Feature Drug pricing

No cure, no cost

BMJ 2007; 335 doi: https://doi.org/10.1136/bmj.39267.432153.94 (Published 19 July 2007) Cite this as: BMJ 2007;335:122
  1. Andrew Jack, pharmaceuticals correspondent
  1. Financial Times, London
  1. Andrew.Jack{at}ft.com

    A drug company is set to refund the NHS if its new drug doesn't work. As pressure on healthcare budgets grows, Andrew Jack investigates the worldwide movement towards value based pricing

    The UK's medicines watchdog caused a stir last month when it announced a groundbreaking payment by results plan with the drug company Janssen-Cilag. In draft proposals on which final guidance is due in October, Janssen-Cilag will charge the NHS for bortezomib (Velcade), its new drug for multiple myeloma, only if the patients show a complete or partial response.

    It will rebate the full £25 000 (€37 000; $50 000) cost of bortezomib for those who do not respond when treated in line with the drug's indication—progressive multiple myeloma in patients who have received at least one previous drug and had, or are unsuitable for, bone marrow transplantation. This risk sharing approach is part of a broader effort by healthcare systems around the world to introduce value based pricing, in an attempt to clamp down on rising medicine costs.

    Unveiling the proposal, Andrew Dillon, chief executive of the National Institute for Health and Clinical Excellence (NICE), said: “If the drug's manufacturer accepts the proposals . . . it will mean that when the drug works well the NHS pays but when it doesn't the manufacturer should bear the cost. All patients suitable for treatment will get the chance to see if the drug works well for them.”

    The announcement was a sobering reminder that most medicines do not work in all patients. If that is the case in carefully controlled clinical trials, it is even truer in the real world, where complications and poor compliance in taking drugs correctly lower efficacy still further.

    The deal was one of the most striking examples of a tougher attitude to reimbursement around the world. NICE, set …

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