Plans to change the way NHS agrees drug prices could push up costs without boosting effectiveness, trusts warn
Plans by the health secretary, Andrew Lansley, to change the way the NHS agrees drug prices with pharmaceutical companies could leave the health service footing a large bill with no real benefit to patients, the government has been warned.
The NHS Confederation, which represents NHS trusts, says the government is right to pursue pricing based on "value", but says the scheme risks pouring money into new drugs at the expense of preventing disease or providing palliative care.
"The current process is not perfect and pricing based on value is good in principle. But this is a case of a good idea that has turned into poor policy," said Nigel Edwards, acting chief executive. "We simply don't see that the process suggested will achieve what the government wants. These proposals could push up costs without increasing effectiveness, damage public confidence in the decision-making process and fail to spark greater innovation."
Lansley has said he intends to stop the National Institute for Health and Clinical Excellence (Nice), from banning ineffective and expensive new medicines from use in the NHS.
Until now, Nice has based its decisions on cost-effectiveness and has ruled that some drugs offer too little benefit to the patient to justify the high price. This has proved controversial where the treatment is for a terminal disease, such as cancer, and offers a few more weeks of life, albeit for tens of thousands of pounds.
Nice does not set prices but, where companies' drugs have been turned down, they have increasingly offered to reduce the cost to the NHS through special-access schemes, where the manufacturer may pay after a patient has received a certain number of treatments.
Companies at present set the price of their drugs but the amount of money they can earn in a year from the NHS is capped under the pharmaceutical price regulation scheme. Lansley wants to replace this with value-added pricing, which would see Nice give guidance on cost-effectiveness, but then allow the price to be negotiated between the company and the Department of Health, making allowance for the innovative nature of the drug and the research and development the company has put in, as well as any social benefit, for instance in relieving the burden on carers.
But in its response to the government's consultation on value-based pricing, the confederation says this process may not be transparent and risks becoming political. It also does not believe that it will act as an incentive to companies to be innovative ? designing the drugs that are needed rather than copying the blockbusters of their rivals.
The amount of money the NHS spends on pharmaceuticals, it says, is not "of a sufficient scale to affect the behaviour of a sector populated by multinational organisations with annual turnovers of tens of billions of dollars". It questions whether innovation should justify paying a higher premium for drugs and suggests that Nice be asked to design a new pricing scheme.
One patient group, Myeloma UK, said it had reservations about the scheme. "It may seem a good idea to pay a higher price for drugs that provide wider societal benefits ? for example, getting people back to work ? but this will undoubtedly benefit some groups of patients more than others. We have to recognise all the likely consequences of a reward system and be absolutely sure that it reflects what society wants the NHS to pay more for," said chief executive Eric Low.
The Association of the British Pharmaceutical Industry broadly welcomes the scheme but says much of the detail has yet to be worked out.
Source: http://www.guardian.co.uk/society/2011/mar/17/nhs-trusts-andrew-lansley-drug-pricing
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