When it comes to medicines NHS England has been expanding their influence. Whilst the agency is still relatively new – being only six years old compared to the National Institute for Health and Care Excellence (NICE)’s impressive twenty years – NHS England has arguably been punching above their weight when it comes to the use – or not – of medicines.
In primary care, NHS England has played a role in setting out which items should not be routinely prescribedin primary care and hence no longer to be paid for by the Clinical Commissioning Groups (CCGs), responsible for commissioning primary care. That’s a bold move; it’s hard to get people to give up what they already have.
To support secondary care, NHS England has taken on responsibilities previously included within the Department of Health and Social Care (DHSC, formally known just as the Department of Health, or DH). This includes the Commercial Medicines Unit (CMU) that runs tenders for medicines. CMU is made up of teamsthat cover both generics but also branded medicines too, including treatments for multiple sclerosis and insulin analogues for example. Tenders are run on different time horizons covering different regions across England.
NHS England also took on responsibilities relating to the use of Patient Access Schemes (PAS). These are schemes which allow companies to secure a positive NICE appraisal, typically through a confidential discounted price, although not always – sometimes agreements have included an outcome element too. PAS have been important to companies; the steady risein their number illustrates a revealed preference to use them rather than face a NICE ‘no’.
Companies used to have to share their initial proposals for a PAS with the DH; since 1 January 2018 companies have had to submit PAS proposals to NHS England. This is important not just because it signals the gatekeeper role NHS England has in assessing what could work from an operational point of view in the NHS, but also because it’s NHS England who will be building up the insight on the options that companies would like to explore. Previously the DH would have this. It’s subtle but it plays into how NHS England is, over time, capturing more knowledge and building its experience with industry.
NHS England has describedtheir commercial functions with respect to medicines not only covering CMU, but also in supporting Trust and Specialised Commissioning Pharmacists, supporting the National Specialised Clinical Team and Clinical Reference Groups (CRGs), and the Cancer Drugs Fund (CDF) team. All of these play a role in making decisions about whether new medicines can be incorporated into the NHS, including at what pace and scale, be that as part of specialised services (where CRGs play a role) or within the special funding, the CDF, for cancer drugs that are promising but not yet proven to be cost-effective.
As a signal of the importance that NHS England place on getting the right commercial deals for medicines, by November 2017NHS England had set out their ambition for 40 Whole Time Equivalents (WTEs) to support tender frameworks, and a further 12 WTEs for the negotiated solutions team. One of the new recruits appointed in late 2018 includes Blake Dark, who is now heading up the commercial medicines division at NHS England. Dark has worked in the pharmaceutical industry for over 20 years.
David Taylor, an expert in pharmaceutical policy has pointed outhow NHS England is able to act as a single, monopsonistic, national purchaser of medicines and questions how far NHS England is acting to protect overall community aims. In this case, a viable pharmaceutical sector as well as an affordable NHS.
Of course, NHS England need to make decisions that affect access to medicines in the context of NICE guidance; in some ways a positively appraised technology ties their hands with a legal requirement to fund.
However, that hasn’t meant that NHS England has been on the backfoot; quite the contrary. In hepatitis C for example, NHS England not only achieved a delay in the implementation of positive NICE guidance for Sofosbuvir (Sovaldi), but in 2018 was also negotiatinga strategic national agreement for hepatitis C treatments. Presumably this is to leverage competition in the class. Marring NHS England’s reputation was a court challenge by AbbVie on the process, albeit AbbVie lostthat challenge.
NHS England was also a key orchestrator of the introduction of the Budget Impact Test (BIT) introducedfrom 1 April 2017. Essentially even if a medicine is cost-effective, if it costs more than £20 million in any of the first three years of launch, there is a commercial negotiation with NHS England.
NICE was formally given responsibility for the CDFfrom July 2016, something that was previously run by NHS England. So sometimes NHS England has had to hand back the reigns. Yet even here many drugs that get on the CDF have to have a managed access agreement (MAA) in place; it’s these deals that the NHS England commercial team are actively working on and have secured in the past.
In a team effort, NHS England sit alongside NICE colleagues as part of early dialogue services that individual companies can pay for. Early dialogues cover a host of issues, including planning for uptake. NICE also undertakes commissioning support work for NHS England to support their decisions on specialised drugs; just some of these drugs includechenodeoxycholic acid and cholic acid for treating inborn errors in primary bile acid synthesis, telotristat for carcinoid syndrome and bictegravir-emtricitabine-tenoforvir alafenamide for treating HIV.
Unlike previous voluntary agreements covering pricing and reimbursement of branded medicines for the NHS (formally called the Pharmaceutical Price Regulation Scheme (PPRS) with each iteration of the Scheme covering a five-year term), NHS England was part of the negotiation of the Voluntary Scheme for Pricing and Access to Branded Medicines (or VPAS for short). That NHS England were part of the agreementsignals the growing influence of NHS England on medicines pricing. Staffat the ABPI have been at pains to point out that NHS England was a party to the negotiations and is ‘tied’ in.
VPAS has also, to a degree, sought to rebalance some of the influence between NHS England and NICE. Under VPAS, all new medicines will be appraised by NICE, or rather will be by April 2020. Industry will be paying for this expansion in NICE appraisal capacity.
More importantly, it will also mean that companies that wouldn’t have had their new drugs appraised by NICE under the old regime will be able to now. That avoids slipping into the gap that was left when NICE didn’t appraise a drug and also navigating an uncertain path with NHS England’s Clinical Priorities Advisory Group (CPAG) or other regional groups looking at new medicines.
