"The NHS will last as long as there are folk left with the faith to fight for it"
Aneurin Bevan

Tuesday, 12 January 2010

Conservative Draft Manifesto 2010: Dissection Part 9

An analysis of the Conservative Draft Manifesto 2010.

"We will reform the way drug companies are paid for NHS medicines so that any cost-effective treatment can be made available through the NHS with drug providers paid according to the value of their new treatments"

This is a huge new policy. Let's examine in detail what it means. First, "any cost-effective treatment" what does this mean? Currently NICE determine which drugs are cost-effective according to the outcome of the treatment (in terms of extra life the drugs provide, and the quality of life). The Draft Manifesto calls NICE "unaccountable bureaucrats" which is an emotive and unfair term given to medical experts who carefully evaluate efficacy of treatments. The phrase is used to tap into the public unrest over the finality of NICE decisions: if NICE say that a drug is too expensive and ineffective then the NHS will not pay for the drug. The Conservatives suggest that they will allow the Health Secretary to overturn such decisions, not based on science, but based on politics. At this point I have to remind you of another pledge in the manifesto that says the Conservatives aim to have "less political interference in the NHS". They are clearly being inconsistent here.

It seems very odd that during the time between writing the 2009 health policy and the Draft Manifesto (about a year) the Conservatives have changed their opinion of NICE. In the 2009 policy document they say "The NHS Board will also be responsible for publishing guidelines for NHS commissioners, based on advice from NICE which will set evidence-based standards of care…", "NICE should provide commissioning guidelines for urgent care, providing evidence-based criteria for patient access and a basis for local contracts" and when it comes to determining the cost of treatment "NICE should be involved in this process, working with drug companies to set fair prices for new medicines". In other words, in the 2009 policy document the Conservatives treat NICE as a experienced, professional organisation central to their policies. But in the 2010 Draft Manifesto the Conservatives call them "unaccountable bureaucrats", not a way to make friends, and certainly not a way to build a good working relationship.

Then there is that interesting phrase "drug providers paid according to the value of their new treatments". What does that mean? Well, the 2009 policy document explains this in more detail; it says that their policy will "allow the NHS to only pay according to the benefits the drug brings to patients". This is an innovative idea: the NHS will dictate to drug companies the price of their products! Do you think it will work? If your answer is no, then I agree with you. This is a type of command economy that failed miserably in the Soviet Union, but seems to be popular with Cameron's Conservatives. The answer to the spiralling cost of drugs is competition so it is interesting that Cameron is rejecting the free market in this area.

The 2009 policy document uses the ludicrous fiasco over Lucentis as an example of how this value-based pricing "works". They say:

"For example, the drug company Novartis recently agreed to provide Lucentis, a sight-saving drug which did not yet have proven long-term cost effectiveness, on the NHS by having the NHS pay for the first 14 injections of the drug, and if the patient needed any more after that, Novartis would pay"

This statement hides a lot of important information, so let's review the story behind Lucentis. The drug research company Genentech developed a bowel cancer drug called Avastin (bevacizumab). This drug is given intravenously and one phial of Avastin costs around £300. It was discovered that people who were given Avastin and had Wet Macular Degeneration (Wet AMD, a form of progressive blindness) found that the degeneration of their sight halted. Tests showed that a tiny amount of Avastin injected in the eye stopped the degeneration. Hitherto Wet AMD was untreatable, but now there was a cheap, easily applied treatment. One phial of Avastin is enough for 300 treatments (so that is £1 per treatment). Avastin is not a cheap drug when it comes to treating bowel cancer, but because of the quantities involved, it is a cheap drug when it comes to treating Wet AMD.

In response to this threat to their profits Genentech took Avastin and modified it to remove the cancer treating active component to produce Lucentis (ranibizumab). Tests have shown that there is no extra benefit from Lucentis, and that it is no safer than Avastin. Novartis (who licences Lucentis from Genentech) charges £1000 per treatment for Lucentis. That's a thousand times more than the same treatment with Avastin. The CEO of Novartis is on record saying that the cost of Lucentis does not reflect production costs or development costs, but is merely calculated as to how much people will pay to keep their sight. This is totally against the principles of the NHS and no politician should support this behaviour from Novartis. Sadly, David Cameron, through his value-based pricing policy is supporting and encouraging this behaviour.

