LONDON, March 20 (Reuters) - The pharmaceutical industry

on Thursday blasted the UK government's levy that aims to curb

the national health system's drugs bill, arguing it is

unsustainable and is halting companies from making future

investments in the country.

The Association of the British Pharmaceutical Industry,

including big pharma companies AstraZeneca ( AZN ), Roche

and Pfizer ( PFE ), said in a joint statement that the

five-year agreement reached with the government in late 2023

needed to be fixed because companies cannot afford the record

rebates they are paying to the National Health Service (NHS)

England.

The industry group said the medicines access scheme known as

VPAG, or Voluntary Scheme for Branded Medicines Pricing, Access

and Growth, is forcing them to pay between a quarter and a third

of revenues from drug sales in the country back to the NHS. That

percentage is up from around 5% of revenue that companies paid

in 2021, under a previous agreement.

The UK government is highlighting life sciences as one of

the sectors with the biggest growth potential and intends to

make it a core element of its new industrial policy. The ABPI

said that plan will fail without changes to the clawback scheme.

Relations between the pharma industry and the government

over the scheme and other policies have long been contentious.

British drugmakers GSK and AstraZeneca ( AZN ) have for

years criticised the UK business investment climate. AstraZeneca ( AZN )

in January scrapped plans to invest 450 million pounds ($584.96

million) in its vaccine manufacturing plant in northern England,

citing a cut in government support.

($1 = 0.7693 pounds)