Drugs purchasing proposals may fail to deliver more effective treatment or greater innovation

Responding to the Goverment's consultation

Responding to the Government’s consultation on value-based drugs pricing, the NHS Confederation stresses that its members support the government’s objective to link the price of medicines with the value they provide.  

But it warns that the proposals could increase the NHS drugs bill without improving the effectiveness of treatments patients receive. 

The response says that proposals to reform the process of deciding which drugs are funded could become less transparent and 'politicised'. 

It adds that the proposals are unlikely to incentivise innovation in the production of new treatments for patients, as the Government intends. 

NHS Confederation response

The NHS Confederation’s consultation response says drugs given a ‘value-based price’ may still represent poor value for money when compared to other treatments such as early detection, surgery and radiotherapy which can be more effective investments than many high cost cancer drugs that provide late-stage respite for patients at the end of their lives. As a result, the NHS Confederation fears that costs may rise without improving the overall effectiveness of NHS treatment. 

We are also concerned by proposals for the Government to make funding decisions based on “expert advice”. Our response says that unless decisions about funding treatments on the NHS are fully transparent, they will go against government principles of openness. We say that the process may become 'politicised' and says that this would harm public confidence. 

The NHS Confederation says it is not convinced that the reforms will drive innovation in drugs provided on the NHS. In its response it says the amount of money the NHS spends on pharmaceuticals 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 commissioners paying a higher premium for drugs, and says that designing a meaningful definition of “innovation” will be difficult. 

Instead of the Government’s proposed approach to defining how drugs are priced, the NHS Confederation suggests that the National Institute for Health and Clinical Excellence (NICE), already internationally renowned in this area, should be given responsibility to develop a ‘value-based’ pricing methodology, based on robust clinical and economic evidence. We believe that NICE has the credibility, expertise and independence to deliver the government’s objectives and to overcome the problems. 

NHS Confederation chief executives response

Nigel Edwards, acting chief executive of the NHS Confederation, said: 

“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. 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. 

“The Government’s current proposals could end up with the NHS footing a large bill without much benefit to patients. The Government is trying to do the right thing but without changing course it could end up causing real difficulty for commissioners about how best to spend money on patient care.   

“At a time when NHS finances are under severe constraints, we are worried that this policy will direct resources away from ‘non-pharmaceutical’ services such as palliative nursing care, and preventative treatments which could offer greater value to a wider group of people. 

“The Government has time to get this policy in line with its original objectives. I would urge them to take the opportunity to think again.”

Further information

If you would like further information on this topic please contact Helen Crump, senior policy officer at helen.crump@nhsconfed.org.