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BMJ 2008;336:251-254 (2 February), doi:10.1136/bmj.39434.500185.25
Karl Claxton, professor of economics1,2, Andrew Briggs, Lindsay professor of economic evaluation and health policy3, Martin J Buxton, professor of health economics4, Anthony J Culyer, professor of economics2,6, Christopher McCabe, professor of health economics 5, Simon Walker, research fellow 1, Mark J Sculpher, professor of health economics 1
1 Centre for Health Economics, University of York, York, 2 Department of Economics and Related Studies, University of York, York, 3 Public Health and Health Policy, University of Glasgow, Glasgow, 4 Health Economics Research Group, Brunel University, Middlesex, 5 Institute of Health Sciences, University of Leeds, Leeds, 6 Department of Health Policy, Management and Evaluation, University of Toronto, Toronto, Canada
Correspondence to: M Sculpher mjs23@york.ac.uk
The policy debate about price, value, and innovation in pharmaceuticals is at a critical stage for the NHS. Claxton and colleagues describe the key principles of value based pricing and consider some of the concerns about such a scheme
| The first 150 words of the full text of this article appear below. |
The NHS spends about £11bn (
15bn, $22bn) annually on pharmaceuticals, of which £8bn is on branded drugs, representing about 13% and 10% respectively of available resources.1 As growth in NHS funding is expected to slow, access to innovative technologies will depend on savings found elsewhere. The UK Department of Health uses the pharmaceutical price regulation scheme to control expenditure on branded drugs. This 50 year old scheme is intended to control the profits companies can earn through periodic and general price cuts. A report by the Office of Fair Trading recommended reform, basing a drugs price on its health benefits.1 2 The government has confirmed its intention to renegotiate the existing scheme,3 and a recent House of Commons Health Committee report has also welcomed reform.4 5 The policy debate about price, value, and innovation is at a critical stage for the NHS.
Establishing the value of a drug requires an assessment
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