England 2023/24
Published 7 November 2024
Key findings
These figures are all Actual Costs. A definition of this measure can be found in section 1.3 Definitions.
The total cost to NHS commissioners in England for the issue of medicines, appliances, and medical devices in 2023/24 is estimated to be £19.9 billion. This includes a deduction of £631 million for central rebates.
The cost to NHS commissioners before central rebates was £20.6 billion, an increase of 7% from £19.2 billion in 2022/2023.
This £20.6 billion is made up of:
- £10.1 billion for medicines prescribed in primary care and dispensed in the community
- £10.3 billion for medicines issued in hospitals
- £98.4 million for medicines prescribed in hospitals and dispensed in the community
- £32.8 million for medicines prescribed by dentists and dispensed in the community
- £26.8 million for medicines prescribed and dispensed in the Adult Secure Estate
1. Things you should know
1.1 Scope
This publication includes :
prescriptions issued by GP practices and community prescribers in England, that were dispensed in the community in the UK (excluding Northern Ireland)
prescriptions issued by hospitals in England, that were dispensed in the community in the UK (excluding Northern Ireland)
prescriptions issued by dental practitioners, that were dispensed in the community in the UK (excluding Northern Ireland)
medicines issued in hospitals in England, that were dispensed via the hospital pharmacy, homecare companies, or outsourced outpatient pharmacy partnerships
medicines prescribed and dispensed in the Adult Secure Estate
This publication does not include :
prescriptions issued through Armed Services health services in England commissioned by NHS England (NHSE) but not dispensed in the community
medicines issued in hospitals in England but not managed via the hospital pharmacy service
dressings and devices issued in secondary care, since supply of these is usually made via the NHS Supply Chain
This publication gives :
cost breakdowns by financial year and month within each setting
cost breakdowns by BNF Chapter and BNF Section level by financial year and setting
financial year cost breakdowns in each setting by Integrated Care Board (ICB)
a view of the data down to financial year, BNF Chapter, BNF Section and ICB combined
1.2 Data sources
Data for this publication is collated from two sources, the NHSBSA Enterprise Data Warehouse, and the Define system operated by Rx-Info.
We obtain data for prescription items dispensed in the community from the NHSBSA Enterprise Data Warehouse, in two different cost measures, Net Ingredient Cost (NIC) and Actual Cost. Full definitions for these measures can be found in section 1.3 Definitions. Actual Cost is used in these statistics alongside NIC to give a more complete picture of the total cost to NHS commissioners for the prescribing of medicines, appliances, and medical devices.
We obtain data for secondary care from Rx-Info. Rx-Info collect data from hospital pharmacy systems, including the actual costs paid with discounts. The data used for this publication was extracted from the Rx-Info Define system on 24 October 2024.
For breakdowns below national totals, such as ICB or BNF section, costs for prescription items dispensed in the community are measured using NIC due to limitations of the quantity Actual Cost.
Data for Central Rebates is provided by the Medicines Value and Access Directorate, a part of NHS England. It is not possible to include the central rebates in the figures broken down by ICB or BNF category owing to commercial confidentiality. The central rebate figure includes rebates from arrangements NHS England have agreed with pharmaceutical companies following successful negotiations to commission a variety of treatments both in the cancer drugs fund (CDF) and in routine commissioning. This includes treatments for both rare diseases and more common conditions.
1.3 Definitions
Actual Costs Within Secondary Care
By costs within hospitals we mean the Actual Cost (including applicable VAT but after any discount) of medicines, appliances, and medical devices issued in NHS hospitals in England by hospital pharmacies.
Actual Costs Within Primary Care
For prescription items dispensed in the community, Actual Cost is the
cost recharged to NHS commissioners for the provision of drugs,
appliances, and medical devices by dispensing contractors. Actual Cost
is calculated as the basic price of the drug minus the National Average
Discount plus Payment for Consumables plus Out of Pocket Expenses plus
Payment for Containers. Payment for Consumables was previously known as
container allowance.
Actual Cost does not reflect the payment
made to a dispensing contractor for the cost of the individual drugs
dispensed, and excludes other fees paid that a prescription item may
attract.
National Average Discount Percentage (NADP)
The NADP is calculated using the discount rates applied to individual dispensing contractors according to the Drug Tariff for England and Wales for Pharmacy and Appliance contractors and the General Medical Services Statement of Financial Entitlement Annex G Part 1 for Dispensing Doctors and Personal Administration accounts.
