The Branded Health Service Medicines (Costs) Regulations 2018

• (b) in respect of that financial year provide the audited sales report and presentation report for the period from the date on which the requirement to make a payment in regulation 3(1) or (1AA) or a direction given under regulation 4(2)(b) begins to apply until the end of the financial year.

5

Where the requirement to make a payment set out in regulation 3(1) or (1AA) or under a direction given under regulation 4(2)(b) stops applying to a manufacturer or supplier part way through any of their quarters, remaining period or financial year, the manufacturer or supplier must—

• (a) in respect of that quarter or remaining period, calculate the payment and provide the sales report, for the period from the beginning of the quarter or remaining period to the date the requirement to make a payment in regulation 3(1) or (1AA) or under a direction given under regulation 4(2)(b) stops applying; and

• (b) in respect of that financial year provide the audited sales report and presentation report for the period from the beginning of the financial year to the date that the requirement to make a payment in regulation 3(1) or (1AA) or under a direction given under regulation 4(2)(b) stops applying.

6

Where a manufacturer or supplier changes the length of their current or previous accounting reference date under section 392 of the Companies Act 2006 so as to extend or shorten its current or previous accounting reference period, the manufacturer or supplier must in writing notify the Secretary of State of the new date of its accounting reference period and provide the Secretary of State with the relevant documents which show that the accounting reference period has changed within 30 days of the change.

7

A manufacturer's or supplier's “previous accounting reference period” means the one immediately preceding its current accounting reference period.

SCHEDULE 2 — Small manufacturer or supplier

Determination of small manufacturer or supplier

1

A small manufacturer or supplier means—

• (a) with respect to a manufacturer or supplier referred to in paragraph 2, a manufacturer or supplier that, as determined by the Secretary of State, is likely to receive in respect of the total supply of all presentations, a total net sales income below the thresholds set out in column (2) of table 1 where it satisfies the corresponding description of the manufacturer's or supplier's current accounting reference period specified in column (1) of the table; or

• (b) with respect to a manufacturer or supplier referred to in paragraph 3, a manufacturer or supplier that has received in respect of the total supply of all presentations, a total of net sales income below the thresholds set out in column (2) of table 2 where it satisfies the corresponding description of the manufacturer's or supplier's previous accounting reference period specified in column (1) of the table.

2

The manufacturer or supplier referred to in paragraph 1(a) is a manufacturer or supplier that would be required to make payments under regulation 3 or under a direction given under regulation 4 for a period of less than one of their complete accounting reference periods were it not for the fact that regulation 3(6) or 4(5) applied.

3

The manufacturer or supplier referred to in paragraph 1(b) is a manufacturer or supplier that would be required to make payments under regulation 3 or under a direction given under regulation 4 for a period of one or more of their complete accounting reference periods were it not for the fact that regulation 3(6) or 4(5) applied.

Information requirements

4

A manufacturer or supplier referred to in paragraph 2 that considers that it is likely to receive in respect of the total supply of all presentations, a total net sales income below the thresholds set out in column (2) of table 1 where it satisfies the corresponding description of the manufacturer's or supplier's current accounting reference period specified in column (1) of table 1, must provide in writing to the Secretary of State information setting out—

• (a) an estimate of the total net sales income it is likely to receive in respect of the total supply of all presentations for its current financial year within 30 days of the date on which the requirement to make payments under regulation 3 or under a direction given under regulation 4(2)(b) would begin to apply were it not for the fact that regulation 3(6) or 4(5) applied;

• (b) the total net sales income in respect of the total supply of all presentations for its previous financial year within 30 days of the completion of the first financial year during which the requirement to make payments under regulation 3 or under a direction given under regulation 4(2)(b) would have first applied were it not for the fact that regulation 3(6) or 4(5) applied.

5

A manufacturer or supplier referred to in paragraph 3 must provide, in writing, information setting out its total net sales income in respect of the total supply of all presentations for each complete financial year within 30 days of each financial year that the manufacturer or supplier remains a small manufacturer or supplier.

Rules

6

This Schedule must be construed in accordance with the following rules.

7

The end date of the final period in the manufacturer's or supplier's financial year, be that the final quarter or remaining period, must be treated as extended or reduced by not more than seven days before or after that period, if the end date of the supplier's or manufacturer's financial year has, in accordance with section 390(2)(b) of the Companies Act 2006, also been reduced or extended by the same period.

8

Where a manufacturer or supplier changes the length of their current or previous accounting reference date under section 392 of the Companies Act 2006 so as to extend or shorten its current or previous accounting reference period, the new manufacturer or supplier must in writing notify the Secretary of State of the new date of its accounting reference period and provide the Secretary of State with the relevant documents which show that the accounting reference period has changed within 30 days of the change.

9

A manufacturer's or supplier's “previous accounting reference period” means the one immediately preceding its current accounting reference period.

SCHEDULE 3 — New manufacturer or supplier

Information requirements

1

A new manufacturer or supplier required to make payments under regulation 3 or a direction given under regulation 4(2) must provide in writing to the Secretary of State an estimate of the total of net sales income it is likely to receive in respect of the total supply of its presentations for its first financial year within 30 days of the date on which the requirement to make a payment under regulation 3 or a direction under regulation 4(2) begins to apply to the new manufacturer or supplier.

2

Where the new manufacturer or supplier is not a small manufacturer or supplier, the new manufacturer or supplier must provide to the Secretary of State information in column (2) of the table in respect of each corresponding quarter, remaining period or financial year specified in column (1) of that table no later than within the corresponding time in column (3) of that table.

Rules

3

This Schedule must be construed in accordance with the following rules.

4

The end date of the final period in a manufacturer's or supplier's financial year, be that the final quarter or remaining period, must be treated as extended or reduced by not more than seven days before or after that period, if the end date of the supplier's or manufacturer's financial year has, in accordance with section 390(2)(b) of the Companies Act 2006, also been reduced or extended by the same period.

5

Where the requirement to make a payment set out in regulation 3(1) or under a direction given under regulation 4(2)(b) begins to apply to a manufacturer or supplier part way through any of their quarters, remaining period or financial year the manufacturer or supplier must—

• (a) in respect of that quarter or remaining period, calculate the payment and provide the sales report for the period from the date on which the requirement to make a payment in regulation 3(1) or a direction given under regulation 4(2)(b) begins to apply until the end of the relevant quarter or remaining period; and

• (b) in respect of that financial year provide the audited sales report and presentation report for the period from the date on which the requirement to make a payment in regulation 3(1) or a direction given under regulation 4(2)(b) begins to apply until the end of the financial year.

