerable resources into monitoring all elements of funding, including Category M.

One problem that can arise is products not being available to purchase at the Category M reimbursement price. The Department of Health sets Category M prices at levels substantially above the prices notified by manufacturers. But when the Category M reimbursement price for a particular product falls, it may take time, and sustained pressure from pharmacies, for wholesale prices to respond. During this period, it is essential that contractors exert maximum pressure on wholesalers. There have been a number of examples where manufacturers prices were below the Drug Tariff price but a product could not be obtained at the Drug Tariff price from a number of wholesalers.

In some parts of the country, another problem is branded prescribing. As Category M prices are set to include an element of purchase profit, a fundamental part of the new contract funding arrangements, reimbursement prices may be higher than manufacturer’s list prices. To save money, some PCTs are encouraging branded prescribing. When products are prescribed generically, pharmacies seek to obtain the best available generics prices, driving down the prices being charged by wholesalers and manufacturers and in turn the Drug Tariff reimbursement prices and costs for the NHS. Prescribing branded generics or off-patent branded medicines profoundly affects the competition that drives down prices in the generics market and acts to drive up costs to the NHS. It can also lead to unequal geographical distribution of the funding under the New Contract. PSNC is completely against this practice. The government is currently giving consideration to the problem following the OFT Review of the Pharmaceutical Price Regulation Scheme.

PSNC meets regularly with the Department of Health to discuss progress with the system and problems that arise.

For Category M frequently asked questions please visit our funding FAQs section.


Scheme M & W

On 29th June 2005, details were announced of two voluntary schemes for wholesalers and generics manufacturers (M and W) backed by Section 33 of the Health Act 1999, that are designed to assist the Department of Health in gathering information to support the quarterly revision of Category M prices. Click on the links below for more information on the voluntary schemes for Manufacturers and Wholesalers.

Scheme M: Generic Manufacturers

Scheme W: Wholesalers


Category M: Products and Prices

Latest List

Category M: 2013/14 Quarter 1 Price List (Apr-Jun 13) (PDF)

Category M: 2013/14 Quarter 1 Price List (Apr-Jun 13) (MS Excel)

Category M: 2013/14 January and April prices combined (MS Excel)

Archive List

Category M: 2012/13 Quarter 4 Price List(Jan-Mar 13) (PDF)

Category M: 2012/13 Quarter 4 Price List (Jan-Mar 13) (MS Excel)

Category M 2012/13 Oct and Jan prices combined (MS Excel)

Category M: 2012/13 Quarter 3 Price list (Oct-Dec 12) (PDF)

Category M: 2012/13 Quarter 3 Price list (Oct-Dec 12) (MS Excel)

Category M: 2012/13 July and Oct prices combined (MS Excel)

Category M: 2012/13 Quarter 2 Price list (July 12 - Sep 12) (PDF)

Category M: 2012/13 Quarter 2 Price list (July 12 - Sep 12) (MS Excel)

Category M: 2012/13 April and July prices combined (MS Excel)

Category M: 2012/13 Quarter 1 Price List (Apr 12 - Jun 12) (PDF)

Category M: 2012/13 Quarter 1 Price List (Apr 12 - Jun 12) (MS Excel)

Category M: 2012/13 January & April changes combined (MS Excel)

Category M: 2011/12 Quarter 4 Price List (Jan 12 - Mar 12) (PDF)

Category M: 2011/12 Quarter 4 Price List (Jan 12 - Mar 12) (MS Excel)

Category M: 2011/12 October & January changes combined (MS Excel)

Category M: 2011/12 Quarter 3 Price List (Oct 11 - Dec 11) (PDF)

Category M: 2011/12 Quarter 3 Price List (Oct 11 - Dec 11) (MS Excel)

Category M: 2011/12 July & October changes combined (MS Excel)

Category M: 2011/12 Quarter 2 Price List (Jul 11 - Sep 11) (PDF)

Category M: 2011/12 Quarter 2 Price List (Jul 11 - Sep 11) (MS Excel)

Category M: 2011/12 April & July changes combined (MS Excel)

Category M: 2011/12 Quarter 1 Price List (Apr 11 - Jun 11) (PDF)

Category M: 2011/12 Quarter 1 Price List (Apr 11 - Jun 11) (MS Excel)

Category M: 2011/12 January & April changes combined (MS Excel)

