UK details plans for value-based pricing of branded drugs

UK Health Secretary Andrew Lansley provided further details Thursday of previously outlined plans to replace the current Pharmaceutical Price Regulation Scheme with value-based pricing for new branded drugs on the NHS from the end of 2013. "Value-based pricing will ensure that the prices the NHS pays for medicines are based on an assessment of value, looking at the benefits for the patient, unmet need, therapeutic innovation and benefit to society as a whole," he said.

The Department of Health noted that "while the current system of pricing medicines has tried to achieve a balance between reasonable prices for both the NHS and the pharmaceutical industry, it does not sufficiently promote patient access or innovation effectively." The new scheme is designed so that "more licensed and effective drugs will be available to NHS patients and clinicians at a price that reflects the value they bring," the department added.

Under value-based pricing, the government would apply weightings to the benefits provided by new drugs, with these translating into a range of price thresholds reflecting a maximum acceptable price. Lansley explained that under the system, the speed of assessment of a product, as well as agreement on prices would be important. As a result, companies would be able to make drugs available at a "contingent" price, which could be revised at a later date if further evidence of effectiveness emerged. The proposals are now open to comments for 13 weeks.

Lansley also indicated that as previously detailed, under the new system, the National Institute for Health and Clinical Excellence would have "an important advisory role," which would include "assessing the clinical benefits of new medicines and giving authoritative evidenced-based advice."

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