Value based pricing – is there any other way?
Claxton et al demonstrate the need to be clear about the importance
of value based decisions in the NHS (1). At the sharp end of NHS
commissioning there feels to be no other way to make decisions as the
arrival of new technologies continues to outstrip the budgets that are
If Claxton et als' paper lacks anything it is a discussion of the
political pressures in skewing agreement about values. These pressures
can cut across the processes of Primary Care Trusts (PCTs) when they are
trying to make some of the more difficult decisions around value based
priorities. We have seen how the guerrilla media tactics around
Herceptin wound up the public and the politicians (2)(3). When this was
combined with aggressive marketing then many PCTs caved in and agreed to
fund Herceptin without waiting for NICE’s assessment on its value.
Even the National Institute for Health and Clinical Excellence (NICE)
is subject to some political constraints. In the case of the highly
priced orphan disease drugs NICE does not have these on its schedule
whilst the Scottish Medicines Consortium will carry out assessments and
can find them to be of poor value, for example, “No information is
presented in the submission to support the therapy being cost effective.”
Pharmaceutical companies increasingly appear to price orphan drugs at
what the market will bear although any drug costing around £250,000 per
patient per year is likely to look very poor value even if it might
demonstrate good outcomes in the future. This means that companies have
to target the Department of Health (DH) whilst the DH also has to try and
achieve good deals for the NHS at the same time. The DH and a leading
pharmaceutical company involved in developing orphan drugs recently agreed
a £7 million partnership (5). This agreement raises questions about what
compromises might have been made on behalf of the NHS to overcome the
perception of poor value with these drugs.
If we want the optimum value from treatments and the maximum benefits
for patients is there really any other way but being serious and
signalling real intent about value based pricing ?
(1) Claxton K, Briggs A, Buxton MJ, Culyer AJ, McCabe C, Walker S,
Sculpher MJ. Valued based pricing for NHS drugs – an opportunity not to be
missed? BMJ 2008;336:251-254 (2 February).
(2) BBC webpage. Woman gets cancer drug in U-turn.
http://news.bbc.co.uk/1/hi/england/staffordshire/4421570.stm 9 Nov 2005.
(3) Boseley S. The selling of a wonder drug. The Guardian March 29 2006.
(4)Laronidase (Aldurazyme) resubmission. The Scottish Medicines
Consortium issues advice on laronidase (Aldurazyme®) for
(5) Department of Health website. Genzyme and NHS Commissioning Group form
a £7 million partnership to support world class commissioning for rare
diseases. 5 Nov 2007.
JH is a member of the National Commissioning Group
Competing interests: No competing interests