6

Where the requirement to make a payment set out in regulation 3(1) or under a direction given under regulation 4(2)(b) stops applying to a manufacturer or supplier part way through any of their quarters, remaining period or financial year the manufacturer or supplier must—

• (a) in respect of that quarter or remaining period, calculate the payment and provide the sales report, for the period from the beginning of the quarter or remaining period to the date the requirement to make a payment in regulation 3(1) or under a direction given under regulation 4(2)(b) stops applying; and

• (b) in respect of that financial year provide the audited sales report and presentation report for the period from the beginning of the financial year to the date that the requirement to make a payment in regulation 3(1) or under a direction given under regulation 4(2)(b) stops applying.

7

Where a manufacturer or supplier changes the length of their current or previous accounting reference date under section 392 of the Companies Act 2006 so as to extend or shorten its current or previous accounting reference period, the new manufacturer or supplier must in writing notify the Secretary of State of the new date of its accounting reference period and provide the Secretary of State with the relevant documents which show that the accounting reference period has changed within 30 days of the change.

8

A manufacturer's or supplier's “previous accounting reference period” means the one immediately preceding its current accounting reference period.

SCHEDULE 4 — Recoverable Sums

1

For the purposes of regulation 14, the recoverable sum will be the sum of—

• (a) the difference between the amount which the manufacturer or supplier would have received in any month where there is a contravention (that month starting on the date of the first contravention that relates to the presentation) had the product been supplied at the maximum price and the amount that the manufacturer or supplier actually received; and

• (b) the amount calculated by multiplying that difference by the appropriate additional percentage specified in the table.

2

In respect of a contravention described in column (1) of the following table, the appropriate additional percentage is specified opposite in column (2).

3

For the purposes of this Schedule—

• (a) “second contravention” occurs where a presentation continues to be supplied in contravention of these Regulations for a period of two months after the first contravention which relates to that presentation;

• (b) each subsequent contravention occurs where the same presentation continues to be supplied for a further period of one month from the date of a previous contravention which relates to that presentation;

• (c) if the period between contraventions means that the amount calculated under paragraph 1(a) is zero, the next month for which there is an amount calculated under paragraph 1(a) that is greater than zero in respect of that presentation is treated as a new first contravention for the purposes of paragraph 2.

SCHEDULE 5 — Penalties

1

Subject to paragraph 2, the daily penalty payable by a manufacturer or supplier must be calculated by reference to—

• (a) the entry in column (1) of table 1 within which the total value of its net sales income for total supply of all presentations falls;

• (b) the amount specified in column (2) opposite that entry in respect of each day of the contravention; and

• (c) the amount specified in column (3) opposite that entry in respect of each subsequent day of that contravention.

Column (1) Total values of its net sales income for the total supply of all presentations in most recent complete financial year or if not available, total estimate value of its net sales income for its current financial year	Column (2) Daily penalty for first 14 days	Column (3) Daily penalty for subsequent days
Less than £100 million	£2,500	£5,000
£100 million or more	£5,000	£10,000

2

Where the Secretary of State is unable to reasonably determine the net sales income specified in the first column of table 1, the daily penalty payable by a manufacturer or supplier must be calculated by reference to—

• (a) the manufacturer or supplier's Total United Kingdom sales in column (1) of table 2;

• (b) the amount specified in column (2) opposite that entry in respect of each day of the contravention; and

• (c) the amount specified in column (3) opposite that entry in respect of each subsequent day of that contravention.

Column (1) Total United Kingdom sales	Column (2) Daily penalty for first 14 days	Column (3) Daily penalty for subsequent days
Less than £100 million	£2,500	£5,000
£100 million or more	£5,000	£10,000

3

Subject to paragraph 4, for the purposes of table 2, the Total United Kingdom sales will be calculated at the time the penalty becomes payable by reference to the manufacturer's or supplier's total sales in the United Kingdom as shown in its statutory audited accounts or where the manufacturer or supplier does not have statutory audited accounts, its individual accounts, for its most recent complete financial year.

4

For the purposes of table 2, the Total United Kingdom sales of a new manufacturer or supplier will be assumed to be less than £100 million.

Signed

Signed by the authority of the Secretary of State for Health and Social Care.

O'Shaughnessy — Parliamentary Under-Secretary of State, — 2018-03-08

Explanatory note

(This note is not part of the Regulations)

Footnotes

[^f00001]: 2006 c. 41; section 263 was amended by the Health Service Medical Supplies (Costs) Act 2017 (c.23) (“the 2017 Act”), section 5 and 10(5). Section 264A was inserted by the 2017 Act, section 8. Section 265 was amended by the 2017 Act, section 6, 7 and 10. Section 266 was amended by the 2017 Act, section 6 and 7(6). See section 275(1) of the National Health Service Act 2006 (“the 2006 Act”) for the definition of “prescribed” and “regulations” that are relevant to the powers being exercised.

[^f00002]: 1978 c. 29.

[^f00003]: 2006 c. 42.

[^f00004]: S.I. 2008/3258 amended by S.I. 2012/1916, 2013/2881 and 2015/233, revoked with a saving provision by the coming into force of regulation 28 of these Regulations.

[^f00005]: S.I. 2012/1916 to which there are amendments not relevant to these Regulations.

[^f00006]: 2006 c. 46.

[^f00007]: S.I. 2006/5 revoked by regulation 116 of the Public Contracts Regulations 2015 (S.I. 2015/102).

[^f00008]: S.S.I. 2012/88 revoked by regulation 97 of the Public Contracts (Scotland) Regulations 2015 (S.S.I. 2015/446).

[^f00009]: S.I. 2015/102 to which there are amendments not relevant to this definition.

[^f00010]: S.S.I. 2015/446 to which there are amendments not relevant to these Regulations.

[^f00011]: OJ No L 152, 16.06.2009, p1 amended by the Treaty of Accession of Croatia (OJ No L 112, 24.4.2012, p10).

[^f00012]: 2009 c. 1 (N.I.).

[^f00013]: S.I. 2005/2414.

[^f00014]: See also section 264A(16), which contains a transitional provision which applies until the coming into force of the repeal of section 27 of the National Health Service (Scotland) Act 1978 by Schedule 3 of the Smoking, Health and Social Care (Scotland) Act 2005 and which relates to the provision of pharmaceutical services in Scotland.

