A Nasty Dilemma for NICE

After a prolonged disagreement with patient groups, the NHS’s funding guidance body, NICE, has approved the £10,000-an-eye blindness treatment, Lucentis. The drug has been shown to halt the progression of wet age-related macular degeneration (AMD), the most common cause of blindness in developed countries. But as the BBC  note, in approving it, NICE may have unwittingly deprived the NHS of a much cheaper alternative.

The alternative treatment is Avastin, a drug primarily used as a treatment for bowel cancer, but which also appears to be as approximately as effective as Lucentis against AMD (though good clinical trial data is not available). Even though it’s up to 100 times cheaper than Lucentis, Avastin hasn’t been assessed as a blindness treatment by NICE: it can’t be, since it’s not licensed for that use. Why isn’t it licensed? Probably because it’s owned by the same company as Lucentis: the US biotech firm  Genentech. If the NHS is prepared to pay up for Lucentis, then Genentech has little incentive to licence Avastin as a competitor.

An obvious solution to this absurd situation would be for the government to enable NICE to make licensing decisions themselves. NICE could then licence Avastin for AMD, and would then be free to recommend its use. The problem is that Genentech might then withdraw Avastin from the market altogether, leaving both cancer victims and those with AMD without current best treatment.

This problem could potentially be solved by allowing the NHS to bargain directly with Genentech. Genentech could agree to offer Avastin as a treatment for both cancer and AMD, and in return, the NHS could perhaps offer to pay a slightly higher price for the drug: it would be worth it to avoid having to either fund Lucentis, or leave those with macular degeneration in the lurch.

This direct bargaining approach is already employed by public health systems in other countries. NICE’s New Zealand equivalent, PHARMAC, has adopted a particularly aggressive bargaining strategy, and perhaps partly as a result has been able to keep pharmaceutical spending in that country way below that of other comparable countries.

References:

N Triggle (2008) Lucentis: An NHS dilemma, BBC News, 27 August 2008, sec. Health.

J Hope (2008) Too late: After thousands of patients needlessly go blind, NICE boss says sorry for delays in sight-saving drugs, The Daily Mail, 28 August 2008.

J Raftery et al. (2007) Ranibizumab (Lucentis) versus bevacizumab (Avastin): modelling cost effectiveness, Br J Ophthalmol 91(9):1244-1246.

S Morgan et al. (2007) Influencing drug prices through formulary-based policies: Lessons from New Zealand, Healthcare Policy 3(1).

S Morgan et al. (2006) Centralized drug review processes in Australia, Canada, New Zealand, and the United Kingdom, Health Affairs 25(2):337-347.

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