Fast forward

The coalition Government has wasted no time in bringing forward its plans to reform the NHS — plans on which Secretary of State for Health, Andrew Lansley, and the Conservative Party have been working for several years. The White Paper describing these changes is certainly eye-catching, but in light of all the dramatic reforms announced, the first question to address must be, 'Why change?'

One answer might be that there is concern about ever-increasing costs in the NHS, especially when there is such pressure on public expenditure. But the commitment to maintain current spending levels suggests cost is not the primary motive. Is the radical programme driven by ideological factors then?

While the White Paper makes several digs at some of the previous Government's initiatives, particularly in relation to over-centralisation and a target-driven approach, it does not read as though its motive is primarily ideological. Several times, in fact, the White Paper acknowledges that specific proposed reforms are building on steps initiated by the previous Government, stating, for instance: "The previous Government made a start on patient choice [...] we will explore how we can make rapid progress."

In most respects the direction of change is little different from what was already happening in the NHS, but what is clearly new is the pace of this change. The coalition Government has deliberately chosen to adopt a 'big bang' method rather than the tentative and incremental approach implemented for the last few years. This suggests that, as much as anything, the White Paper is born out of frustration over the fact that, despite the best intentions, little has improved.

Will it work?
This White Paper represents the biggest change in the NHS since 1974. There are still a few of us around who worked in the NHS then and can remember the two or three years of upheaval that followed. While the objective at that time was increased efficiency and better co-ordinated healthcare, it was several years before any of that was realised. Will it be any better this time around? Until we have more detail, it is difficult to say, but the risks associated with this 'big bang' approach must be high.

Medicines management and access
Medicines represented a little over 12 per cent of NHS expenditure in England, or about £11.6bn in 2008/2009. It is worth noting, incidentally, that the White Paper refers only to England. A very small footnote acknowledges that the devolved administrations in Scotland, Wales and Northern Ireland are responsible for developing their own health policies.

As figure 1 shows, medicines expenditure in primary healthcare in England over the last ten years has continued to grow, even if the rate of growth has slackened.

Figure 1: Medicines dispensed in primary care in England 1999-2009

Effective patient access to medicines in the UK is already a major challenge for pharmaceutical companies. In principle, there is free pricing for all new medicines at launch, and all licensed medicines are automatically reimbursed by the NHS. In practice it is not that straightforward. Free pricing relates only to new active substances and not to incremental improvements to existing products — one of the major sources of innovation in the current market. In reality reimbursement is far from automatic.

In England many, but by no means all, new medicines are assessed by the National Institute for Health and Clinical Excellence (NICE). Not all medicines survive that assessment: NICE recently announced that 80 per cent of its assessments resulted in a positive recommendation, but that does not provide the full picture. Of the 31 medicines for which the final recommendation has been published since January 2009, 14 (35 per cent) have been recommended for use in line with the market authorisation, and a further six with the condition of a patient access scheme. Eight were not recommended for use in the NHS, and two were recommended for restricted use.

Primary Care Trusts (PCTs) are legally obliged to ensure patient access to medicines recommended by NICE, but this does not always happen in practice. A recent study found that, of four products recommended by NICE in conjunction with a patient access scheme, uptake by PCTs varied from 100 per cent to as low as 15 per cent.

Even if a new medicine is not assessed by NICE, it will be scrutinised by the Scottish Medicines Consortium (SMC). The SMC reviews all new medicines at the time of launch, including new indications and incremental improvements in formulation, presentation or delivery. While strictly speaking its remit is to provide advice to the Health Boards in Scotland, in practice its assessments are widely referenced by PCTs in England, and have strong influence on recommendations and formulary decisions at the local level, especially for medicines not reviewed by NICE.