[^f00015]: Copies can be obtained from https://www.pharmacopoeia.com/what-is-the-ban-book or the Stationery Office, PO Box 29, Norwich, NR3 1GN.

[^f00016]: See Article 57(1)(o) of Regulation (EC) 726/2004 of the European Parliament and of the Council of 31 March 2004 laying down Community procedures for the authorisation and supervision of medicinal products for human and veterinary use and establishing a European Medicines Agency (OJ No L 136, 30.04.2004, p1) as last amended by Regulation No 1072/2012 of the European Parliament and of the Council of 25 October 2012 (OJ No L316 14.11.2012, p38).

[^f00017]: Section 2C was inserted by the Primary Medical Services (Scotland) Act 2004 (asp 1) section 1(2), and has been amended by: the National Health Service Reform (Scotland) Act 2004 (asp 7), Schedule 1, paragraph 1(3); the Tobacco and Primary Medical Services (Scotland) Act 2010 (asp 3), section 37; and SSI 2010/283.

[^f00018]: Section 17J was inserted by the Primary Medical Services (Scotland) Act 2004 (asp 1), section 4.

[^f00019]: Section 17C was inserted by the National Health Service (Primary Care) Act 1997 (c. 46), section 21(2), and has been amended by: the Primary Medical Services (Scotland) Act 2004 (asp 1), section 2(2); and the Health and Social Care Act 2012 (c. 7), Schedule 21, paragraph 3(2)(a).

[^f00020]: S.I. 1972/1265 (N.I. 14).

[^f00021]: S.I. 2015/102, amended by S.I.2016/275; there are other amending instruments but none is relevant.

[^f00022]: S.I. 2004/629.

[^f00023]: 1978 c. 29; section 17N was inserted by section 4 of the Primary Medical Services (Scotland) Act 2004 (asp 1).

[^f00024]: 1978 c. 29; section 17J was inserted by section 4 of the Primary Medical Services (Scotland) Act 2004 (asp 1).

[^f00025]: S.R. (NI) 2004 No. 142.

[^f00026]: S.I. 2004/1022.

[^f00027]: The website address is https://apps.nhsbsa.nhs.uk/infosystems/welcome.

[^f00028]: Sections 390, 391 and 392 of the Companies Act 2006 (c. 46) provide that a company can have a financial year of any period between 1 day up to a maximum of 18 months, plus or minus seven days.

[^f00029]: 1977 c. 37; section 25(3) was amended subject to transitional provisions specified in article 3 of S.I. 2005/2471 of the Patents Act 2004 (c.16), section 8(1). Section 25(4) was amended by the Patents Act 2004 (c.16), section 8(2).

[^f00030]: 2000 c. 36.

[^f00031]: 2002 asp 13.

[^f00032]: 2006 c. 41; section 261(1) was amended by the Health Service Medical Supplies (Costs) Act 2017 (c.23), section 3(2)(a).

[^f00033]: 1998 c. 11.

[^f00034]: S.I. 2000/124 as amended by S.I. 2000/870 and 2007/1898.

[^f00035]: As established under Regulation (EC) 726/2004 of the European Parliament and of the Council of 31 March 2004 laying down Community procedures for the authorisation and supervision of medicinal products for human and veterinary use and establishing a European Medicines Agency (OJ No L 136, 30.04.2004, p 1).

[^f00036]: OJ No L 311, 28.11.2001, p.67; article 21 was amended by Directive 2011/62/EU of the European Parliament and of the Council of 15 December 2010 (OJ No. L 348 31.12.2010, p 74).

[^f00037]: Registered Number 02486368. Copies of the relevant statements and standards can be obtained from the Financial Reporting Council Limited, 8th Floor, 125 London Wall, London, EC2Y 5AS or at https://www.frc.org.uk/auditors/audit-assurance/standards-and-guidance.

[^f00038]: S.I. 2000/124 amended by S.I. 2000/870 and 2007/1898.

[^f00039]: See section 265(7) of the 2006 Act for the definition of enforcement decision, which includes any decision relating to information that is required by virtue of an information notice under section 264A(5) of the 2006 Act.

[^f00040]: S.I. 2007/1320 amended by S.I. 2008/1938 and 3258, 2013/325 and 2881 and 2015/233.

[^f00041]: A record of the decisions of maximum prices which may be charged for the supply of presentations is available on a list published by the Department of Health and Social Care at https://dhexchange.kahootz.com/connect.ti/PPRS/groupHome. Copies of the list can be obtained from the Department of Health and Social Care at 39 Victoria Street, London, SW1H 0EU.

Editorial notes

[^c22928981]: 2006 c. 41; section 263 was amended by the Health Service Medical Supplies (Costs) Act 2017 (c.23) (“the 2017 Act”), section 5 and 10(5). Section 264A was inserted by the 2017 Act, section 8. Section 265 was amended by the 2017 Act, section 6, 7 and 10. Section 266 was amended by the 2017 Act, section 6 and 7(6). See section 275(1) of the National Health Service Act 2006 (“the 2006 Act”) for the definition of “prescribed” and “regulations” that are relevant to the powers being exercised.

[^c22928991]: 1978 c. 29.

[^c22929001]: 2006 c. 42.

[^c22929011]: S.I. 2008/3258 amended by S.I. 2012/1916, 2013/2881 and 2015/233, revoked with a saving provision by the coming into force of regulation 28 of these Regulations.

[^c22929021]: S.I. 2012/1916 to which there are amendments not relevant to these Regulations.

[^c22929031]: 2006 c. 46.

[^c22929041]: S.I. 2006/5 revoked by regulation 116 of the Public Contracts Regulations 2015 (S.I. 2015/102).

[^c22929051]: S.S.I. 2012/88 revoked by regulation 97 of the Public Contracts (Scotland) Regulations 2015 (S.S.I. 2015/446).

[^c22929061]: S.I. 2015/102 to which there are amendments not relevant to this definition.

[^c22929071]: S.S.I. 2015/446 to which there are amendments not relevant to these Regulations.

[^c22929081]: OJ No L 152, 16.06.2009, p1 amended by the Treaty of Accession of Croatia (OJ No L 112, 24.4.2012, p10).

[^c22929091]: 2009 c. 1 (N.I.).

[^c22929101]: S.I. 2005/2414.

[^c22929111]: See also section 264A(16), which contains a transitional provision which applies until the coming into force of the repeal of section 27 of the National Health Service (Scotland) Act 1978 by Schedule 3 of the Smoking, Health and Social Care (Scotland) Act 2005 and which relates to the provision of pharmaceutical services in Scotland.

