I find this extremely amusing I do. No, not the idea that there are millions of women now screaming at their partners as a result of the change of life – not that sort of amusement. Rather, that there’s a cock up here and near no one will take the correct message from it, learn the right lesson.
Don’t screw with markets.
But that’s just what has been done. HRT is now difficult to find – the actual drugs themselves that is – because the National Health Service decided to fix the price.
Hundreds of thousands of women in the UK have been affected by the ongoing shortage of many HRT products. The products aren’t made in the UK but the shortage is very much a UK thing. Emma Hartley discovers why.
The short version: the UK government messed up.
The slightly longer version: supply problems have been massively magnified by a change to the way the UK prices HRT medication, changes which have also been affected by the Brexit-related fall in the value of the pound.
We can and should go further. If you fix the price of something below that at which people are willing to sell it then that something stops being for sale. That’s it. There is no mystery here. Supply and demand works, this is reality.
When the Department of Health and Social Care (DHSC), in consultation with the Pharmaceutical Services Negotiating Committee (PSNC), an arms-length agency operating from Hosier Lane in the City of London and led by Simon Dukes, changed the tariff for these HRT products it did so, the DHSC press office has since told me, because there were pricing fluctuations on the world market.
By pegging the UK price at a certain level it was hoped that the NHS would be able to minimise its bill for these medicines in the face of market uncertainty.
However, what appears to have happened is that the price was pegged at a level where it was simply unattractive for the pharmaceutical companies involved to sell to the UK – and the invisible hand of the market has done the rest.
That’s it and that’s all.
An interesting lesson for the US medical industry perhaps, where Bernie and Lizzie keep telling everyone that they’d save lots of money by the gubmint being able to negotiate (Ha!) drug prices with suppliers.
Also an interesting lesson for all of us of course. The idea that the government knows the correct price of something seems to fail under real world testing….