Net Ingredient Cost (NIC)
Net Ingredient Cost (NIC) for prescription items dispensed in the community is either the basic price given either in the Drug Tariff, or is determined from prices published by manufacturers, wholesalers or suppliers. Basic price is set out in Parts VIII and IX of the Drug Tariff. For drugs not in Part VIII, the price is usually taken from the manufacturer, wholesaler or supplier of the product. Basic price also includes retained margin, where applicable. The retained medicine margin contributes to the provision of pharmaceutical services alongside the other agreed fees and allowances.
Adult Secure Estate
By Adult Secure Estate we mean adult prisons and detention centres. See also section 4.9 for more information.
British National Formulary (BNF)
These statistics use the therapeutic classifications defined in the BNF, to group medicines together based on their primary therapeutic indication. The NHSBSA uses and maintains the classification system of the BNF implemented prior to the release of edition 70, including the six pseudo BNF chapters (18 to 23) created by NHS Prescription Services to classify products that fall outside chapters 1 to 15.
Integrated Care Board (ICB)
ICBs are statutory organisations responsible for bringing the NHS together locally to improve population health and establish shared strategic priorities within the NHS. ICBs took over the functions of Sustainability and Transformation Partnerships (STPs) in July 2022.
Item
Prescribing volumes are not included in this publication. Unlike in primary care, where item level data is available, in secondary care, data is collated as quantities issued. The concept of a prescription item does not exist for secondary care medicines data.
2. Results and commentary
The charts in this report are interactive. You can choose the categories to display in a chart by clicking them in the legend. For more information on using these charts please see section 4.10.
All figures in this section are before the deduction of the central rebates.
2.1 Costs by setting
Figure 1: Actual Cost for items dispensed in the community, issued in hospitals, or dispensed in the Adult Secure Estate
Cost measure used in Figure 1
These figures are all Actual Costs.
Source: Summary Tables - Prescribing Costs in Hospitals and the Community - Table One
The Actual Cost of items prescribed in primary care in England in 2023/24 was £10.1 billion, 49.1% of total expenditure.
The Actual Cost of items issued in hospitals in England in 2023/24 was £10.3 billion, 50.1% of total expenditure.
In 2019/20 the Actual Cost of items prescribed in primary care in England was £8.48 billion, 53.8% of total expenditure. The Actual Cost of items prescribed in primary care has been gradually increasing since 2019/20.
In 2019/20 the Actual Cost of medicines issued in hospitals in England was £7.14 billion, 45.4% of total expenditure. The Actual Cost of medicines issued in hospitals has also been gradually increasing since 2019/20.
Figure 2: Net Ingredient Costs (NIC) for items dispensed in the community
Cost measures used in Figure 2
These figures are Net Ingredient Costs (NIC) for items dispensed in the community, and Actual Costs for those issued in hospitals and the Adult Secure Estate.
Source: Summary Tables - Prescribing Costs in Hospitals and the Community - Table Two
The NIC of items prescribed in primary care in England in 2023/24 was £10.7 billion, 50.5% of total expenditure.
The Actual Cost of medicines issued in hospitals in England in 2023/24 was £10.3 billion, 48.7% of total expenditure.
There was a 4.8% increase in the NIC of items prescribed in primary care in England in 2023/24 of £486 million from £10.2 billion in 2022/23. There was a 17.8% increase of £1.6 billion from £9.1 billion in 2019/20. The Net Ingredient Cost (NIC) of items prescribed in primary care has been gradually increasing since 2019/20.
There was an 8.6% increase in the Actual Cost of medicines issued in hospitals in England in 2023/24 of £817 million from £9.5 billion in 2022/23. From 2019/20 to 2023/24 there was a 44.3% increase in the Actual Cost of medicines issued in hospitals in England. The cost of medicines issued in hospitals has also been gradually increasing since 2019/20.
In 2023/24 the total expenditure on drugs, dressings, appliances and medical devices was £21.2 billion, where total expenditure is the sum of the NIC of items dispensed anywhere in the community and the Actual Cost of items issued within hospitals. This was a 6.6% increase of £1.31 billion from the £19.9 billion costs in 2022/23 and a 29.4% increase of £4.81 billion from the £16.4 billion costs in 2019/20.