[^c22929121]: Copies can be obtained from https://www.pharmacopoeia.com/what-is-the-ban-book or the Stationery Office, PO Box 29, Norwich, NR3 1GN.

[^c22929131]: See Article 57(1)(o) of Regulation (EC) 726/2004 of the European Parliament and of the Council of 31 March 2004 laying down Community procedures for the authorisation and supervision of medicinal products for human and veterinary use and establishing a European Medicines Agency (OJ No L 136, 30.04.2004, p1) as last amended by Regulation No 1072/2012 of the European Parliament and of the Council of 25 October 2012 (OJ No L316 14.11.2012, p38).

[^c22929141]: Section 2C was inserted by the Primary Medical Services (Scotland) Act 2004 (asp 1) section 1(2), and has been amended by: the National Health Service Reform (Scotland) Act 2004 (asp 7), Schedule 1, paragraph 1(3); the Tobacco and Primary Medical Services (Scotland) Act 2010 (asp 3), section 37; and SSI 2010/283.

[^c22929151]: Section 17J was inserted by the Primary Medical Services (Scotland) Act 2004 (asp 1), section 4.

[^c22929161]: Section 17C was inserted by the National Health Service (Primary Care) Act 1997 (c. 46), section 21(2), and has been amended by: the Primary Medical Services (Scotland) Act 2004 (asp 1), section 2(2); and the Health and Social Care Act 2012 (c. 7), Schedule 21, paragraph 3(2)(a).

[^c22929171]: S.I. 1972/1265 (N.I. 14).

[^c22929191]: S.I. 2004/629.

[^c22929201]: 1978 c. 29; section 17N was inserted by section 4 of the Primary Medical Services (Scotland) Act 2004 (asp 1).

[^c22929211]: 1978 c. 29; section 17J was inserted by section 4 of the Primary Medical Services (Scotland) Act 2004 (asp 1).

[^c22929221]: S.R. (NI) 2004 No. 142.

[^c22929231]: S.I. 2004/1022.

[^c22929241]: The website address is https://apps.nhsbsa.nhs.uk/infosystems/welcome.

[^c22929251]: Sections 390, 391 and 392 of the Companies Act 2006 (c. 46) provide that a company can have a financial year of any period between 1 day up to a maximum of 18 months, plus or minus seven days.

[^c22929261]: 1977 c. 37; section 25(3) was amended subject to transitional provisions specified in article 3 of S.I. 2005/2471 of the Patents Act 2004 (c.16), section 8(1). Section 25(4) was amended by the Patents Act 2004 (c.16), section 8(2).

[^c22929271]: 2000 c. 36.

[^c22929281]: 2002 asp 13.

[^c22929291]: 2006 c. 41; section 261(1) was amended by the Health Service Medical Supplies (Costs) Act 2017 (c.23), section 3(2)(a).

[^c22929301]: 1998 c. 11.

[^c22929311]: S.I. 2000/124 as amended by S.I. 2000/870 and 2007/1898.

[^c22929321]: As established under Regulation (EC) 726/2004 of the European Parliament and of the Council of 31 March 2004 laying down Community procedures for the authorisation and supervision of medicinal products for human and veterinary use and establishing a European Medicines Agency (OJ No L 136, 30.04.2004, p 1).

[^c22929331]: OJ No L 311, 28.11.2001, p.67; article 21 was amended by Directive 2011/62/EU of the European Parliament and of the Council of 15 December 2010 (OJ No. L 348 31.12.2010, p 74).

[^c22929341]: Registered Number 02486368. Copies of the relevant statements and standards can be obtained from the Financial Reporting Council Limited, 8th Floor, 125 London Wall, London, EC2Y 5AS or at https://www.frc.org.uk/auditors/audit-assurance/standards-and-guidance.

[^c22929351]: S.I. 2000/124 amended by S.I. 2000/870 and 2007/1898.

[^c22929361]: See section 265(7) of the 2006 Act for the definition of enforcement decision, which includes any decision relating to information that is required by virtue of an information notice under section 264A(5) of the 2006 Act.

[^c22929371]: S.I. 2007/1320 amended by S.I. 2008/1938 and 3258, 2013/325 and 2881 and 2015/233.

[^c22929381]: A record of the decisions of maximum prices which may be charged for the supply of presentations is available on a list published by the Department of Health and Social Care at https://dhexchange.kahootz.com/connect.ti/PPRS/groupHome. Copies of the list can be obtained from the Department of Health and Social Care at 39 Victoria Street, London, SW1H 0EU.

[^key-0a4dd0ce04e981641a9ccf006b1b68e8]: Words in reg. 3(1) substituted (1.7.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2025 (S.I. 2025/667), regs. 1(1), 3(2)(a)

[^key-0ce58fb2e8630435efd884dfd2419a0d]: Words in reg. 4(1) substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 9

[^key-0e60b66495e4c7ff5db767fb3de62c68]: Reg. 3(5A)-(5C) inserted (1.1.2019) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2018 (S.I. 2018/1255), regs. 1, 2(3)(d)

[^key-153e377e3af1d6739a8f4bfb3cb8d365]: Sum in Sch. 2 para. 3 Table 2 substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 15

[^key-17870085889d3df5bdd1f3d8f9d84d6b]: Reg. 21(1)(ca) inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 10(2)(b)

[^key-1eda0623adf188b5b042df3f5687533b]: Regs. 22(ga)-(gf) inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 11(c)

[^key-1f0436bbfaa61acaa090f829ea009ccb]: Words in reg. 9(10)(b) inserted (31.12.2020) by S.I. 2019/775, Sch. 8 para. 16(4)(a)(ii) (as substituted by The Human Medicines (Amendment etc.) (EU Exit) Regulations 2020 (S.I. 2020/1488), reg. 1, Sch. 2 para. 194(d)(iv)); 2020 c. 1, Sch. 5 para. 1(1)

[^key-22b999e867bed8873f07b363353d8ee6]: Reg. 3(4)(e)-(h) inserted (1.1.2024) by The Branded Health Service Medicines (Costs) (Amendment) (No. 2) Regulations 2023 (S.I. 2023/1307), regs. 1(1), 2(2)(c)

[^key-24ed7571a71b731835fe981b44e8d598]: Words in Sch. 1 para. 4 inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 14(5)

[^key-289b8c8aaca5e192758edc4fd81ae011]: Reg. 21(1)(ga)-(gf) inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 10(2)(c)

