Intended for healthcare professionals

Education And Debate

An integrated national pharmaceutical policy for the United Kingdom?

BMJ 2000; 321 doi: https://doi.org/10.1136/bmj.321.7275.1523 (Published 16 December 2000) Cite this as: BMJ 2000;321:1523
  1. Tom Walley, professor of clinical pharmacology (twalley{at}liv.ac.uk)a,
  2. Alan Earl-Slater, visiting lecturerb,
  3. Alan Haycox, senior lecturera,
  4. Adrian Bagust, senior research fellowa
  1. a Prescribing Research Group, Department of Pharmacology and Therapeutics, University of Liverpool, Liverpool L69 3GF,
  2. b Department of Commerce, University of Birmingham, Birmingham B15 2TT
  1. Correspondence to: T Walley
  • Accepted 20 July 2000

The UK government wishes to have “joined up” policies to integrate areas such as health and social care. Although many of these policies impinge on pharmaceuticals (box below), there is no coherent, integrated, national pharmaceutical policy. As a result, some policies affecting pharmaceuticals seem to contradict or undermine others. Pharmaceuticals raise issues which are not evident in other areas of health provision:

  • Pharmaceuticals are regulated by law for safety, efficacy, and quality

  • Drugs have become increasingly expensive, both individually and in total, but the value derived from some of this expenditure is open to question

  • Drugs are promoted actively by a powerful industry that is also a major employer and exporter in the United Kingdom

  • Drugs are affected by policies in almost every area of health care.

We believe that there should be a single, clear policy on pharmaceuticals that unifies the various strands of relevant existing policies. In this article we try to describe what such a policy might look like.

Summary points

  • Medicines are important in NHS treatment and they are expensive

  • The pharmaceutical industry is important for the NHS and for the UK economy

  • The United Kingdom has no single, coherent, pharmaceutical policy

  • Recent difficulties have arisen in part from the lack of such a policy

  • The establishment of the NICE and other recent policies on quality could provide the basis of a national pharmaceuticals policy

Some existing UK policies affecting pharmaceuticals1

Medicines Act 1968, and revisions

Intellectual property rights

Advertising of drugs

Prescription charges

Profit controls

NICE

Computer assisted prescribing support systems—for example, PRODIGY

Generic prescribing targets set by central government

Commercial competition

Trade and parallel imports

Selected list

Drug tariff

Pharmaceutical price regulatory system supporting industry while controlling profits

Consumer Protection Act

Product liability directive

Recent problems

The lack of a single policy on drugs has caused problems, and attempts to resolve these have created new precedents and future problems, almost in the manner of case law. Three recent examples illustrate this issue. The first is the case of sildenafil (Viagra). Initially, the secretary of state for health advised general practitioners not to prescribe sildenafil.2 However, the manufacturer challenged this in court3 and the drug was then listed under schedule 11—that is, as a drug funded by the NHS for defined conditions only.

Work of NICE

The second illustration is the work of the National Institute for Clinical Excellence (NICE). Its first recommendation was that zanamivir (Relenza) should not be prescribed within the NHS.4 This advice was accepted by the secretary of state, although he has not formally blacklisted the drug. However, the pharmaceutical industry responded with outrage. It described the United Kingdom as an environment inimical to an innovative industry and claimed that practices such as this undermined the continued existence of the pharmaceutical industry in the United Kingdom. Similar controversy surrounds NICE's recommendation on interferon beta. However, a different problem arises with its advice on how to use taxanes in ovarian cancer; in this case health authorities may not be able to fund the treatment.

Market instability

The third example of problems arising from the lack of a coherent policy is the recent upheaval in the market for generic drugs.5 Up to now it has been government policy to have an unregulated market for generic drugs. However, the steep increases in the price of some generic medicines attendant on this lack of regulation has the potential to undermine the budgets and therefore the development of primary care groups and trusts, an important part of other government policies to modernise the health service.

Basis of a policy

We need a clear policy that defines national priorities based on a balance between meeting patients' needs and ensuring effective use of NHS resources in prescribing and affordability while supporting an important innovative industry. Such a policy would provide a transparent framework within which stakeholders could understand their roles and responsibilities, and it might have avoided the conflicts described above. A clear policy could be assessed from time to time and revised as appropriate.6


Embedded Image

(Credit: JOHN PAUL ENDRESS/THE STOCK MARKET)

Stakeholders

In the United Kingdom the key stakeholders in pharmaceuticals are:

  • Government and its agencies (Department of Health, Department of Trade and Industry, NICE)

  • “Citizens,” as patients and as taxpayers

  • Healthcare professionals

  • Pharmaceutical industry

  • Commissioners of health care (health authorities and primary care groups or trusts)

  • Regulators (Medicines Control Agency, European Medicines Evaluation Agency).

