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Value through the medicines lifecycle….

Gen Technik 7

The UK’s National Institute for Health and Clinical Excellence (NICE) has had its fair share of headlines over the decade since it was created to advise the National Health Service on value for money. Dubbed (somewhat unfairly) in the US a few years ago as the body who created ‘death panels’ – committees of the great and good whose sole purpose seemed to be to deny access to important new treatments – NICE’s notoriety has often stemmed from high-profile decisions NOT to recommend particular therapies. Some of those decisions have – it must be said – flown in the face of common sense. Among the classics that have often been cited there was:  the advice that patients would have to go blind in one eye before a treatment for macular degeneration would be cost effective; another case where patients with mild Alzheimer’s disease would have to get worse before receiving treatment, simply because the cost of avoidable social care was not ‘in scope’ of their analysis; and, my favourite, a cancer treatment which – according to NICE – would not have been cost effective even if the price had been zero…Just bonkers!

But it’s not all bureaucracy gone mad and NICE has come a long way. The fact is NICE has and continues to play an important role – internationally, not just in the UK – in the debate around how medicines should be valued and how to make sensible decisions when allocating scarce resources. Flawed as some of its methods have been, it has at least been at the forefront in developing new ways to bring evidence to bear on decisions that matter for the NHS.

In June this year NICE issued some important new guidance relating to breast cancer, which I think is worth comment. Women who are deemed at risk of a particular type of breast cancer (caused by faults in one of two specific genes – BRCA1 or BRCA2) should now be offered either tamoxifen or raloxifene for up to 5 years as a preventative measure. According to Cancer Research UK women with the defective genes have between 60% and 90% chance of developing cancer. Such poor odds have led many women – including the well-publicised case of Angelina Jolie – to take the traumatic option of pre-emptive double mastectomy to ward off the disease. The new advice, then, that medicines might be an alternative solution to avoid such surgery will have come as tremendous news for the 488,000 women that NICE estimates may be eligible. But what makes this economically possible?

The key point is that both tamoxifen and raloxifen are old enough that patents have expired and are now therefore available relatively cheaply.  ‘Old’ should not in anyway be seen as pejorative in this case. These days in many cases – and across many different types of disease – it is possible to be treated adequately with medicines that have been around for some time. And this is a good thing. It generates savings for public budgets and provides the sort of financial headroom required to fund newer medicines.

It’s a point that often gets lost in the debate about the affordability and value for money of medicines. The fact is, over time, there is a reasonably well-functioning market – often referred to as the medicines life cycle – that helps keep the growth of medicines spending in check. When new medicines come on to the market they create cost. But at the same time older medicines lose their so-called market exclusivity and become cheaper due to generic competition. To a greater or lesser degree, these two opposing forces – growth from new medicines and savings from older medicines – balance each other out.

For the system to work sustainably the demand side of this market (ultimately doctors but increasingly aided by therapeutic guidelines, health technology assessment, etc) needs to look at the evidence and make sensible decisions about which patient gets which medicine. To be clear, if a patient can be treated adequately with a cheaper generic medicine they should be! Where patients can’t be treated to target with cheaper generics or when generics are not available, it may then be appropriate to use a newer medicine. There has to be room for both new and old if the system is going to be affordable and if sufficient incentives are to remain for the industry to produce new medicines for conditions that were previous not treatable. Government attempts to improve competition in off-patent medicines markets in recent years have been a good thing. Equally it is not unreasonable for the industry to point to examples of where patients who need newer medicines are denied access.

So, back to the tamoxifen/raloxifen story. This is great news. The idea that nearly half a million UK women may be able to avoid an awful (and potentially unnecessary) surgical operation is a real success story for the NHS. But we mustn’t forget that this has only been possible because someone invented those medicines in the first place. Today’s new treatments will be tomorrow’s cheap generics. We just need to make sure that healthcare systems leave room for both new and old so that the medicines life cycle can bring more good news in the future.

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EFPIA Chief Economist

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