[^key-2e18fb87298f7a2548629b4d508ef40d]: Reg. 23(1C) inserted (1.7.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2025 (S.I. 2025/667), regs. 1(1), 5(a)

[^key-2f6ddcebbd036850c326a984920ada73]: Reg. 21(1)(fa)-(fc) inserted (1.1.2019) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2018 (S.I. 2018/1255), regs. 1, 2(5)(a)

[^key-38fcc0cdc1426eb87b072e124e7b2ba0]: Words in reg. 1(2) substituted (24.2.2025) by The Procurement Act 2023 (Consequential and Other Amendments) Regulations 2025 (S.I. 2025/163), regs. 1(2), 23(2)(b)

[^key-3abe3affa917abf0530f0c3349b15f27]: Reg. 3(1AB)(1AC) inserted (1.7.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2025 (S.I. 2025/667), regs. 1(1), 3(3)

[^key-3cd4435b42dc2095f20cdb0e00b057f8]: Words in reg. 1(2) inserted (24.2.2025) by The Procurement Act 2023 (Consequential and Other Amendments) Regulations 2025 (S.I. 2025/163), regs. 1(2), 23(2)(a)

[^key-425b3bf1a36225fc4920a4dfe1dc1e0c]: Words in reg. 1(2) substituted (24.2.2025) by The Procurement Act 2023 (Consequential and Other Amendments) Regulations 2025 (S.I. 2025/163), regs. 1(2), 23(2)(c)

[^key-42fde6d460097f434dc8db77bdc1b693]: Words in reg. 22(c) substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 11(b)

[^key-447c6cbc8fe933f32b5dca1fd2f10ce8]: Words in reg. 4(2)(b) substituted (1.7.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2025 (S.I. 2025/667), regs. 1(1), 4(a)

[^key-51b2e7a885a761c49e0f1eb851eb71ec]: Words in reg. 23(2) inserted (1.7.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2025 (S.I. 2025/667), regs. 1(1), 5(b)

[^key-5add6507ee71b525bc7e84ee66c5ae2b]: Reg. 3(1C) omitted (1.1.2024) by virtue of The Branded Health Service Medicines (Costs) (Amendment) (No. 2) Regulations 2023 (S.I. 2023/1307), regs. 1(1), 2(2)(b)

[^key-656a9acf92f792fd19a83bf82c71aa88]: Sch. 1 paras. 8, 9 inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 14(6)

[^key-66dff6988f9a26037adb3fba46f181c6]: Reg. 21(1A) inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 10(3)

[^key-674d64f8812942e6575272fc7d893f1d]: Reg. 3(1A) inserted (1.1.2019) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2018 (S.I. 2018/1255), regs. 1, 2(3)(c)

[^key-67d68eb0b9fda733a330b0d1c6bd93e5]: Words in reg. 1(2) inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 3

[^key-6b57841826bea22dcc3f0609275cdf97]: Words in reg. 21(1)(n) inserted (1.1.2019) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2018 (S.I. 2018/1255), regs. 1, 2(5)(b)

[^key-70617f4fba829e98f3c5ca29a1b30198]: Words in reg. 4(2)(b) substituted (1.1.2019) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2018 (S.I. 2018/1255), regs. 1, 2(4)(a)

[^key-71e260868331f2231af4fbd8e34b5666]: Reg. 22(fa)-(fc) inserted (1.1.2019) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2018 (S.I. 2018/1255), regs. 1, 2(6)

[^key-72fd0be2e511a82f7d761c24d04b9c03]: Reg. 3(1) substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 4(2)

[^key-7cb5d732f19a1717d1364417c1746eb1]: Words in reg. 3(4) substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 4(4)

[^key-8236537b07d1e013fe05783a4b38aa77]: Words in reg. 3(5H) inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 4(6)

[^key-8468b07ca8572da849749ffb9d7db236]: Reg. 3(1) Table substituted (1.7.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2025 (S.I. 2025/667), regs. 1(1), 3(2)(b)

[^key-9389b2d7a0bf8d2784a13db9762a977f]: Reg. 3C inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 7

[^key-97706a955f72e8834e7a611fc5a426d4]: Words in reg. 1 inserted (1.1.2019) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2018 (S.I. 2018/1255), regs. 1, 2(2)(b)

[^key-9b0a6f11643f71549effcfd011d567b3]: Words in reg. 23(2) omitted (1.7.2025) by virtue of The Branded Health Service Medicines (Costs) (Amendment) Regulations 2025 (S.I. 2025/667), regs. 1(1), 5(b)

[^key-9da459408de3725195b9cb3757b69520]: Reg. 3(4A) inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 4(5)

[^key-a1c916707486bb9900e82e9aeb9ea227]: Words in reg. 22(a) inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 11(a)

[^key-a60194815cd44a68c7e9dffaf98f7362]: Reg. 3(5D)-(5H) inserted (1.1.2024) by The Branded Health Service Medicines (Costs) (Amendment) (No. 2) Regulations 2023 (S.I. 2023/1307), regs. 1(1), 2(2)(d)

[^key-aa9593070dc9a4a1431e38ecc6b1009c]: Word in Sch. 1 para. 2 substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 14(4)(b)(ii)

[^key-ab1ecf931efaf7c978b66b46c6750c46]: Words in reg. 1(2) substituted (31.12.2020) by virtue of The Human Medicines (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/775), reg. 1, Sch. 8 para. 16(2)(e); 2020 c. 1, Sch. 5 para. 1(1)

[^key-b44f902dfe983d70d99dd2d70b15107f]: Sum in Sch. 2 para. 3 Table 1 substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 15

[^key-bb54f13e684c11774a179ca24c43c50a]: Words in Sch. 1 para. 1 substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 14(2)(b)

[^key-c13ae20e262664ba08b8b2c971814f47]: Reg. 3A inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 5

[^key-c28ed362aa353036cc90dbf312bec110]: Words in Sch. 1 para. 5 inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 14(5)

[^key-c30fa0bc330047731e01934b8c5e56c8]: Reg. 3(1AA) inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 4(3)

[^key-ca8e227d9beef6f59fb86de91245f80a]: Reg. 3B inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 6

[^key-ce0b5175a88cf17a51debcd0fef29e91]: Sch. 1 para. 1A inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 14(3)

