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Leela Barham casts her economic eye over the All-Party Parliamentary Group (APPG) on Pharmacy report on medicines shortages

In July, the APPG on Pharmacy released its report on medicines shortages in England. A self-described “landmark report”, it sets out 12 “urgent” recommendations ranging from pharmacist substitution to manufacturing more at home and a UK-wide real-time communication system for shortages. 

The APPG on Pharmacy is an informal cross-party group. Steve Race, Labour MP for Exeter, is the current chair. It’s been around for years, having been formed in December 1999, and receives financial support from the main sector trade bodies, as well as Community Pharmacy England and the Royal Pharmaceutical Society. 

Work for the July 2025 report began in December 2024. The last major undertaking from the APPG came in January 2023, when it reported on the ‘Future of Pharmacy’. 

Wish list

The APPG has set out a long wish list – 12 ‘asks’ – which on the face of it seem reasonable (see box). 

Yet the APPG has fallen into the trap of not considering the added costs and benefits of each one. Even without doing the number crunching, it’s clear that not all 12 are affordable or will necessarily add a lot of value, at least any time soon.  

Costly recommendations

The review and reform of the CPCF recommendation comes just months after the deal was announced on 31 March. It’s easy to cost; the Frontier Economics analysis released at the same time as government announced the latest CPCF said the “estimated full economic cost [of community pharmacies in England] exceeded funding by £2,308 billion.” 

Meaning: if politicians want to keep the network in England as it stands, there’s a big price tag, one that was too high for HM Treasury and little suggests this has changed since negotiations concluded on the CPCF.

An independent review of the UK medicines supply would come at a cost, presumably nowhere near the costs of more formal public inquiries – which can run to millions – but there would be a cost, in large part, driven by the scope. There’s a lot to cover. 

Today’s manufacturing is the result of the global demand and supply drivers that are hard – likely expensive – to shift because the government would have to pay more, even if not directly subsidise. 

Cheap and cheerful 

Establishing a national patient advisory panel on medicines shortages could be relatively inexpensive, at least versus other recommendations. The question is what added value would this bring when the health secretary is more interested in reducing patient input, as signalled by cutting Healthwatches?

All the other recommendations are likely to sit somewhere between cheap and cheerful and costly. And each will offer lesser or greater value. So many are easy to say, but difficult to translate into action and costs can be both direct and indirect, given that recommendations like “strengthen procurement contracts” could mean the government having to pay more to secure supply for the UK. Add in dynamic effects as other countries seek to do the same, and there’s a potential for spiralling costs. 

Added value today?

Some might argue that it doesn’t matter if APPGs don’t anchor themselves in the financial realities of the policy areas they look at. Maybe it’s enough that they work to bring new or, as it feels like in community pharmacy– the same issues – to the fore of ministers’ minds? 

It’s unfortunate though that this report comes out just a month ahead of the DHSC’s ‘Managing a robust and resilient supply of medicines’ policy paper. Hard not to see the APPG report as being superseded already.

There is a lesson, though. Could the House of Lords Public Services Committee’s inquiry into the causes of medicines shortages, launched earlier this month put themselves in the shoes of those they seek to influence and recognise trade-offs and help others figure out what is the best value ask? A shorter list of higher-impact, low-cost recommendations could help focus policy efforts. 

The top pick that could be pushed is pharmacist substitution on the basis that it’s a change that is likely to be cost-effective, assuming it can be done wisely. 

There is merit in waiting to take a view after the DHSC consults on “pharmacist flexibilities” which it tabled in its policy paper. Could the Lords work fast and push DHSC to do this sooner rather than later?

APPG on Pharmacy 12 recommendations on medicines shortages in England

• Review and reform the Community Pharmacy Contractual Framework (CPCF) to deliver a sustainable funding and operating model that addresses financial pressures and reflects modern healthcare needs
• Publish and implement a UK-wide medicines shortages communication and patient support strategy
• Establish a national patient advisory panel on medicines shortages
• Develop patient-centred pathways for managing shortages in local systems
• NHS polices should be strengthened and updated to reduce unnecessary prescribing of medicines by brand, including branded generics
• Expand and further develop the Department of Health and Social Care (DHSC)/NHS Medicines Supply Tool across England
• Empower pharmacists to make dose and formulation substitutions during shortages
• Commission an independent review of the UK medicines supply chain
• Make the necessary investment to enhance data connectivity across manufacturers, wholesalers and healthcare provider.
• Foster domestic manufacturing capacity and local production of critical medicines and active pharmaceutical ingredients (APIs)
• Strengthen procurement contracts to reward continuity of supply and include clear quality and resilience measures
• Reform medicines pricing and reimbursement policies to better reflect market realities.