EMIG chairman Leslie Galloway on the future of the pharma/NHS relationship

For years, there have been inconsistent and confused  generalisations regarding the relationship between the UK pharmaceutical industry and the NHS. We are an industry desperate to have a constructive and productive two-way relationship with our only customer and such a relationship really should be quite straightforward.

After all, we do need each other – 90 percent of all interactions between a healthcare provider (HCP) and a patient result in the prescription of a medicine. People live longer and have improved quality of life because of the medicines produced by our industry.

But we’ve heard all this before and not much appears to change. So, maybe we need to better understand the problems before we can begin to start thinking about solutions.

Indeed, do we even fully understand what it means when we refer to the ‘industry’ or the ‘NHS’?

Ethical Medicines Industry Group (EMIG) member companies range from start-ups, whose prime focus is R&D, to highly developed businesses delivering essential products to patients, while continuing to invest heavily in the fight against disease. The NHS in England has 7,500+ organisations whose needs often conflict. So, there is no one homogenous group in either camp.

There are many examples of industry people who have very strong relationships with HCPs and managers that have their basis in trust and respect that have been developed over many years.

We also need to remember that the NHS is low on money and, even if the government were to increase NHS funding, it’s unlikely to mean more money for new medicines. NHS England will be pilloried for falling short on the new models of care, bed-blocking, A&E waiting times and already there are reports of doom in the coming winter. NHS providers say that despite the release in the March 2017 Budget of £2 billion for social care, the £100 million for GP triage of A&E and the £325 million for STPs, it is ‘mission impossible’ for the NHS.

Perspective is important and while we hear so much excited talk of new integrated care models, such as the MCPs and PACs, that are vital to the future of the NHS, they relate to a relatively small part of the health service.

When ‘The Next Steps on the Five Year Forward View’ was published earlier this year, many in the industry assumed its prime focus was on new models of care. It was, but it also took the opportunity to position industry and its medicines as an opportunity cost. There would need to be a choice between medicines or patient services.

It included sentiments such as: “Likewise, there is no reason in principle why extra spending on a drug treatment should automatically have a legal override so as to displace community nursing, mental health care or hip replacements – hence the new budget flexibility in the way NICE technology appraisals operate ... and in times of modest funding growth, it’s right to challenge and tackle areas of waste or low value care, so as to free up investment head-room for the main priorities.”

Also: “NHS Improvement will be supporting hospitals to save £250 million from medicines spend in 2017/18 by publishing and tracking the uptake of a list of the top ten medicines savings opportunities.”

It went further to Point 4 in The NHS Ten Point Plan – “..the NHS drugs bill grew by over 7 percent last year, with particular growth in hospital-driven prescribing. This was considerably faster than growth in the overall NHS budget. In some cases newer medicines displace other hospital costs or older categories of treatment.” – a reference to the Pharmaceutical Price Regulation Scheme (PPRS) not working for the NHS.

The Next Steps also say that “Formulary decisions will now typically be made regionally rather than by each CCG”. There are significant implications here when combined with the Regional Medicines Optimisation Committee (RMOC) consultation response that outlines a complex committee arrangement that is informed only by horizon scanning – not every medicine is appropriate for horizon scanning. There is no engagement or appeals process for industry.

There was also reference to the £20 million budget impact threshold, effective April 2017. Even in the section ‘Harnessing Technology and Innovation’, there is no mention of medicines.

So, NHS England is intent on controlling the engagement process between the NHS and industry and compensating for the failure of the PPRS. The industry response is a disastrous Judicial Review that will solve nothing and serve only to entrench both sides.
Nevertheless, it remains to be seen how the ‘real’ NHS – the Trusts, CCGs etc – will respond. Many value relationships with industry and not just based on discounts but also on translational medical research and the development real-world data, in which the UK is now a global leader.

So what do we do? We need to recognise that no one is going to solve this problem for us.

There is a way forward and its basis lies in the renegotiation of the PPRS, due to start later this year for the 2019 Scheme.

For the uninitiated, the main purpose of the PPRS is to:

  • Provide stability and predictability to the government and the industry
  • Support the NHS by ensuring that the branded medicines bill stays within affordable limits
  • Improve access to innovative medicines commensurate with the outcomes they offer patients by ensuring that medicines approved by NICE are available widely in the NHS
  • Support the government’s growth and innovation agenda for life sciences.

It is widely accepted that the current PPRS has not delivered for government, the NHS, industry and, most importantly, for patients. The primary reason is that the rebates paid by industry (variously estimated at up to £3 billion by the end of the current scheme) are not reaching the prescribing budget holders

In Scotland and Wales, there are New Medicine Funds, supported by the share of the PPRS rebates that each devolved nation receives.

In the negotiations for the 2019 PPRS, which are likely to commence in late 2017, EMIG is, among other things, proposing the setting up of a New Medicines Fund, supported by continued industry rebates, that would pay for all new medicines launched during the period of the Scheme, properly fund medicines approved under the Early Access to Medicines Scheme (EAMS) and possibly those recommended by the four new Regional Medicines Optimisation Committees (RMOCs).

The New Medicines Fund would be a hypothecated fund, separate from other NHS budgets, and all funding would be transparent as well as having an effective appeals process. Such a Fund would obviate the need for NHS England to operate an Affordability policy or a QALY threshold for Highly Specialised Technologies (HSTs) – if industry is funding the innovations, why would these be needed?

Such a fund could sit alongside Patient Access Schemes (PAS) and potential new, innovative pricing mechanisms.

The ‘real’ NHS could see and seize the opportunity to have all its new medicines paid for out of the Fund, think of the impact on the adoption of innovation. The government would be happy because the industry would be paying. The industry would be happier because its rebates would be at long last used for what it was intended. Most important of all, patients would be better off because they would be accessing the new innovative medicines that make a difference to their lives.

This would make the systems work for patients and we would have done something worthwhile. But, if it happens and is made to work, don’t expect the reputation of the pharmaceutical industry to transform overnight.

I started with the relationship between the industry and the NHS. Maybe we confuse a cordial relationship with an effective one.
We cannot make everyone love us, so let’s do what we do best – produce some of the best science in the world and build a system that gets it to the people who really need it.​