Drugs: Concessions
The question
To ask the Secretary of State for Health and Social Care, what assessment he has made of the potential impact of VAT on the provision of free of charge compassionate drugs.
Answered by Preet Kaur Gill
The Government recognises the important role that expanded access programmes can play in enabling patients, particularly those with serious or rare conditions, to access innovative medicines outside routine commissioning arrangements.
As with other goods, the VAT treatment of medicines in the United Kingdom is governed by long-standing principles. This means that even where medicines are supplied free of charge in certain circumstances, a taxable supply may arise. There is no specific VAT exemption for medicines provided through expanded access programmes.
The Government is committed to finding a solution to the issue of companies paying VAT on medicines donated free of charge. This will be delivered either through a VAT change, or through a reimbursement scheme. This decision is subject to further policy work, and officials are working with stakeholders to explore options.
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