The U.K.'s National Institute for Clinical Excellence (NICE) will likely no longer have any role in drug cost-effectiveness decisions after 2013, according to officials.
Instead, a new value-based pricing system will set drug prices to reflect a product's value at the outset, without the need for NICE to carry out its assessment once a drug already is available.
Such was the picture painted by U.K. government ministers at an event sponsored jointly by the pharmaceutical and biotech industry associations - the Association of the British Pharmaceutical Industry and the BioIndustry Association - at the Royal Society of Medicine on Oct. 25 in London.
Value-Based Pricing From 2013
The new pricing system will in theory come into force at the start of 2014, when the current Pharmaceutical Price Regulation Scheme (PPRS) contract between industry and government expires. By and large, PPRS allows free pricing up front, but imposes a cap on company profits that effectively limits the scope companies have to set high prices. (Fears that Britain's new Conservative/Liberal Democrat coalition government would not honor the current PPRS contract to its term were allayed by Science and Universities Minister David Willetts.)
Under value-based pricing, the price of a drug would reflect "everybody's agreed perception of the value provided," Lord Howe, Parliamentary Under Secretary of State at the Department of Health, said at the event. "If we get there," he continued, "NICE's opinion [on the cost-effectiveness of particular drugs] would be "somewhat redundant."
Given that the new system is still under discussion, plenty of questions remain - not least including who is "everybody" and how and when they might "agree" on the value a drug provides. "It's too early to speculate on what the new value-based approach will look like," notes ABPI Director General Richard Barker, "as the devil will certainly be in the details."
But the principle - linking value with price more closely and at the time of pricing, thus blunting NICE's ability to scupper a drug's hopes post hoc - has to be music to the ears of most drug manufacturers." As is the fact that industry is, in Barker's words, "co-creating" the scheme with the government.
More than a few drug manufacturers have received negative or highly restrictive opinions from NICE, thereby severely limiting their products' availability to U.K. patients and by extension their commercial potential.
Recent examples include the June 2010 rejection of GlaxoSmithKline PLC's lapatinib (Tyverb) for advanced breast cancer, that of Novartis AG's everolimus (Afinitor) for kidney cancer in July and September's spurning of GSK's clotting disorder drug eltrombopag Revolade.
Even use of Novo Nordisk AS's novel once-daily diabetes drug liraglutide (Victoza), approved and apparently growing strongly in most main markets, may be reimbursed in the U.K. only for certain defined patient groups and as part of pre-defined treatment regimens, and may be continued after six months only if blood glucose levels have fallen by at least 1%. ('U.K.'s Cost-Effectiveness Watchdog Backs Novo Nordisk's Victoza,' The Pink Sheet DAILY, Sept. 10, 2010).
It's hardly surprising, then, that the industry association ABPI already had been calling for a change in NICE's remit. As outlined in a release earlier in October, it wants to broaden the agency's definition of value to "capture all the key elements of health care innovation, and reflect uncertainties in early assessment of medicines in value ranges," and to refocus NICE's attention on clinical best practice and quality standards (and, therefore, away from single drug or technology assessments). The ABPI on behalf of the drug industry argues that NICE's rigorous cost-effectiveness calculations, although "pioneering", are too narrow and don't sufficiently capture the broader value that medicines provide in improving patient outcomes.
The criticisms follow on in part from the conclusions of an independent report of NICE's methodology, published in 2009 by Sir Ian Kennedy, professor of health law, ethics and policy at University College London. ('NICE Enough? Watchdog's Basic Approach Is Sound, But More Transparency is Urged,' 'The Pink Sheet' DAILY, July 23, 2009).
NICE To Play Broader Role in Setting Quality Standards
It appears from Lord Howe and David Willetts' comments that the ABPI's lobbying efforts have been successful. "The [current] system doesn't promote innovation or access to medicines to the degree we'd like. We need a closer link between price and value," asserted Willetts at the Royal Society of Medicine meeting.
No one will declare NICE dead, though - far from it - nor will they admit that its future role will be a lesser one. Instead, "we're looking for a changed role for NICE ... a more advisory role," said Willetts in response to a question during a press conference. "We're not saying it's less powerful," he asserted.
Indeed, NICE's role in issuing guidelines around quality standards in health care more generally, including in social care, will increase - albeit effectively at the expense of its cost-effectiveness efforts.
That's the way industry wants it, though. "The expansion of NICE's remit to promote clinical best practice is a higher priority for the future of the NHS [National Health Service] than the overly narrow cost effectiveness calculations on new medicines that it current conducts," noted Barker.
Thus is appears that, at least as far as industry's concerned, NICE post-2013 will be significantly less powerful - and probably much less controversial too.
Therapeutic Clusters Announced
Also at the Oct. 25 event, Willetts announced the launch of two pilot therapeutic clusters in the U.K., in inflammatory/joint disease and respiratory inflammatory disease. The idea is that academics, clinicians and industry team up to provide a single hub of expertise in early drug development, a single interface for partners in these areas, as well as faster access to patients for clinical trials (through unified clinical trial approval sign offs, for instance) and less bureaucracy overall.
These first two clusters - approved a week earlier after a multi-stage competitive submission process will be followed by others as part of a broader Therapeutic Capability Clusters initiative. This is one means by which the U.K. hopes to claw back some of the ground it has lost (along with many other European and Western countries) as an attractive location for research and clinical trials.
The U.K. government earlier in October announced that it would invest up to £50 million over the next five years in the Stratified Medicines Innovation Platform - a project designed to stimulate innovation in areas that will promote and accelerate the development of personalized medicines, such as biomarker development and tumor profiling.
These moves come against the backdrop of U.K. R&D escaping relatively lightly from the government's spending review ('Pharma Innovation and NHS Dodge Axe in Spending Review; But There Is a Price to Pay,' 'The Pink Sheet' DAILY, Oct. 21, 2010).
-Melanie Senior (firstname.lastname@example.org)