[^key-ce357121af02dc6ed455019a436b79e8]: Reg. 3(1B) omitted (1.1.2024) by virtue of The Branded Health Service Medicines (Costs) (Amendment) (No. 2) Regulations 2023 (S.I. 2023/1307), regs. 1(1), 2(2)(b)

[^key-d6633be69e5ba0e9d3411dee8468916c]: Words in Sch. 1 para. 2(b) substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 14(4)(a)

[^key-d77b5c5204d0d5b9c6c96743db0a558a]: Reg. 23(1A)(1B) inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 12

[^key-d8bda40888bb4616a31c7c0de5d05e5c]: Words in reg. 1 inserted (1.1.2019) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2018 (S.I. 2018/1255), regs. 1, 2(2)(a)

[^key-da355dccfb5f4bd4f9107b5c6b60a923]: Words in reg. 26(1) substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 13

[^key-e084a0008f1726a01cc91d6b666f6f02]: Word in reg. 3(4)(d) substituted (1.1.2024) by The Branded Health Service Medicines (Costs) (Amendment) (No. 2) Regulations 2023 (S.I. 2023/1307), regs. 1(1), 2(2)(c)

[^key-e28ffc6b4431d1768380a88c5d833195]: Words in reg. 22(b) substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 11(b)

[^key-e5f50500aeca0687a89bf15e76b12b2a]: Reg. 3D inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 8

[^key-e6eea27332f84c9c7e8ccb5a98fb7cc6]: Words in Sch. 1 para. 1 substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 14(2)(a)

[^key-e74ed27078d3337a56c7cd891ff51da5]: Words in Sch. 1 para. 2 Table 2 substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 14(4)(b)(ii)

[^key-f47774a13065774aa976298620065c6d]: Words in reg. 4(3)(c) substituted (1.1.2019) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2018 (S.I. 2018/1255), regs. 1, 2(4)(b)

[^key-f542b490884a22f55f7e8b0b3f343fd1]: Words in reg. 4(3)(c) substituted (1.7.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2025 (S.I. 2025/667), regs. 1(1), 4(b)

[^key-f90a32a41f24b517560796784d1eb790]: Word in Sch. 1 para. 2 Table 2 substituted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 14(4)(b)(i)

[^key-ff16cf7244ed32296522b317d6193fc4]: Reg. 21(1)(ba) inserted (1.1.2025) by The Branded Health Service Medicines (Costs) (Amendment) Regulations 2024 (S.I. 2024/1277), regs. 1(1), 10(2)(a)

Older presentation additional payments

3A

• (1) Subject to paragraphs (2) to (4), the manufacturer or supplier responsible for the first relevant supply of an item of presentation that is an older presentation must pay in relation to the observed price decline specified in the first column of the table below, the payment percentage specified in the corresponding entry in the second column of that table of the net sales income for that item of presentation during the relevant period.

Observed price decline	Payment percentage
10% or less	25%
11%	24%
12%	23%
13%	22%
14%	21%
15%	20%
16%	19%
17%	18%
18%	17%
19%	16%
20%	15%
21%	14%
22%	13%
23%	12%
24%	11%
25%	10%
26%	9%
27%	8%
28%	7%
29%	6%
30%	5%
31%	4%
32%	3%
33%	2%
34%	1%
35% or more	0%

• (2) Subject to paragraphs (3) and (4), the observed price decline for a relevant supply made by a manufacturer or supplier of an item of presentation that is an older presentation, where the average presentation selling price for the relevant period is lower than the reference price, is one minus the quotient of the average presentation selling price for that relevant period divided by the reference price expressed as a percentage rounded to the nearest whole number.

• (3) If the average presentation selling price of an item of presentation that is an older presentation is higher than the reference price for a relevant period, the observed price decline for that relevant period is to be 10% or less and the corresponding payment percentage in the second column of the table in paragraph (1) is to apply to the net sales income of the presentation for the relevant period.

• (4) Where—

• (a) there is a commercial relationship in relation to an item of presentation that is an older presentation supplied by a manufacturer or supplier who is not an originator, originator licensee, vaccine originator or vaccine originator licensee; and

• (b) that commercial relationship is between that person and a manufacturer or supplier who is an originator, originator licensee, vaccine originator or vaccine originator licensee,

the payment percentage in Table 1 applicable to the relevant item of presentation supplied by the manufacturer or supplier in accordance with regulation 3(1AA) is to be no less than that which would apply to the originator, originator licensee, vaccine originator or vaccine originator licensee had they made the supply.

• (5) The “relevant period” in relation to the supply of an item of presentation that is an older presentation is the calendar year in which the supply is made except if, part way through the calendar year—

• (a) the presentation becomes an older presentation, in which case the relevant period is to be from the start of the next calendar quarter following the day on which the item of presentation ceased to be a newer presentation and runs to the end of that calendar year then (subject to any further application of this paragraph) each subsequent calendar year thereafter;

• (b) the supply is the first relevant supply by a manufacturer or supplier who is not an originator, originator licensee, vaccine originator or vaccine originator licensee, in which case the relevant period starts on the day of the first relevant supply of the item of presentation and runs to the end of the calendar year then (subject to any further application of this paragraph) is each subsequent calendar year thereafter; or

• (c) the manufacturer or supplier becomes liable to make a payment in accordance with regulation 3 for the first time, in which case the relevant period starts on the day after the manufacturer or supplier becomes liable to make a payment and runs to the end of that calendar year then (subject to any further application of this paragraph) is each subsequent calendar year thereafter.

• (6) In this regulation—

• “average presentation selling price” means, in relation to the supply of an item of presentation by a manufacturer or supplier during a relevant period, the quotient of the total net sales income during the relevant period divided by total quantity supplied during the relevant period (the calculation is to be based on information in the relevant presentation report, provided that the Secretary of State considers that information is accurate);

• “commercial relationship” means a contractual or other business relationship, whether or not legally enforceable, regarding the manufacturing or supplying of an item of presentation including, but not limited to, licensing;

• “reference price” has the meaning given to it in regulation 3C(9).

Meaning of newer presentation and older presentation

3B

• (1) Paragraphs (2) and (3) set out different conditions for items of presentation that are combination medicines and vaccines, but subject to those paragraphs, a newer presentation is an item of presentation supplied for health service use by a manufacturer or supplier who is an originator or originator licensee in respect of that presentation—

• (a) during the period of time there is an extant supplementary protection certificate for the active ingredient of any relevant medicine with the same relevant virtual therapeutic moiety as the presentation; or

• (b) where no supplementary protection certificate has been granted in respect of the active ingredient of any relevant medicine with the same relevant virtual therapeutic moiety as the presentation, during the period of 12 years beginning on the date on which the first marketing authorisation was granted for any relevant medicine supplied for health service use that contains the active ingredient with the same relevant virtual therapeutic moiety as the presentation.