Conflicts and common objectives

Some of the objectives of each stakeholder are common to all, but others conflict. All stakeholders want safe and effective drugs manufactured to a high quality. All want drugs that will improve health, both now and in the future. However, the UK government is both the regulator and supporter of the pharmaceutical industry, restraining its profits and ensuring that drugs are reasonably priced for the NHS, while promoting a research based manufacturing industry.7

Citizens want equity and ease of access to effective and safe drugs. As taxpayers, they are keen to control the cost of healthcare provision. However, as patients they may demand access to new or expensive drugs, and this could prove an inefficient use of NHS resources. Healthcare professionals want to use safe and effective drugs, but they may wish to preserve professional privilege and power and may resent constraints on their prescribing.

The pharmaceutical industry wants a good return for investors, and it can achieve this by helping the other stakeholders achieve their major goals. Those who commission care in the NHS require that drugs and their use should be as cost effective as possible in order to squeeze the maximum benefit out of their inadequate budgets. Regulators of medicines have a clear agenda to ensure that drugs are efficacious and safe. However, the existing legal framework for licensing could be criticised, firstly, for adhering to a limited definition of efficacy rather than a more rigorous comparison of the effectiveness of new medicines and, secondly, for a lack of transparency in relation to its decisions.

Managing prescribing costs

The common ground is easily agreed, but a national policy is needed to deal with the conflicts. The management of prescribing costs in the United Kingdom provides a good example of conflict. Locally held budgets have resulted in “postcode prescribing”—in inequity in the availability of medicines.8 In addition, by emphasising the costs rather than value of prescribing, locally held budgets may have limited inappropriately the benefits to patients and undermined attempts to improve the quality of prescribing. Nevertheless, unrestrained spending on drugs has opportunity costs elsewhere in the NHS and limits other services to patients in an unplanned and irrational way.

The pharmaceutical industry aims to provide effective drugs; but it needs to do this in a manner that allows it to meet its primary aim of profitability in a competitive environment. It may therefore fuel demand for its products and undermine attempts to improve the quality of prescribing by its promotional activities. The government is torn between containing costs, improving health, supporting industry, keeping within the law, and being seen to act in a manner that will not lose it too many votes.9

Current policies

Current policies include local budgetary responsibility through primary care groups and trusts, with encouragement and incentives to general practitioners to prescribe the cheapest drug consistent with the desired clinical effect. Nationally, the recently revised pharmaceutical price regulation scheme incorporates some controls on profitability in proportion to manufacturers' sales to the NHS and their capital investment in the United Kingdom.10 This scheme, by preserving the industry's profitability, may seem at odds with existing local attempts to control prescribing costs.

A new element is NICE, whose remit is to advise on the cost effective use of NHS resources on new technologies, particularly medicines; to develop clinical guidelines; and to establish a framework for clinical governance.11 The work of NICE should improve the use of drugs, but it may conflict with commercial interests. For example, an opinion from NICE that a new drug is not cost effective might undermine the manufacturer's development plans and profitability and policies supporting the industry as a whole. Fear of this and the uncertainty in what had up to now been a stable relationship between industry, government, and the NHS prompted what many see as an overreaction by the industry to the institute's decision on zanamivir.12

Local concerns

Local commissioners in the NHS have broadly welcomed the institute, but they are concerned that its current and future advice—for example, to provide taxanes for defined groups of patients—might divert funding away from local priorities. Their objectives of tailoring services to the needs of local populations are difficult to achieve when resources are pre-empted by national priorities.

Experience elsewhere

Australia has just republished its national medicines policy, in which it defines four key objectives:

Key elements of a national pharmaceutical policy

View this table:
  • Timely access to the medicines that Australians need at a cost individuals and the community can afford

  • Medicines that meet appropriate standards of quality, safety, and efficacy

  • Quality use of medicines

  • Maintaining a responsible and viable medicines industry.13

The need to balance health needs and affordability while ensuring value for money for the community as a whole is explicit. The need for an indigenous pharmaceutical industry is emphasised, partly to promote access and also for export purposes, but there is no commitment to pay a premium for innovation rather than manufacturing, and the pharmaceutical industry in Australia is far less important than that in the United Kingdom. Although the need for partnerships between the various stakeholders is emphasised, the potential for conflict is recognised— for instance, in the possible trade-offs between ease of access and quality use of medicines, or between quality use (where under utilisation is identified) and cost containment.

