Draft Medical Devices and Blood Safety and Quality (Fees Amendment) Regulations

The Committee consisted of the following Members:

Chair: Sir Desmond Swayne

† Ahmed, Dr Zubir (Glasgow South West) (Lab)

† Anderson, Callum (Buckingham and Bletchley) (Lab)

† Bance, Antonia (Tipton and Wednesbury) (Lab)

Bennett, Alison (Mid Sussex) (LD)

† Brown-Fuller, Jess (Chichester) (LD)

† Carling, Sam (North West Cambridgeshire) (Lab)

† Glindon, Mary (Newcastle upon Tyne East and Wallsend) (Lab)

† Griffiths, Alison (Bognor Regis and Littlehampton) (Con)

† Hinds, Damian (East Hampshire) (Con)

† Irons, Natasha (Croydon East) (Lab)

† Johnson, Dr Caroline (Sleaford and North Hykeham) (Con)

† Leishman, Brian (Alloa and Grangemouth) (Lab)

† Owatemi, Taiwo (Lord Commissioner of His Majesty’s Treasury)

† Sewards, Mark (Leeds South West and Morley) (Lab)

† Smyth, Karin (Minister for Secondary Care)

† Stafford, Gregory (Farnham and Bordon) (Con)

† Witherden, Steve (Montgomeryshire and Glyndŵr) (Lab)

Susanna Smith, Committee Clerk

† attended the Committee

First Delegated Legislation Committee

[Sir Desmond Swayne in the Chair]

Draft Medical Devices and Blood Safety and Quality (Fees Amendment) Regulations 2025

18:00:00

I beg to move, That the Committee has considered the draft Medical Devices and Blood Safety and Quality (Fees Amendment) Regulations 2025. It is a pleasure to serve under your chairmanship, Sir Desmond. Before I turn to the detail of the statutory instrument, I would like to highlight the important role that the Medicines and Healthcare products Regulatory Agency plays in safeguarding public health, and the importance of the agency’s continuing to be properly funded to deliver its role. The MHRA is a world-leading regulator of medicines, medical devices and blood components for transfusion in the UK. It charges fees for its services; the fees are set to recover the cost of delivering a service, in line with His Majesty’s Treasury’s guidance, “Managing Public Money”. To ensure that it continues to recover its costs, it aims to update its fees every two years, which is standard practice for Government bodies that operate on a cost recovery basis, and for other regulators, here and abroad. All fees are set by taking into account various factors to reflect the cost of the activities involved in delivering a service, such as the time taken and the number and grade of staff involved; this is also informed by staff activity recording. In addition, in line with “Managing Public Money”, the MHRA includes the cost of services, of necessary corporate overheads and of system investments. Regular fee uplifts are necessary to ensure the MHRA’s long-term financial sustainability and enable it to deliver the responsive, innovative and efficient regulatory service that its customers expect, and one which protects and improves patient and public health. The draft instrument will do three main things. First, it will update the fees that the MHRA charges for its activities regulating medical devices and blood components for transfusion. These fees were last updated in April 2023. The implementation date for the proposed changes is June, and they will ensure cost recovery until 2027. Secondly, the draft instrument will introduce a fee for a new optional service: a regulatory advice meeting for medical devices. This new service will support manufacturers in interpreting regulations and requirements, particularly for complex, innovative products. Finally, the draft instrument will introduce a new payment easement for small and medium-sized enterprises for clinical investigation fees. The easements will not reduce the overall fee, which would require cross-subsidisation, but will enable the fee to be paid in two instalments, providing some flexibilities for SMEs. I should note that the draft instrument will not change the MHRA’s fees for activities relating to medicines regulation. Given the different legal positions in relation to the powers to make regulations about fees relating to medicines, medical devices and blood components for transfusion, the MHRA has used two instruments for this fees uplift. A second instrument for human medicines fees has already been laid before the UK Parliament and the Northern Ireland Assembly and has already come into force.