• (2) A presentation that is a combination medicine is a newer presentation when that item of presentation is supplied for health service use by a manufacturer or supplier who is an originator or originator licensee in respect of that presentation and—

• (a) during the period of time there is at least one extant supplementary protection certificate for the same combination of active ingredients as the unique virtual therapeutic moiety for that combination medicine; or

• (b) where no supplementary protection certificate has been granted in respect of the combination medicine—

• (i) during the period of time there is an extant supplementary protection certificate for a relevant medicine that is supplied for health service use containing a constituent active ingredient or combination of constituent active ingredients of the combination medicine, or

• (ii) where no supplementary protection certificate has been granted for a constituent active ingredient or combination of constituent active ingredients of the combination medicine, during the period of 12 years beginning on the date on which the latest presentation (P1) containing any of those constituent active ingredients was granted a marketing authorisation (that marketing authorisation being the first marketing authorisation granted for a presentation containing it or them), a relevant medicine of P1 also being the first with a marketing authorisation for the virtual therapeutic moiety of that active ingredient.

• (3) A presentation that is a vaccine is a newer presentation when that item of presentation is supplied for health service use by a manufacturer or supplier who is a vaccine originator or vaccine originator licensee in respect of that presentation—

• (a) during the period of time there is at least one extant supplementary protection certificate for the vaccine;

• (b) if no supplementary protection certificate has been granted in respect of an active ingredient of the vaccine and—

• (i) the vaccine was the first presentation for the relevant virtual therapeutic moiety to be granted a marketing authorisation, during the period of 12 years beginning on the date the first marketing authorisation is granted for the presentation, or

• (ii) the licensing authority designates an active ingredient of the vaccine as a new active substance, for a period of 12 years from the date the vaccine is first placed on the market for health service use; or

• (c) if it is a line extension of a presentation to which sub-paragraph (a) or (b) applies, during the period that sub-paragraph (a) or (b) applies to the relevant presentation.

• (4) An older presentation is any item of presentation that is not a newer presentation.

• (5) A newer presentation becomes an older presentation on the day after that presentation is no longer capable of satisfying the conditions for being a newer presentation in accordance with paragraphs (1), (2) or (3).

• (6) Where a presentation is a newer presentation because paragraph (1)(a), (2)(a), (2)(b)(i) or (3)(a) applies, if the relevant supplementary protection certificate—

• (a) is invalidated for any reason, paragraph (5) applies from the day following the day on which it would have ceased to satisfy the conditions for being a newer presentation in accordance with paragraphs (1), (2) or (3) otherwise than in reliance on the invalidated supplementary protection certificate;

• (b) lapses as a consequence of the marketing authorisation to which that supplementary protection certificate relates being withdrawn, paragraph (5) applies for the period beginning on the day following the day on which the relevant marketing authorisation was withdrawn and ending on the day before the day on which the relevant marketing authorisation or supplementary protection certificate is reinstated (and so the presentation becomes a newer presentation); or

• (c) is surrendered, paragraph (5) applies from the day following the day on which the relevant supplementary protection certificate is surrendered.

• (7) The Secretary of State may, by giving an information notice, require a manufacturer or supplier to provide information to evidence that a presentation has been correctly classified as a newer presentation, older presentation or combination medicine in accordance with this regulation, including to provide any supplementary protection certificate and marketing authorisation data.

• (8) For the purposes of these Regulations, a combination medicine is a relevant medicine containing two or more active ingredients—

• (a) that has a unique virtual therapeutic moiety that is distinct from all other virtual therapeutic moieties of any of the constituent active ingredients of the relevant medicine; or

• (b) in respect of which there is no unique virtual therapeutic moiety specified in the medicines information standard, but the Secretary of State determines, by direction, the relevant medicine is a combination medicine despite not satisfying sub-paragraph (a) for the purpose of determining payments due or other pricing matters in connection with these Regulations to a manufacturer or supplier who supplies the presentation for health service use.

• (9) In this regulation—

• “period of time” in relation to a supplementary protection certificate, means the period of time beginning on the day on which the supplementary protection certificate came into force and ending on the day on which the certificate lapses or is surrendered or is invalidated for any reason;

• “relevant virtual therapeutic moiety” means—the virtual therapeutic moiety associated with an active ingredient, combination of active ingredients or combination medicine, as applicable, for a particular presentation; orwhere there is no suitable virtual therapeutic moiety in the medicines information standard for the active ingredient or combination of active ingredients for a particular presentation, the Secretary of State may, by direction, give an approximation of a virtual therapeutic moiety for the purpose of determining payments due or other pricing matters in connection with these Regulations to a manufacturer or supplier who supplies the presentation for health service use.

• (10) This regulation does not apply to a small manufacturer or supplier.

Reference prices for older presentations

3C

• (1) The Secretary of State must, by direction, determine the reference price of each older presentation to the manufacturer or supplier who has supplied that item of presentation and is liable to make a payment in accordance with regulation 3(1AA).

• (2) Whether or not the Secretary of State has received a request under paragraph (3)—

• (a) the Secretary of State may, by direction, to the manufacturer or supplier who has supplied the item of presentation, change or alter a reference price if the Secretary of State considers it is reasonable to do so; and

• (b) the changed or altered reference price is to apply, unless stated otherwise in the direction, from the date of the relevant direction.

• (3) Except where a direction under paragraphs (1) or (2) has previously been given to the manufacturer or supplier, a manufacturer or supplier who may be required to make a payment under regulation 3 during a relevant period must make a request to the Secretary of State for a reference price for each older presentation—

• (a) where the circumstances in regulation 9(1) apply, at the same time as they are required to make a notification under regulation 9(2); or

• (b) in any other circumstance where the manufacturer or supplier does not have a direction specifying the reference price for a particular older presentation, within 30 days of the manufacturer or supplier becoming aware they may be liable to make a payment under regulation 3(1AA) in respect of the presentation.

• (4) A request made under paragraph (3) must—

• (a) be made in writing;

• (b) specify the details of the presentation in respect of which the request is made; and

• (c) include any relevant information relating to the factors set out in regulation 3D(5).

