ABPI challenges new NICE and NHS England medicine pricing rules in the UK

The Association of the British Pharmaceutical Industry (ABPI) has confirmed that it is challenging new rules put in place from 1 April 2017 in the UK by the National Institute for Health and Care Excellence (NICE) and NHS England, by way of an application for judicial review of the rules by the UK High Court.  ABPI argue that two rules in particular could have a significant impact on patient access to new and innovative medicines.

The first is a £20 million “Budget Impact Test (BIT)”, which will apply to medicines that have been deemed cost-effective by NICE but are forecast to cost the NHS more than £20m a year in any of their first three years of use following NICE-approval.  Under the new regime, any medicine that passes the £20m threshold will have to undergo a separate negotiation process with NHS England before it will be made available to the public.  Manufacturers may therefore, in essence, face a second level of price-discounting, as many are required to offer “patient access scheme” discounts in order to pass NICE’s initial cost-effectiveness threshold.  In circumstances where the commercial agreement between the parties still exceeds the £20m BIT threshold, NHS England will discuss potential variations to the medicine’s funding requirements with NICE.  During any such discussions, NHS England will be expected to provide NICE with information including: the relevant provisions of the commercial agreement, the duration and justification for the proposed variation and an assessment of the impact on patients eligible for treatment under the guidance but whose treatment will be delayed because of the funding variation.

The old rules allowed patients access to a drug within 90 days of a NICE approval but the BIT means NHS England will have up to three years to negotiate with pharmaceutical companies over price. By NICE’s own calculations, around one in five new drugs will be affected.  At present, the impact of the BIT is to be reviewed by NICE and NHS England in 2020.

The new rules also hit drugs for very rare diseases. Under these rules, which ABPI is also challenging, treatments for very rare conditions up to £100,000 per quality life adjusted years (QALY) will be automatically funded from routine commissioning budgets.  However, there is a concern that access to some current treatments of rare diseases (a number of which cost more than £500,000 per QALY) will be interrupted under the new rules.

A decision on the application from the High Court is expected within the next few months.

This post was originally co-authored by Steven Baldwin.