UK - Kennedy’s Innovation Report Published

A study into innovation within the pharmaceutical industry was presented to a NICE board meeting by Sir Ian Kennedy on July 22nd 2009.

The report outlines recommendations on how NICE can ensure its appraisal procedures take innovation into account and how innovation should be defined. It was commissioned in response to a report by Sir David Cooksey, Review and Refresh of Bioscience 2015, which called for an independent review into the importance of innovative medicines and new health technologies.

Sir Ian is particularly critical of the recent change to NICE’s consideration of end-of-life treatments, warning that they could represent a ‘Trojan horse’ making it increasingly difficult for NICE to withhold approval.

The recommendations have some similarities with the idea of an Innovation Pass, which would allow some drugs to be made available on the NHS without having gone through a NICE appraisal, as proposed in the Office for Life Sciences Blueprint on 14th July 2009.

Some of the recommendations are:

• NICE’s appraisals should continue to be based on the ICER/QALY approach into which is incorporated explicit consideration of relevant benefits. A two-stage approach should not be adopted;
• NICE should consult all relevant parties and draw up a list of those health-related benefits to be taken into account in its appraisals. The list should be reviewed through an appropriate mechanism from time to time;
• Social benefits should not currently be taken account of by NICE in its appraisals, but NICE should commission or participate in research to determine whether such benefits could form part of NICE’s approach and, if so, how;
• NICE should work with others to develop an active policy on disinvestment by the NHS in products which do not offer value for money;
• NICE should formulate a definition of ‘innovation’. So that a judgement can be made that a product meets the NHS’ needs, the Secretary of State for Health should from time to time make explicit the priorities of the NHS regarding intervention and treatment;
• NICE should establish a mechanism whereby pharmaceutical companies can signal as early as possible that a product may constitute an ‘innovation’. NICE should work closely with pharmaceutical companies, using for example its scientific advice programme, to ensure that the data required by NICE to make this judgement is generated. NICE should offer advice and support to newer companies to facilitate competition in the sector. NICE should consider, as incentives to pharmaceutical companies, agreeing a higher threshold in the case of ‘innovation’ (as defined) and maintaining it for a fixed period or agreeing the use of a scheme under the revised PPRS (flexible pricing or patient access). NICE should revisit the threshold to be used in the appraisal of products which do not meet the criteria of innovation if a higher threshold or one of the schemes under the PPRS is used as an incentive to promote innovation;
• NICE should establish a mechanism whereby the NHS is compensated for the financial loss incurred, if a product subsequently proves not to meet initial expectations;
• NICE should build on its reputation as leading the world in the appraisal of products to establish itself also as a world leader in promoting innovation and the early adoption of treatments;
• NICE should urge government to make appropriate adjustments to the supply side, as recommended by Sir David Cooksey and the Office of Life Sciences to encourage innovation on behalf of the NHS and patients;
• NICE should only offer incentives for innovation when it is realised;
• NICE should consider establishing a formal and transparent process, using such options available to it to offer incentives to pharmaceutical companies when a product is said to have the promise of innovation. NICE should pilot the process for a period of time if it decides to establish it;
• NICE should work with the Office of Life Sciences such that, if an ‘innovation pass’ is thought necessary and appropriate, conditions apply. NICE should establish a committee of experts to advise on whether the criteria for use of the ‘innovation pass’ are met. NICE should seek to ensure that funding for the purchase of the products subject to the ‘innovation pass’ comes from a specially created fund and not from the NHS. NICE should seek to ensure that the ‘innovation pass’ during which a product is not evaluated by NICE should last for a fixed period of time (e.g. a maximum of three years). NICE should seek to ensure that at the expiry of the fixed period of time the product is appraised by NICE and falls within the threshold for approval;
• NICE through its Medical Technology Advisory Committee should play an increasingly active role in encouraging research into medical technologies to be carried out in the UK.

NICE will issue a formal response in September, which will be followed by a three-month public consultation.

Further reading - A detailed analysis of the UK pharmaceutical market, including some background information on NICE, is available from Espicom: The Pharmaceutical Market: United Kingdom (published June 2009)