by Richard Staines
AMSTERDAM, Nov 11 (APM) - Any value-based assessment for pricing drugs in the UK will need major changes from NICE's previous proposed model so as not to overvalue newer therapies at the expense of older proven treatments, a conference heard on Tuesday.
NICE's previously proposed route to better rewarding pharma companies for drugs that offered greater societal benefits would have failed because it applied a different value-for-money analysis to the medicines displaced by novel treatments compared with the new treatments themselves, delegates at the International Society for Pharmacoeconomics and Research (ISPOR) conference heard.
The UK's latest attempt to move to a 'value-based' system of drug pricing came to a halt earlier in the year as NICE accepted it did not have a way forward with such a system, citing disparity of views from interested parties, cost concerns and lack of political will. (APMMA 36150)
However, the approach has not been ruled out and speaking at the ISPOR event in Amsterdam, Dr James O'Mahony, of the Department of Health Policy and Management at Trinity College, Dublin, argued NICE would need to make significant changes if it tried again.
Fatally, in its earlier thinking the institute failed to apply the same value for money analysis on the medicines displaced by novel treatments, skewing the system from the start, said O'Mahony.
This was the rationale for a lower quality-adjusted life year (QALY) maximum of around 13,000 pounds (16,000 euros) proposed by some academics. NICE's existing generally-applied maximum is of 20,000-30,000 pounds (26,000-38,000 euros), he noted.
O'Mahony noted that under NICE’s value based assessment proposals, the absolute QALY loss - the QALY loss due to the condition with current treatment compared with maximum QALYs without the condition - was taken as a measure of the societal impact of the disease.
The politically sensitive issue of favouring the young - or being seen not to care for the old - was raised ahead of NICE shelving value-based assessments.
O'Mahony said: “We are fully aware that there are problems with age discrimination in the criteria. But my main concern is asymmetrical application of these criteria.
“Opportunity cost (what is lost when A is paid for over B) is the big problem even if you reconcile problems of age discrimination,” he said.
Rebecca Beale, analyst at Costello Medical Consulting, said a value-based assessment would create very different decisions than NICE’s existing system and drugs now signed off for National Health Service funding would be rejected and vice versa.
She said that, based on an analysis using assumptions about how the proposed value-based assessment would work, there would be a "significant change" in outcomes.
A clear relationship between ICERs above the 20-30,000 pounds (26,000-38,000 euros) limit and rejection would no longer apply under the proposed the regime, due to influence of factors such as "burden of illness" calculations, she said from the podium.
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