The World Health Organization also has a draft strategy for essential drugs and medicines which supports access, quality, efficacy, safety, and rational use of essential drugs.14 But it makes little mention of the need for a pharmaceutical industry to supply them or to develop the next generation of essential drugs.

Elements of a national policy

An integrated pharmaceutical policy would go beyond the regulation of drugs, of the industry, and of prescribers, but it would combine all of these. Its fundamental aim would be to achieve what is ultimately best for patients and the health service—effective and safe drugs that are readily accessible at an affordable price—and it would support continuing research into areas of unmet need. The elements which we suggest should be included in an integrated, national, pharmaceutical policy are set out in the table (p 1525). Each element should be complementary to all other elements, or at least neutral.

Probable conflicts

There are two probable areas of major conflict. The first concerns access to treatment and responsiveness to need. For example, should the NHS provide all licensed drugs to any patient (the former default position overturned by the Relenza decision15), or should affordability and ensuring value for money be the criteria for provision? NICE is increasingly addressing these questions.

The second area of conflict concerns affordability and value for money in relation to providing a favourable and stable environment for the pharmaceutical industry. This area is currently covered by a separate government policy, the pharmaceutical pricing regulatory scheme. Under the regulatory scheme, each company and the Department of Health agree the level of profits permitted from NHS sales, based on a company's investment in the United Kingdom. While the scheme has undoubtedly provided the stability the industry requires, it is not clear whether it has ensured a good deal for the NHS as a whole.16 The scheme has recently been renegotiated, but, surprisingly, the terms made public so far do not mention NICE and its probable effects on a company's profitability.10 Collier argues that a drug company's profitability is ensured through the pharmaceutical pricing regulatory scheme, even if NICE rules against its product.15 However, if this is correct it cannot be sustainable. It seems that these two elements are therefore in conflict, as exemplified by manufacturers' appeals against NICE's decisions.17

Funding NICE recommendations

The relative priorities for the aims and possible trade-offs between such opposing areas need further debate, but we believe that issues here should be explicit. However, the national policy must go beyond the negotiation of existing schemes, as essential elements would still be missing from this. For instance, the lack of central funding to implement NICE's recommendations on taxanes means that we still do not have a coherent national policy on using this drug.

Central funding

The recent report from the Royal College of Physicians suggests that any nationally recommended therapy should be funded centrally rather than locally, avoiding geographical variation in availability without removing local discretion in other areas.18 Such an approach would have other advantages; it would facilitate audit of the benefits, adverse effects, and costs associated with new drugs in clinical practice, ensuring, in effect, the controlled release of a drug.19 It could also be used to encourage support for further research into treatments in areas of unmet need by promising a reasonable market in advance. A trade-off for this type of support might be to consider either reference pricing (that is, setting a price for a drug within a class for which the NHS will pay, as is now partly happening with generic drugs) or generic substitution by pharmacies, reducing costs elsewhere in the drugs bill. These are possibilities that could be developed within an integrated policy.

Appeals mechanism

In the past, weak guidance on decisions not to provide therapies has led to legal challenges. Objections have come from companies pointing to European and British laws on market power and pricing transparency or from patients who claim lack of due process in local decision making. 2 17 20 Challenges such as these undermine confidence in any system and a legally robust, integrated policy should avoid this. However, the policy would still have to incorporate an appeals mechanism for patients, clinicians, and companies against decisions made nationally or locally.

Minister's role

At the heart of any government policy is the minister, making decisions and providing accountability to elected representatives. The minister will need to weigh the advice from NICE, the results of an impact analysis of the effects of each option (including the impact on the pharmaceutical industry and on the UK research base), and ethical and political issues. Cabinet colleagues such as the secretary of state for trade and industry will also influence the minister, and this influence, like the decision, should be transparent and justified.

Conclusions

The pharmaceutical arena is now far too complex to be enveloped in the current balkanised approach to policy. The basis for an integrated national pharmaceutical policy now exists, and there is an ideal opportunity for government to develop and implement it. The alternative—muddling through—is no longer acceptable.

Footnotes

  • Competing interests None declared.

References

  1. 1.
  2. 2.
  3. 3.
  4. 4.
  5. 5.
  6. 6.
  7. 7.
  8. 8.
  9. 9.
  10. 10.
  11. 11.
  12. 12.
  13. 13.
  14. 14.
  15. 15.
  16. 16.
  17. 17.
  18. 18.
  19. 19.
  20. 20.
View Abstract