NICE agrees £20m cap on new drugs

The National Institute for Health and Care Excellence has agreed a new £20m-a-year cap on the cost of new drugs, in an attempt to save money amid mounting pressure on NHS funds.

The plans, due to be set in motion in April, have prompted objections from patient groups and the drug industry warning that a breakthrough in fields such as dementia could end up being delayed years before the treatment reaches patients.

Currently, drugs that are assessed as cost-effective by NICE are automatically recommended for use in the NHS. However, the new plans means there could be delays of up to three years before new drugs are made available to give NHS bosses the chance to try to renegotiate the price with drug firms.

The measures will assess exactly how many people might take the drug and the total cost to the NHS, rather than simply the cost versus benefit of the drug on the basis of the impact to an individual. NHS England will therefore be able to halt the 90-day price negotiating deadline and begin more extensive talks to persuade drug manufacturers to lower the price.

Sir Andrew Dillon, NICE chief executive, said: “We’ve listened carefully to what stakeholders have been telling us throughout this consultation and made some important changes, as well as adding detail to our proposals. Significantly, we have today announced that we will look at the feasibility of extending the fast-track appraisal process to a wider group of treatments.

“We are taking forward the proposal for more flexibility in the adoption of technologies into the NHS which are cost effective but which have a predicted budget impact of £20 million or more during the first three years. Companies will have the opportunity of confidential negotiations with NHS England, to help avoid and minimise delays in patients having access to treatments recommended by NICE. We have agreed that we will review this in three years to see what impact it is having on allowing access to new drugs. 

“We believe these and the other changes that have now been approved will enhance our ability to optimise access to innovative treatments in the light of the significant financial challenge facing the NHS.”

NHS England’s acting director for Specialised Commissioning, John Stewart, said: “As well as significantly speeding up access for patients for the most cost effective new technologies, NICE’s new approach also shows that the NHS is prepared to pay far more for highly specialised treatments that can transform patients’ quality of life.

"We listened carefully to the feedback received during the consultation and have adjusted our proposals by trebling, for the most transformative treatments, the threshold for  determining routine funding - raising the upper limit to ten times that used for standard treatments.

“These are not easy decisions, but we are committed to working closely with companies that are willing to price their products responsibly and this new flexibility will help us develop innovative win/win/win agreements – good for patients, good for taxpayers and good for those companies that are willing to price responsibly."