E-drug: NICE & its implications
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Dear E-drug people,
I found a piece of interesting news on NewsEdge
(www.newspage.com) on March 2. In order to understand it better, I
would be grateful if somebody would explain the terms "co-payments"
and "loss-leader policy". Here is my summary of the text:
A health analyst, Roy Lilley, stated that "The National Institute for
Clinical Excellence [NICE] will be the most damaging thing ever to
happen to the UK pharmaceutical industry", when speaking at a
conference in London last month. Mr Lilley, a visiting fellow at the
Management School, Imperial College, London, also expressed the
view that "Nothing the government is proposing in the health care
sector is good news for the industry".
Explaining the effects of the NICE, Mr Lilley forecasted "huge
bottlenecks" in its examination and appraisal of pharmaceutical
products, due to underfunding and increasing sophistication of
products. The industry will have the NICE as its single point of entry
to the National Health Service [NHS], he said. Its appraisals of existing
products will mean the disappearance of a number of expensive
products and me-toos, as the government will want some "quick
wins" before the next general election, expected in four years' time,
there will be a "clearing out of the store cupboard". Mr Lilley's advice
to industry was to "deal with the challenge of the NICE horizontally",
basing estimates of treatment costs for comparison on calculation
including the full societal cost, ie including social services and other
non-NHS costs.
The conference was organized by Lynda Price Associates with the
intention to discuss the impact of the new NHS on the industry.
Several other subjects were covered:
:: The expected increase of "co-payments", with more products being
placed on Schedule 11 of the Medicines Act, which permits general
practitioners to prescribe restricted medicines privately, at the
patient's own risk. This was, according to Mr Lilley, hopeful news for
the pharma industry. He suggested industry should push for increased
co-payments, which would bring it closer to patients, with potential
improvements for direct-to-consumer advertising, insurance cover of
prescription drugs and discounts to chronic disease buying groups
with, as a corollary to the latter, access to patient data that
companies could now "only dream of."
:: How companies will be rewarded for innovative research, an
example being that Merck & Co's 4S trial for simvastatin has been
extrapolated to other statins, which, being cheaper, are now being
prescribed in preference to simvastatin.
:: The implementation of National Treatment Guidelines - described as
problematic for industry. Dr D'Souza, GP and head of the Unit of
General Practice at the Royal Brompton and Imperial College, president
of the Association of Independent Multifunds and a member of the
NHS advisory committee on resource allocation, discussed the impact
of PCG formularies that will, he said, imply that the industry will "lose
its loss-leader policy", under which a cheap product prescribed when
the patient is in hospital becomes more expensive when it is then
supplied by the GP.
:: Future development of pharma companies in the UK: a Mr Keith
Doran, consultant in primary care development at Doncaster Health
Authority, stated that "the challenge for industry is to embrace the
health authorities' developments and roll with them, or resist and play
for the status quo". A consistent response is unlikely, he felt,
forecasting that "some industry players could let the UK market now
wither, and focus their efforts elsewhere."<<
Staffan Svensson, MD, post-grad student
Dept of Clinical Pharmacology
Sahlgrenska University Hospital
SE - 413 45 Gothenburg
SWEDEN
e-mail: staffan.svensson@pharm.gu.se
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