(2) which companies supplying products listed in Part IX of the Drug Tariff have provided information to his Department of a decline in manufacturing costs;
(3) which products were used to set the benchmark price in the proposed new pricing model for catheter, incontinence and stoma items; and when they were first listed on the Drug Tariff.
About £200 million a year is spent on appliances listed in part IXA (catheter-related), part IXB (continence-related) and part IXC (stoma-related) of the Drug Tariff.
Arrangements for reimbursement of these remained largely unchanged for 20 years and information obtained through the consultation process to date indicates that efficiencies have been achieved in the manufacturing process. If this is not the case, the current consultation gives all parties the opportunity to provide evidence to the contrary.
The proposed levels of reimbursement for catheter, continence and stoma-related appliances was set by using a pricing model that is set out in annex C of the consultation document entitled “Arrangements under Part IX of the Drug Tariff for the provision of stoma and incontinence appliances—and related services—to Primary Care. Revised proposals”.
Within each subcategory, the market share for products is measured as a percentage of total annual net ingredient cost spend. To determine the pricing model benchmark price, products with very low market share are excluded—as they may not represent a valid benchmark for pricing comparison. In relation to stoma and incontinence appliances, the Department proposed that products of less than 0.1 per cent. of market share should be excluded for benchmarking purposes.
This model was applied to the 5,000 plus items that are listed in parts IXA, B and C. As proposed, these items have been classified into 228 categories. To identify the date that the items that were at the benchmark price were first listed in the Drug Tariff could be done only at disproportionate cost to the Department. Information provided during meetings and in correspondence and has been offered commercial in confidence.