18:03:00

It is a pleasure to serve under your chairmanship, Sir Desmond. The draft regulations will make amendments to the Medical Device Regulations 2002, the Blood Safety and Quality Regulations 2005 and the Medical Devices (Northern Ireland Protocol) Regulations 2021. The core changes made by the draft regulations will include modifying the fees charged to manufacturers, suppliers and relevant stakeholders involved in medical device approval and blood safety monitoring. These amendments will align with updated economic assessments on the operational needs of regulatory bodies. They follow an impact assessment evaluating both the financial implications and the potential benefits for healthcare providers and patients. The fee amounts set out in the draft regulations represent increases of between 9% and 16% in the majority of fees, but some fees, primarily those relating to clinical investigations, will rise more. The fees are being set in line with the consultation document issued by the MHRA on 29 August 2024. I have a few questions for the Minister. First, the impact assessment states that the main benefit of the regulations will be the additional income gained by the MHRA, but can she elaborate further on the benefits for patients and innovators? The impact assessment also states that staff costs are the major cost for the MHRA. Will the MHRA pay the rise in national insurance contributions announced at the Budget, or will it be exempt? If it is exempt, will that mean that it does not pay the extra fees, or will it be recompensed after the fact? If it is to be recompensed after the fact, will that be based on exact figures or on an estimate? Where recompense has been based on an estimate, as has happened in schools, it has fallen very far short of what is necessary. It is critical to ensure that fees do not deter innovation, particularly among smaller medical device manufacturers, which rely on sustainable costs to continue to produce lifesaving technology. How will the Government ensure that the fee increases do not deter innovation, particularly for small and medium-sized medical device manufacturers? Could the Minister elaborate on how the fee adjustments compare with similar regulations in other countries? What measures are being taken to ensure that UK manufacturers remain competitive? The aim of the draft regulations is to increase the fees in line with cost recovery. What is the Minister doing to ensure that the MHRA is efficient and that costs are kept to a minimum? Is she satisfied that the regulatory service provided for the money is adequate? Page 3 of the impact assessment has caused me some confusion. It states that “the MHRA assumes a 2.2% pay increase for each of the next three years (2024/25 to 2026/27)”. I note that that is below inflation, which is currently running at 2.6%. Is it realistic to expect below-inflation pay rises, particularly with this Government? Does the Minister think that that figure will stand? If the fees do not provide for full cost recovery, who will foot the bill? Will the MHRA have to reduce services, or will the taxpayer have to provide more via direct grant to the MHRA? Finally, what provision is there for surveillance to monitor the impact of these fee changes on healthcare providers and patients, and whether they are enough, too much or not enough for the MHRA to cover its costs?

18:06:00

I thank the Minister for her speech. As she says, the Medicines and Healthcare products Regulatory Agency is a world-class regulator that should be innovative, transparent and truly independent, while maintaining high standards and always putting public health first. In recent years, however, confidence in MHRA standards has been undermined by the Primodos, vaginal mesh and infected blood scandals. It is crucial that we ensure that those mistakes are never repeated, and that the MHRA regains the public’s trust. The MHRA has suffered from insufficient staffing levels and inflexibility around funding and resourcing, and patients are the ones paying the price. The Government should aim for nothing less than halving the time in which new treatments reach patients for life-threatening conditions such as cancer. The Liberal Democrats therefore support additional resource for the MHRA, but that must go hand in hand with greater capacity and a stronger service to address past failings. Can the Minister confirm that when the regulations are made, we will see an increase in the speed at which patients receive treatments? Can she tell us when that improvement will be delivered? Concerns were expressed during the consultation that fee hikes, some of which exceed inflation, will stifle innovation and undermine important research. What assurances can the Minister provide that there will be no deterioration in the number or quality of new products? Is she confident that payment waivers and easement measures are sufficient to stop small and medium-sized enterprises significantly cutting back their activity?

18:08:00

I thank the hon. Members for Sleaford and North Hykeham and for Chichester for their comments, which I will try to address. As I think everyone agrees, the MHRA provides essential services that play a crucial public health role, and it is important that it recovers its costs, which is what these fee increases are set to do. The main benefit of the draft regulations will be that patients and innovators have the faster and better-delivered service that has been committed to. I meet the MHRA regularly, and I will be meeting with the new chief executive and chair later this week to make sure that the improvement that we have seen recently continues. I know that the whole House is interested in that, because, like all regulators, the MHRA is a huge contributor to the growth that we want to see as part of our growth agenda. I expect patients and the industry to see the impact. Recovering the fees is crucial. It is also right that the regulated bear the cost of regulation, rather than it falling to UK taxpayers to subsidise it. By supporting the draft regulations, we will ensure that the MHRA continues to contribute to the Government’s health mission, balancing the responsibilities to maintain product safety and to champion innovation. It has made progress in responding to the recommendations set out in Baroness Cumberlege’s independent medicines and medical devices safety review. It has listened carefully to the people who gave evidence and to the findings of the independent review team, which are a matter of concern to many Members and constituents across the country, as the Liberal Democrat spokesperson, the hon. Member for Chichester, quite rightly highlighted. The MHRA is committed to bringing about the changes that have been identified and to achieving ambition to be a regulator that absolutely delivers for UK patients, as well as delivering at speed to give confidence to the industry. We absolutely do not want to deter innovation; that is why in the draft regulations we are making some changes to support SMEs, which may find regulation more burdensome. We will keep that under review. We expect the organisation to look closely at staff costs and make sure, like all organisations, that it produces the efficiencies needed to deliver a good service.

Before the Minister concludes, could she answer my questions on national insurance and on below-inflation pay rises? If not, will she commit to answering my remaining questions by letter?

I am happy to answer any questions, but as far as I am aware, they are NHS-employed staff, so they will be dealt with in the usual way. I am happy to write to the shadow Minister with any specifics if that is helpful. In conclusion, the draft regulations are important to ensure that the MHRA has the resources that it needs to continue delivering reliable services and its public health role. I commend them to the Committee. Question put and agreed to.

18:12:00