• (5) Subject to paragraph (6), the Secretary of State must, by direction, within a period of 90 days following receipt of the information to be included in a request under paragraph (3) or paragraph (7), determine the reference price of the item of presentation to the relevant manufacturer or supplier.

• (6) Where the number of requests received by the Secretary of State under paragraph (3) makes it impracticable for the Secretary of State to determine the reference price to a manufacturer or supplier in accordance with paragraph (5), or insufficient information has been provided, the Secretary of State may extend that period for a further 60 days and must notify the manufacturer or supplier within the 90 day period.

• (7) Within 28 days of receiving the information to be included in a request under paragraph (3), where further information is required in order to determine the reference price, the Secretary of State must give the manufacturer or supplier an information notice specifying the further information that is required.

• (8) The Secretary of State may, by giving an information notice, require a manufacturer or supplier to provide information—

• (a) to assist in the determination of a reference price under paragraph (1) or (2) in accordance with regulation 3D;

• (b) within 28 days of receiving the information under paragraph (7) where the Secretary of State considers that further information is required to determine the reference price for a presentation; or

• (c) where the Secretary of State considers that the average selling price, maximum price or other relevant pricing information of any relevant medicine has been altered or otherwise manipulated solely or mainly for the purpose of affecting the reference price that may be applied to an older presentation.

• (9) In this regulation and regulation 3D—

• “reference price” means the price assigned to an item of presentation in a direction given in accordance with paragraph (1), (2)(a) or (5);

• “relevant period” has the meaning given to it in regulation 3A(5);

• “relevant virtual therapeutic moiety” has the meaning given to it in regulation 3B(9).

Determination of reference prices

3D

• (1) The Secretary of State must determine the reference price for an older presentation in accordance with this regulation.

• (2) The reference price for a presentation that was an older presentation on or after 1st January 2015 and is supplied for health service use by a manufacturer or supplier who is an originator, originator licensee, vaccine originator or vaccine originator licensee or a person who is in the same group as the originator, originator licensee, vaccine originator or vaccine originator licensee in relation to that presentation, where it was first made available for health service use—

• (a) before the reference anchor date, is the average selling price of the presentation during the full calendar year before the presentation became an older presentation; or

• (b) on or after the reference anchor date, is the average selling price during the full year before the presentation became an older presentation of the most relevant comparator with the same virtual therapeutic moiety as the presentation that was first made available for health service use on or before the reference anchor date.

• (3) The reference price for a presentation which was an older presentation before 1st January 2015 and is supplied for health service use by a manufacturer or supplier who is an originator, originator licensee, vaccine originator or vaccine originator licensee or by a person in the same group as the originator, originator licensee, vaccine originator or vaccine originator licensee in relation to that presentation, where it was first made available for health service use—

• (a) before the reference anchor date, is the maximum price of the presentation on the reference anchor date reduced by 12.5%; or

• (b) on or after the reference anchor date, is to be determined based on the maximum price of the most relevant comparator for the same virtual therapeutic moiety as the presentation that had been made available for sale for health service use on or before the reference anchor date, reduced by 12.5%.

• (4) The reference price for a presentation which is an older presentation and is supplied for health service use by a manufacturer or supplier who is not an originator, originator licensee, vaccine originator or vaccine originator licensee or a person in the same group as the originator, originator licensee, vaccine originator or vaccine originator licensee in relation to that presentation, where it was first made available for sale for health service use—

• (a) before the reference anchor date and—

• (i) there is an alternate presentation with the same virtual medicinal product pack available before the reference anchor date which was supplied for health service use by an originator, originator licensee, vaccine originator or vaccine originator licensee, is the maximum price of the alternate presentation on the date the presentation was first made available for sale for health service use, reduced by 12.5%, or

• (ii) there is no alternate presentation with the same virtual medicinal product pack supplied for health service use by an originator, originator licensee, vaccine originator or vaccine originator licensee on or before the reference anchor date, is to be determined based on the most relevant comparator maximum price with the same virtual therapeutic moiety as the presentation on the date the presentation was first made available for sale for health service use, reduced by 12.5%; or

• (b) on or after the reference anchor date and—

• (i) there is an alternate presentation with the same virtual medicinal product pack available before the reference anchor date which was supplied for health service use by an originator, originator licensee, vaccine originator or vaccine originator licensee, is the maximum price of the alternate presentation on the reference anchor date reduced by 12.5%, or

• (ii) there is no alternate presentation with the same virtual medicinal product pack supplied for health service use by an originator, originator licensee, vaccine originator or vaccine originator licensee before the reference anchor date, is to be determined based on the maximum price of the most relevant comparator with the same virtual therapeutic moiety as the presentation that had been made available for sale for health service use on or before the reference anchor date, reduced by 12.5%.

• (5) When determining the reference price the Secretary of State may have regard, among other factors, to any one or more of the following—

• (a) available presentations or maximum prices for presentations supplied by the manufacturer or supplier of the applicable presentation;

• (b) available presentations or maximum prices for presentations supplied by a different manufacturer or supplier;

• (c) the active ingredients, strength, excipients, pack size, method of administration or formulation of an applicable presentation;

• (d) the virtual therapeutic moiety or the virtual medicinal product pack, as applicable, of an applicable presentation;

• (e) the similarities and differences between applicable presentations to be compared; and

• (f) the period an applicable presentation has been made available for health service use before or after the relevant reference anchor date.

• (6) Where there is no or incomplete average selling price or maximum price information available for a relevant date or period for an applicable presentation, the Secretary of State may rely on any available information the Secretary of State considers appropriate for comparison purposes, including—

• (a) the closest available data for calculating average selling prices for the applicable calendar year; and

• (b) the maximum price that is the closest in date to the 1st January of the relevant calendar year as published in the medicines information standard.

• (7) In this regulation—

• “applicable presentation” means the presentation for which a reference price is to be applied or an alternate presentation to be relied on as a comparator, as the case may be;

• “reference anchor date” means in relation to—an older presentation supplied by a manufacturer or supplier who is an originator, originator licensee, vaccine originator or vaccine originator licensee of that presentation, is the 1st January of the year before that presentation finally ceased to be a newer presentation in accordance with regulation 3B; oran older presentation supplied by a manufacturer or supplier who is not an originator, originator licensee, vaccine originator or vaccine originator licensee of that relevant medicine, is the 1st January of the year before the earliest supply of a presentation for health service use by an originator, originator licensee, vaccine originator or vaccine originator licensee with the same relevant virtual therapeutic moiety as the presentation which has finally ceased to be a newer presentation; and