Category M: 2010/11 Quarter 4 Price List (Jan 11 - Mar 11) (PDF)

Category M: 2010/11 Quarter 4 Price List (Jan 11 - Mar 11) (MS Excel)

Category M: 2010/11 October & January changes combined (MS Excel)

Category M: 2010/11 Quarter 3 Price List (Oct 10 - Dec 10) (PDF)

Category M: 2010/11 Quarter 3 Price List (Oct 10 - Dec 10) (MS Excel)

Category M: 2010/11 July & October changes combined (MS Excel)

Category M: 2010/11 Quarter 2 Price List (Jul 10 - Sep 10) (PDF)

Category M: 2010/11 Quarter 2 Price List (Jul 10 - Sep 10) (MS Excel)

Category M: 2010/11 April & July changes combined (MS Excel)

Category M: 2010/11 Quarter 1 Price List (Apr 10 - Jun 10) (PDF)

Category M: 2010/11 Quarter 1 Price List (Apr 10 - Jun 10) (MS Excel)

Category M: 2010/11 January & April changes combined (MS Excel)

Category M: 2009/10 Quarter 4 Price List (Jan 10 - Mar 10) (PDF)

Category M: 2009/10 Quarter 4 Price List (Jan 10 - Mar 10) (MS Excel)

Category M: 2009/10 October & January changes combined (MS Excel)

Category M: 2009/10 Quarter 3 Price List (Oct 09 - Dec 09) (PDF)

Category M: 2009/10 Quarter 3 Price List (Oct 09 - Dec 09) (MS Excel)

Category M: 2009/10 July & October Changes Combined (MS Excel)

Category M: 2009/10 Quarter 2 Price List (July 09 - Sep 09) (PDF)

Category M: 2009/10 Quarter 2 Price List (July 09 - Sep 09) (MS Excel)

Category M: 2009/10 April & July Changes Combined (MS Excel)

Category M: 2009/10 Quarter 1 Price List (Apr 09 - Jun 09) (PDF)

Category M: 2009/10 Quarter 1 Price List (Apr 09 - Jun 09) (MS Excel)

Category M: 2009/10 January & April Changes Combined (MS Excel)

Category M: 2008/09 Quarter 4 Price List (Jan 09 - Mar 09) (PDF)

Category M: 2008/09 Quarter 4 Price List (Jan 09 - Mar 09) (MS Excel)

Category M: 2008/09 October & January Changes Combined (MS Excel)

Category M: 2008/09 Quarter 3 Price List (Oct 08 - Dec 08) (PDF)

Category M: 2008/09 Quarter 3 Price List (Oct 08 - Dec 08) (MS Excel)

Category M: 2008/09 July & October Changes Combined (MS Excel)

Category M: 2008/9 Quarter 2 Price List (Jul 08 - Sep 08) (PDF)

Category M: 2008/9 Quarter 2 Price List (Jul 08 - Sep 08) (MS Excel)

Category M: 2008/9 April & July Changes Combined (MS Excel)

Category M: 2008/9 Quarter 1 Price List (Apr - Jun 08) (PDF)

Category M: 2008/9 Quarter 1 Price List (Apr - Jun 08) (MS Excel)

Category M: January & April 2008 Changes Combined (MS Excel)

Category M: 2007/8 Quarter 4 Price List (Jan - Mar 08) (PDF)

Category M: 2007/8 Quarter 3 Price List (Oct - Dec 07) (PDF)

Category M: 2007/8 Quarter 2 Price List (Jul - Sep 07) (PDF)

Category M: 2007/8 Quarter 1 Price List (Apr - Jun 07) (PDF)

Category M: 2006/7 Quarter 4 Price List (Jan - Mar 07) (PDF)

Category M November 2006 Price Changes (PDF)

Category M: 2006/7 Quarter 3 Price List (Oct - Dec 06) (PDF)

Category M: 2006/7 Quarter 2 Price List (July - Sep 06) (PDF)

Category M: 2006/7 Quarter 1 Price List (Apr - Jun 06) (PDF)

Category M: 2005/6 Quarter 4 Price List (Jan - Mar 06) (PDF)

Category M: 2005/6 Quarter 3 Price List (Oct - Dec 05) (PDF)

Please note the archive lists do not include all additions, deletions or changes made mid-quarter.


Useful Links

Principles for funding agreement

Current funding setlement details

Margins Survey

Chronological summary of key funding changes

 

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