2.2 Costs by BNF Chapter
Figure 3: Costs by BNF Chapter in the 2023/2024 financial year
Cost measures used in Figure 3
These figures use Net Ingredient Costs (NIC) for items dispensed in the community, and Actual Costs for those issued in hospitals.
Source: Summary Tables - Prescribing Costs in Hospitals and the Community - Table Five
In 2023/24 £3.36 billion was the highest Actual Cost within hospitals on any one BNF chapter. This was for Chapter 8 Malignant Disease and Immunosuppression.
In 2023/24 £1.87 billion was the highest NIC within primary care on any one BNF section. This was for Chapter 6 Endocrine System.
In 2023/24 £408 million Actual Cost within hospitals was for medicines not accounted for under a BNF chapter.
In 2023/24 was 32.6% of the the Actual Cost of medicines issued in hospitals in England was for BNF Chapter 8 Malignant Disease and Immunosuppression. Chapter 8 is also the BNF Chapter with the highest costs across all combined settings in 2023/24, at £3.54 billion. This was 16.7% of the total costs of £21.1 billion, where total expenditure is the sum of the NIC of items dispensed anywhere in the community and the Actual Cost of items issued within hospitals.
In 2023/24 was 17.5% of the the Actual Cost of medicines issued in hospitals in England was for BNF Chapter 6 Endocrine System.
Within hospitals, the medicines not accounted for under any of the BNF Chapters are drugs manufactured as specials, dressings, appliances and medical devices which are not listed in the Dictionary of Medicines and Devices.
Figure 4: Top 10 BNF Sections by costs across all settings in the 2023/2024 financial year
Cost measures used in Figure 4
These figures are Net Ingredient Costs (NIC) for items dispensed in the community and Actual Costs for those issued in hospitals.
Source: Summary Tables - Prescribing Costs in Hospitals and the Community - Table Six
In 2023/24 £2.5 billion was the total Actuals Costs in hospitals for section 0801 Cytotoxic Drugs.
In 2023/24 £1.5 billion was the total NIC in primary care dispensed in the community for section 0601 Drugs Used in Diabetes.
2.3 Costs by ICB
Figure 5: Costs by ICB in the 2023/2024 financial year
Cost measures used in Figure 5
These figures are Net Ingredient Costs (NIC) for items dispensed in the community, and Actual Costs for those issued in hospitals.
Source: Summary Tables - Prescribing Costs in Hospitals and the Community - Table Seven
The average costs across all identified ICBs was £502 million.
Data under ‘Unknown ICB’ are costs in both primary and secondary care which we were not able to map to an ICB. In 2023/24 this accounted for £5.7 million.
Data for prescriptions prescribed by dentists and dispensed in the community has not been included in Figure 6 because dental data is captured under a national code and not available at ICB level.
ICB costs in secondary care are allocated to the ICB in which the hospital is located. However, not all the costs are for patients living in that ICB. For example, patients may be referred to a hospital outside of their usual ICB of residence.
Figure 6: Average costs per capita by ICB in the 2023/2024 financial year
Cost measures used in Figure 6
These figures are Net Ingredient Costs (NIC) for items dispensed in the community, and Actual Costs for those issued in hospitals.
Source: Summary Tables - Prescribing Costs in Hospitals and the Community - Table Seven
£367 was the cost per capita for items issued in all settings in England in 2023/24.
The cost per capita for items issued in all settings in England in 2023/24 increased by 5.53% from £348 in 2022/23. There was an increase in cost per capita of 26.2% from £291 in 2019/20.
3. Changes to this publication
This November 2024 edition of the publication uses an updated Actual Cost for prescription items dispensed in the community. Between October 2022 and January 2024 the discount deduction applied to pharmacy contractors transitioned to new arrangements. You can see more information about these transitional arrangements and the new arrangements in Part V of the Drug Tariff for England and Wales.
This means that some figures for the years 2022/23 differ from those reported in previous editions. For example, the total Actual Cost for 2022/23 reported in this current edition is 0.2% less than reported in the previous edition.
For full details of the changes made please refer to the Background Information and Methodology document released alongside these statistics.
The NHSBSA has worked with the DHSC to improve the categorisation of Nutritional Borderline Substance (NBS) products. It is part of a system-wide move towards interoperability. As part of the recategorisation work for NBS some data may appear against historical BNF codes. You can find out more about this project including a list of the BNF code changes carried out on this page of the NHSBSA website.