The incentives for companies are clear; get a NICE approval by coming in within the standard cost-effectiveness range of between £20,000 to £30,000 cost per Quality Adjusted Life Year (QALY) and stay within the affordability target. That will allow companies to avoid needing to negotiate with NHS England which could add months to achieving access. Or they could get a NICE approval and offer an even better deal to get NHS England’s help on uptake.
Getting access for new medicines quickly will not only benefit patients but add to the company’s bottom line. An exemption on making payments to the DHSC – the flipside to promises on access in VPAS – for the first three years, will allow companies to keep more of the money they make on them. Of course, ever deeper discounts with perhaps questionable promises on uptake may not be commercially palatable. NHS England needs to prove it can deliver to get the best deals from companies in the future.
VPAS features in the Long-Term Plan(the latest in a long line of such vision setting and ambitious plans for the NHS). Within the Long-Term Plan, the stated intention for medicines is for faster adoption of cutting-edge and best value drugs. So at least NHS England has signalled that it has taken VPAS seriously. That said, VPAS formally started on the 1 January 2019, and the Long-Term Plan was published on 7 January 2019, so it’s easy enough to pop a cross reference or two in whilst still fresh in the minds of NHS England. Harder is to maintain sufficient focus over the next five years that VPAS covers.
What’s missing as of April 2019 is the detail of a promised Commercial Framework. VPAShas set the commitment that there will be evolution in commercial arrangements, offering increased flexibility but only for the best value propositions. Presumably the Commercial Framework will set out more on just what these flexibilities are. The Commercial Framework will also cover PAS. The Commercial Framework will be open to more than just members of the VPAS, although the vast majority of companies belong to VPAS.
NHS England will be holding the pen, but industry and NICE are part ofthe development work. Let’s hope the DHSC are still providing input too; they’ve had to step in for when agreements have been hard to strike, as the long-running negotiations over Vertex’s Orkambi (lumacaftor/ivacaftor) for cystic fibrosis illustrates.
Despite almost three yearsof appraisal and negotiation activity, no agreement has been made. VPAS says that there will be detail on ‘escalation’, presumably setting out just when NHS England will want to flag to DHSC and Ministers a challenging negotiation. It’s always the bad experience people remember; for balance, it’s important to note that success has come for NHS England and companies with deals agreed for CAR-T therapies Yescarta (axicabtagne ciloleucel; Gilead) and Kymriah (tisagenlecleucel; Novartis).
The ABPI has been setting out its wish list for what the Commercial Framework should cover; how the processes will work and how the whole commercial environment will be made coherent.
That sounds less like a framework and more like a flow chart. That could be a good idea; even just agreeing what are the most important issues are that need to be dealt with could help direct negotiations down the best path; it’s not always price that is the problem, sometimes it’s uncertainty.
That said, a lower price is bound to help NHS England feel better about higher uncertainty so price will likely always feature in negotiations. That’s signalled too in the (none too subtle) goals for any flexible commercial approach set out in VPAS, to:
Whilst there is engagement with others from NHS England on the Commercial Framework, it’s likely to be heavily shaped by what NHS England is already doing. For example, NHS England is already talking with companies like Biogen, to explore commercial flexibilities for Sprinraza (nusinersen), used to treat the rare condition spinal muscular atrophy (SMA).
Such examples though illustrate that it can take time for such discussions – plus the NICE appraisal in parallel – to take. Draft NICE guidance not to recommend Spinraza was issued in August 2018, promptingNHS England and Biogen to begin their discussions. At the time of writing, the results of a resubmission by Biogen to NICE and discussed at a NICE committee meeting on 6 March 2019 aren’t yet published.
NHS England’s chief executive Simon Stevens has previously mentioneda host of contracting options ranging from outcomes-based, annuity-based to volume-based pricing deals. The Commercial Framework would do well to formalise if these are ever on the negotiating table, and if so, under what circumstances. Plus there’s the small matter of who gets to veto what options; will companies get to put forward their own ideas, or will NHS England define a shortlist of what they are willing to consider and rule out any other ideas?
Underpinning NHS England thinking could well be that less is more for an untested Commercial Framework; principles could help guide the approach to commercial negotiations but it’s hard to be too specific when there are idiosyncrasies for every patient group and every drug. Plus NHS England will want to avoid needing to re-write the commercial framework and may well be thinking of how to set up a framework that can work for the me-too branded medicines through to the cutting edge of potentially curative cell and gene therapies coming to market.
NHS England are building up their reputation for being commercially savvy. There is an opportunity for NHS England to consolidate that view by developing a Commercial Framework that is reasonable and balances the tensions between speed, price and uptake which collectively influence whether a new medicine is affordable for the NHS.
The Commercial Framework must be coming soon too; NHS England’s board were briefing in November 2018 that work would ‘shortly’ be starting on the Framework. Add to that Steve Brine, parliamentary under-secretary for health and social care (at the time) told Parliament in December 2018 that the intention was for the Commercial Framework to be published early in 2019 (but government’s early could be everyone else’s late).
The test will be whether using the Commercial Framework really does deliver fast and reasonable deals that companies will sign up to. A Commercial Framework that fails to see NHS England and companies strike deals will put at risk many of the promises on access, to the detriment of patients and perhaps to the detriment too of industry sentiment about the UK. That’s something that perhaps government can ill afford in a post EU referendum world.
Leela Barham is an independent health economist and policy expert who has worked with all stakeholders across the health care system, both in the UK and internationally, working on the economics of the pharmaceutical industry. Leela worked as an advisor to the Department of Health and Social Care on the 2019 Voluntary Scheme for Branded Medicines Pricing and Access (VPAS).