The British government and the pharmaceutical industry have struck a deal to allow flexible drug pricing arrangements, a scheme which could shave millions of pounds off the total amount that the government-funded National Health Service (NHS) pays for drugs, according to the linkurl:BBC.; Under the agreement, companies can introduce new drugs to the NHS formulary at lower initial prices, with the option of charging more if the meds prove effective. The deal is expected to save the NHS around £350 ($525) million for the next two years and around £550 ($820) million every year thereafter. The scheme imposes a 3.9% price cut for drugs sold to the NHS in February 2009 and a further 1.9% price cut in January 2010. For companies with sales of less than £25 ($37) million in 2007, however, the first £5 ($7.5) million in sales will be exempt from the price cut. These price reductions...

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