4. About these statistics
4.1 Uses of these statistics
These statistics have a variety of uses, including:
obtaining a national view of costs for prescriptions dispensed in hospitals and the community in England across the financial year
analysis of cost trends by BNF Chapter, BNF Section and ICB
public scrutiny of national prescribing habits
4.2 British National Formulary (BNF)
The primary care data used in this publication comes from the NHSBSA Enterprise Data Warehouse (EDW). This includes the breakdown into BNF Sections. The data for secondary care is provided by Rx-Info. Rx-Info use an extract from the Dictionary of Medicines and Devices (dm+d) to obtain BNF classifications.
4.3 Time periods reported on by this publication
This publication presents data from April 2019 to March 2024.
4.4 Geographies used by this publication
Integrated Care Boards (ICB) are health geographies are formed by NHS organisations, local councils and others, to set out proposals to improve health and care for the local population.
In primary care data the ICB geographies shown use NHSBSA administrative records, not geographical boundaries, and more closely reflect the operational organisation of prescribing organisations than other geographical data sources. Within the secondary care data ICB is provided by Rx-Info who use the NHS Digital Organisation Data Service (ODS) as their source.
4.5 Population statistics included in this publication
This publication uses two population datasets. The first of these lists the mid-year total population of England, as sourced from the edition “Mid 2011 to mid-2023 detailed time series” of the ONS dataset Estimates of the population for England and Wales. For the population of financial year A/B, we use the mid-year population of year A.
The second population dataset used in this publication lists mid-year populations of ICBs in England, as sourced from the ONS mid-year health geographies population estimates. ICBs took effect in July 2022, and so we have obtained ICB population data for earlier years by rolling up the populations of Lower layer Super Output Areas (LSOAs). ICB populations are not yet available for 2023, and so for 2023/2024 we have repeated the 2022/2023 populations.
The sum of the populations of all ICBs in the second dataset is only identical to the all-England populations in the first dataset for 2021/2022. This is because the source datasets were released at different times.
4.6 Per capita costs
Per capita cost is the cost per person in a given area (England, ICB), calculated by dividing the area’s total cost by its total population.
4.7 Planned changes to this publication
This is an Official Statistics publication. We regularly review the content of our publications to make sure that they remain relevant to our users. More information on how users can give us their feedback can be found in section 6 of this summary.
4.8 Monthly Secondary Care Medicines Data (SCMD)
In addition to this publication, the NHSBSA also release a monthly data set for Secondary Care Medicines Data, via the Open Data Portal (ODP). The ODP is the platform where we host our open data products. The monthly data set is produced from data provided by Rx-Info. This data set lists indicative costs rather than Actual Costs. Indicative costs are derived from current medicines pricing data held in NHSBSA data systems including the Common Drug Reference (CDR) database and Dictionary of Medicines and Devices (dm+d) calculated to a Virtual Medicinal Product (VMP) level.
4.9 Adult Secure Estate data
Cost figures for medicines prescribed and dispensed in the Adult Secure Estate are the aggregate spend on medicines dispensed to patients in adult prisons and detention centres. Health services to patients who are in prison or detention are supplied under contract commissioned by NHS England Specialised Commissioning Directorate. A breakdown of spend by BNF chapter is not currently available.
In this publication, prescription costs in the Adult Secure Estate are always measured by Actual Cost, not Net Ingredient Cost (NIC). Note that data is only available from 2020/2021 onwards, and that values are to the nearest thousand GBP. This data is provided by NHS England.
4.10 Charts in this publication
The charts in this report are interactive, and allow you to choose which categories are displayed. If the name of a category is greyed-out in the legend, then that category is not displayed in the chart. Clicking on the name of the category, in the legend, will toggle between greyed-out and not greyed-out. So, for example, if you want Figure 1 to show only the category ‘Issued in hospitals’, click on items in the legend until this is the only category that is not greyed-out. To see the full effect of changes you make, move the pointer away from the legend. Notice that when more than one category is displayed, the bars are stacked, showing how the total of those categories is broken down.
4.11 Medicines
In this publication we use ‘medicines’ as a short-hand for ‘medicines, appliances, dressings, and medical devices’.
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6. Feedback and contact us
We invited feedback on the changes made to the Prescribing Costs in Hospitals and the Community Official Statistics publication, including the change of data source. The consultation took place between 15 November 2021 and 4 February 2022. You can find details of this consultation on our website.
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