NICE negotiated a partial deal with Novartis where the NHS pays for the first 14 injections (£14,000) of Lucentis and Novartis would pay for the rest of the treatments for that patient. Different patients need a different number of injections, but the general opinion is that patients rarely need more than ten injections. In other words, the "deal" negotiated by NICE simply pays Novartis whatever they want. Why didn't nice negotiate that the NHS paid for fewer treatments? No idea. Why hasn't David Cameron or his health team noticed that the NHS has been ripped off in this deal? David Cameron is a clever guy, so my only guess is that he supports haemorrhaging NHS cash towards the private sector.

Why, you ask, doesn't the NHS use Avastin? This is where the story gets even more cynical and your opinion of big pharma will plummet more. The reason is that it Avastin not licensed in the UK for treating Wet AMD and NICE cannot recommend that the NHS pays for a non-licensed drug. Why isn't Avastin licensed? Because Genentech will not put it forward for licensing. NHS clinics do use Avastin to treat Wet AMD (in the US this is called "off label"), but they have to find the funds to pay for it (at £1 per treatment that is not a problem). I have been told by an eye specialist that his clinic gives patients the option of being treated with Avastin or Lucentis, and about half choose Lucentis.

Furthermore, Genentech is not a company that the government should be using as a shining example. They use disgraceful sales techniques in the US which will have the effect of Medicare (the US government healthcare fund for pensioners) being unable to fund treatment for Wet AMD. Have a read of some of the blog posts of Irv Arons to get a taste of what this company does. For example, eye specialists in the US obtained Avastin from compounding pharmacies, companies who safely divide up a phial of Avastin into the doses need for Wet AMD treatment. However, to protect the sales of the far more expensive (but just as effective) drug, Lucentis, in 2007 Genentech announced that they would no longer supply compounding pharmacies. It is estimated that Genentech could make an addition $800 million a year if Avastin is no longer used to treat Wet AMD. Dirty tricks, indeed.

It is clear that the Lucentis fiasco shows how immoral pharmaceuticals can behave, and the Conservatives support such appalling behaviour at the cost of the NHS.

The Conservative 2009 health policy document says:

"We should encourage the NHS to use whichever medicines are clinically effective, and agree to pay the drugs companies according to the therapeutic benefit and innovative value."

That is exactly the rationale that makes the cost of Lucentis one thousand times more expensive to the NHS than Avastin!

This is the standard which a Conservative government will use to determine how companies are paid for drugs. Far from making more drugs available to all, it will actually pay drug companies more money unnecessarily. This behaviour makes David Cameron look like a spiv acting on the behalf of drug companies: a drug dealer in the very worst sense.


  1. Excellent analysis. Please keep up the good work on this blog, it is one of the best and most thoughtful I have ever come across.

  2. Hi Richard. I read your comment on my Avastin article over on Left Foot Forward. I see you covered much of this story very well before me.

    You may also be interested in my older article on 'Patient Access Schemes' (such as that for Lucentis)-- which look set to be a huge fiasco and potential political timebomb about the time of the next election.


  3. Stephen, thanks, and thanks for your LFF post too.

    The Conservative government's plans for a "cancer fund" is what the Lancet describes as "the product of political opportunism and intellectual incoherence":


    The thrust of the argument is that it will be exactly the same as we have now. NICE will decide what treatments actually do provide an improvement in quality of life. At the moment if you demand that you should get that treatment then you will appeal to your PCT. Under this government's plans you will appeal to your SHA (or when they are abolished, whatever quango Lansley will create to handle this fund). The point is that there will still be a limit to how much money is available, a clinical board will still make a decision and when the money is spent, there will be no more money available.

    Significantly, at the moment your GP is your friend because their judgement is made purely on clinical grounds. But under Lansley's plans, GPs will have to "align clinical decisions with the financial consequences". Will you feel confident going to a SHA board knowing that your only clinical advocate already makes decisions about your treatment on purely financial grounds? GPs are not happy about this, and Lansley would be wise to listen very carefully about their concerns.