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UK value-based pricing could encourage regenerative medicine

02/07/2013

The UK's proposed value-based pricing system, along with adaptive licensing and swift reimbursement, could encourage development of regenerative medicines, according to a report from politicians.

Monday's House of Lords (upper house) report into regenerative medicine made a series of recommendations to encourage development of these treatments, based on evidence from experts at a string of hearings.

 

The House of Lords Science and Technology Committee report warned that the UK may not make the most of its excellent scientific knowledge and access to clinical data from hundreds of thousands of National Health Service (NHS) patients, which could help to develop these medicines, without reform to regulatory procedures and pricing.

 

Authors were highly critical of the bureaucracy hindering research into regenerative medicine in the NHS, echoing claims have been made before by many commentators.

 

The report authors said value-based pricing offered a potential way of rewarding development of advanced therapies such as regenerative medicine.

 

They point out that under the system, cost effectiveness body NICE will assess value of medicines, effectively allowing higher prices for drugs where there is greater burden of illness, where treatments are scarce or non-existent or symptoms are severe.

 

NICE will also assign higher prices for medicines that can "demonstrate wider societal benefits," according to the report.

 

According to the authors - whose report was provided on evidence from 17 hearings over five months - this "sounds promising" but it is currently unclear whether the system will extend to "all forms of regenerative medicine".

 

The Lords cited evidence provided by The London Regenerative Medicine Network which suggested "value-based pricing seemed likely to work as beneficially for cell therapies and regenerative medicines as for other new medicines as it can take account of additional value gains and wider health benefits, which the traditional 'QALY' approach may have missed."

 

Value-based pricing may encourage investment where treatments have high up-front costs, according to the report.

 

Adaptive licensing, which allows for early conditional approval based on more limited evidence than currently required, followed by fast reimbursement decisions, would make regenerative medicine projects more attractive to investors, according the report.

 

Authors stated that "some witnesses argued that staggered reimbursement - which could be one outcome of adaptive licensing, some form of dual track approval system or early access schemes - would encourage investors to invest earlier as it provided a clearer and more immediate potential return on investment."

 

"The UK government must ensure that its pricing and reimbursement systems are fit for purpose otherwise companies will base themselves in other countries," authors wrote.

 

According to figures quoted in the report, between 2004-2010, the UK hosted the second highest number of advanced therapy clinical trials in the EU (46), with Spain leading the way with 71 such trials.


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