Non-assessed medicines
For those medicines not assessed by NICE (which is the majority of all new medicines) the path to effective reimbursement and use by the NHS is even more convoluted. There is a plethora of organisations at regional and local level that undertake health technology assessments of medicines and make recommendations on usage. Most of these organisations are funded by Strategic Health Authorities (SHAs) or by groups of PCTs, and each has its own procedure for assessing the evidence in relation to new medicines and making recommendations to its constituent PCTs. Some invite manufacturers to submit or even present the supporting evidence for the new medicine; others exclude manufacturers entirely from the process. Some of the leading medicines review groups in England are the Greater Manchester Medicines Management Group, the London New Drugs Group and the North Yorkshire RDTC (Wolfson), but this is by no means an exhaustive list.

Further to these regional groups there is also a multitude of drugs and therapeutics (D&T) committees, Clinical Priorities Groups and Area Prescribing Groups (CPG & APG), typically at PCT level. As an example of how this system works, take the Cambridgeshire Joint Prescribing Group. In September 2009 the Group assessed a recently launched medicine that had not been reviewed by NICE and recommended to commissioners and prescribers that the product be 'designated as Double Red i.e. the clinical case for its use is not proven and it is not suitable for prescribing in primary or secondary care.' In part this recommendation reflected the Cambridgeshire Group's assessment that the 'number needed to treat (NNT) was not calculable' from the publicly available data (and the company was not given the opportunity to provide additional information). This example demonstrates how, for companies bringing new products to market, navigating this alphabet soup of overlapping organisations to achieve effective market access has become more and more complex and time consuming in recent years.

Will the changes proposed in the White Paper change this situation? Probably not. There is little reference to medicines management either in the White Paper or in the supporting consultation documents. There is an explicit statement that the current pricing scheme, the 2009 Pharmaceutical Price Regulation Scheme (PPRS), will continue to the end of the agreement in 2014 and will then be replaced by value-based pricing. It is also apparent, although not explicitly stated, that responsibility for value for money in prescribing will rest with the new GP consortia.

Pricing
The concept of value-based pricing is hard to pin down. While pharmaceutical companies have been talking about delivering value for years, they have found it difficult to be explicit about what value and to whom. The idea first came to prominence in the UK with the report of the Office of Fair Trading (OFT) on the PPRS, which recommended replacing current profit and price controls with a value-based approach to pricing. This 'would ensure the prices of drugs reflect their clinical and therapeutic value to patients and the broader NHS'. The OFT defines value-based pricing as 'relating the prices of products to their clinical value relative to existing treatments', but then proposes to operate it in terms of the assessment of comparative cost-effectiveness. Many would argue that cost-effectiveness reflects a very limited definition of value and focuses on the benefit to the healthcare system rather than to the patient.

Clearly this is a debate the Government will need to engage in as it ponders the replacement of the PPRS in 2014. The proposed new Cancer Drug Fund, which is expected to be up and running from next April, will provide an opportunity to test some of the possible ideas (albeit in a therapy area with its own specific challenges) and may help elucidate some of the issues.

Meanwhile, what will GP commissioning consortia do? The Department of Health's consultation document 'Commissioning for patients' notes 'decisions on referrals and prescribing all have a major impact both on the overall quality of patient care and on the efficient use of NHS resources. We therefore propose that consortia should play a key role in working with individual GP practices to drive up the quality of primary medical care and improve overall utilisation of NHS resources.' In this respect it seems they will be taking over the advisory and monitoring functions currently performed by PCTs (or on their behalf by the plethora of organisations described above). The consortia will continue to need advice and support on this until at least 2014, and probably beyond. It seems unlikely that the consortia will want to employ staff themselves to undertake these functions, so the most likely outcome is that the various assessment bodies will remain, possibly as free-standing organisations commissioned by the consortia to support them in efficient and effective prescribing.

So while the reforms are implemented, the GP consortia are established and value-based pricing is introduced, we can look forward to several years of turmoil in the NHS. There seems little likelihood of access to medicines improving in the short term, and it is far from clear whether it will do so in the long term. Pharmaceutical companies will continue to face multiple assessments of their innovative products, and patients will continue to have inconsistently rationed access to improved products — in short, the postcode lottery lives on!

The Author
Jim Furniss is director of market access solutions at Bridgehead International

To comment on this article, email pm@pmlive.com