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The cost of a chaotic no-deal Brexit rose today as the Health Secretary revealed that taxpayers will have to compensate drugs giants for airlifting urgent supplies to hospitals.

Matt Hancock said the Government had accepted liability for the “extra cost” if medicines have to be flown into the country to avoid possible delays at ports when the UK leaves the EU.

“We are talking to the pharmaceutical industry about the extra costs they might have to incur in that eventuality,” he told BBC radio. “Of course, I hope it doesn’t come to that.”

The admission came as EU officials played down hopes of any significant progress in talks today in Brussels between Brexit Secretary Dominic Raab and EU negotiator Michel Barnier. No press conference was expected.

Their meeting was overshadowed by claims that Mr Barnier had described Theresa May’s Chequers proposals for a future trade deal as “dead” in private talks with MPs.

Officials close to Mr Barnier denied that he had been so blunt, and the negotiator tried to soothe the row with a tweet promising that today’s meeting would seek “common ground” between the EU’s rules and the Chequers plan “with a view to creating a new, ambitious partnership”.

His withering assessment was allegedly given on Monday during a meeting with MPs on the Brexit select committee.

According to Labour member Stephen Kinnock, he made “crystal clear” that Chequers was unacceptable.

Mr Hancock insisted he was “increasingly confident” that a trade deal with the EU would be struck this year but said preparations were being made to cope with “any eventuality”.

“I am confident that if everybody does what they need to do then we can have an unhindered flow of medicines even in the event of a no-deal Brexit,” he said.

Mike Thompson, of the Association of British Pharmaceutical Industries, said: “Pharmaceutical companies are doing everything in their power to make sure patients continue to get medicines whatever the Brexit scenario — including ‘no deal’ — and have spent hundreds of millions on contingency plans.”