UK - Study Finds Huge Variations in Funding for Off-Label Cancer Drugs

There are huge variations in the way that NHS trusts are funding drug treatments for patients with rare cancers, according to a new report from the Rarer Cancers Forum, published on 14th August 2009.

Off-label treatments are often used in patients with rare cancers, as there are few licensed products for these specific cancers. Instead, the treatments prescribed are licensed for common cancer areas, but where the cancers have a similar underlying disease process. However, since the treatments necessary are not licensed for this use, patients must apply to their NHS trust to obtain them.

The report, Off limits - an investigation into NHS organisations’ policies and processes for determining requests for the use of off-label treatments for people with cancer, found that the opinion of trusts towards this form of prescribing, known as ‘near-label prescribing’, varies widely. It found that over the past three years, over 3,000 patients have applied to their Primary Care Trust (PCT) for funding for off-label treatments, and more than 1,000 have had their requests rejected. The study also assessed that patients with rare cancers in the UK are less likely to have access to off-label treatments than in France and Germany.

The report makes 25 recommendations for improvements, including:

• Near-label cancer treatments should be funded at the national level;
• Mandatory guidance should be issued to the NHS on the near-label treatments used most frequently; and
• The pharmaceutical industry should contribute to the costs of running the new system, provided that patients with rarer cancers benefit from improved access to medicines.

Further reading - A detailed review of the UK pharmaceutical market is available from Espicom: The Pharmaceutical Market: United Kingdom (published June 2009)

UK - 40% of PCTS are Not Providing Approved Blood Cancer Drugs

Just 60% of primary care trusts (PCTs) and 35% of local health boards (LHBs) routinely use therapies recommended by the National Institute for Health and Clinical Excellence (NICE), a survey from Leukaemia Care has shown.

The survey, published in August 2009, found that 23% of PCTs and 22% of LHBs are still making Velcade (bortezomib) and MabThera (rituximab) only available through Individual Funding Requests (IFR), despite the fact that they are both approved by NICE (although MabThera was only approved in July 2009), suggesting that they are not adequately following NICE’s guidelines.

Leukaemia Care also found there is confusion over which treatments to fund for blood cancer patients. The survey found that 39% of PCTs in England and 30% in Wales fund treatment with dasatinib, even though it has yet to be approved by NICE. It has, however, been approved by the All Wales Medicines Strategy Group (AWMSG) but the survey did not show that dasatinib was more routinely funded in Wales, as expected.

Leukaemia Care has expressed concern that PCTs and LHBs are not responding to NICE guidelines for haematological cancer treatments in the same way as they do for other therapies. The body has come up with a five-point plan to help develop a more consistent and transparent process for funding treatment across England and Wales. The five suggestions are:

• The provision of a central reference point for guidance on new treatments;
• The faster introduction of the NHS Constitution, which safeguards the right of patients in England to NICE endorsed therapies;
• The introduction of a specific requirement to collect data on the guidance implementation;
• Better guidance on the use of IFRs; and
• Setting up procedures to record data on the uptake of treatment ‘top-ups’.

Further reading - An in-depth analysis of the UK pharmaceutical market is available from Espicom: The Pharmaceutical Market: United Kingdom (published June 2009)

UK - NICE Approves Use of Stelara for Psoriasis

The National Institute for Health and Clinical Excellence (NICE) approved the use of Stelara (ustekinumab) in the NHS in England and Wales, for adults with severe cases of psoriasis, in August 2009.

Janssen Cilag’s Stelara is a fully human monoclonal antibody and has been approved for use for patients who are considered to have severe psoriasis, according to the Psoriasis Area Severity Index (PASI) or the Dermatology Life Quality Index (DLQI). The therapy has also been approved for patients who are unresponsive or intolerant to other treatments such as ciclosporin and methotrexate.

In addition, the approval is under the condition of a pricing agreement with the manufacturer, whereby the 90mg vial necessary for patients weighing more than 100kg is provided at the same cost as the 45mg vial, to keep the cost per QALY at £9,335. NICE has also included in the guidance that treatment should be stopped in any patients who fail to show an adequate response to the drug after 16 weeks, judged as showing a 75% reduction in the PASI score, or a 50% drop alongside a 5-point lowering in the DLQI rating.

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)

UK - HIV Drug Intelence Approved for Use on the NHS in Scotland

The Scottish Medicines Consortium (SMC) approved Intelence (etravirine) for patients with HIV under the NHS in Scotland, in August 2009.

Tibotec’s Intelence is a next generation non-nucleoside reverse transcriptase inhibitor (NNRTI), and the company claims that it is the first to show efficacy in those patients resistant to the first-generation NNRTI therapies.

Further reading - An in-depth review of the UK pharmaceutical market, including some background information on the SMC, is available from Espicom: The Pharmaceutical Market: United Kingdom (published June 2009)

China - Essential Medicines System May Lead to Market Expansion

China’s pharmaceutical market looks set to grow even further in the short-term, with the establishment of an Essential Medicines System during the 2009-2011 period. The plan calls for an estimated 300-400 essential medicines to be made available at all public facilities, starting at the grassroots level.

The system is modelled after the WHO List of Essential Medicines, and its establishment is designed to widen access to medicines to all citizens, as part of its plans to create universal healthcare for all by 2020. The system is part of China’s mammoth healthcare reform plan, for which it has allocated US$124 billion (850 billion yuan) to be spent over three years.

In China, pharmaceuticals are sold in hospitals and drugstores, and the healthcare reform plan will inevitably see access to pharmaceuticals increase, as it will also involve the construction of around 2,000 county level hospitals, so that each county will have at least one such facility, the construction of 29,000 township hospitals and upgrading of another 5,000. The government will also fund the construction of village clinics in remote areas so that every village will have at least one unit by the end of the three-year period. The plan also calls for 3,700 community health centres and 11,000 community health stations to be established or upgraded in cities.

The Essential Medicines System is part of the country’s return to its socialist roots, which saw the adoption of market driven policies since the 1980s. This led to an expansion of the Chinese economy, but also saw the rich-poor gap divide grow. Over 700 million people (55.1% of the total population in 2007) were classed as rural in China, and per capita income levels remain some of the world’s lowest.

Further reading - An in-depth review of the Chinese pharmaceutical market, including more detailed information on the healthcare reform plan, is available from Espicom: The Pharmaceutical Market: China (published July 2009)

Ireland - Pharmacy Row Taken to High Court (UPDATE)

The High Court in Ireland has extended an injunction against 35 pharmacies on 10th August 2009, prohibiting them from withdrawing services under the Community Drug Schemes without the required notice of 30 days.

The injunction was sought by the Health Service Executive (HSE) against pharmacies in the Hickley and Bradley pharmacy groups, but the HSE has asserted that it will not hesitate to take action against any other pharmacies that breach their Community Pharmacy Contractor Agreements. The injunction hearing will be heard on September 9th 2009.

Around 500 pharmacies have terminated their contracts following pay cuts (see Ireland - Pay Cut Leads to Pharmaceutical Supply Crisis).

The Irish Pharmacy Union (IPU) has called the HSE’s decision to go to court “unhelpful”.

Mary Harney, the Minister for Health and Children, stated, “The new payment rates are now set in law. They have been in effect since 1st July. It is done. There will be no policy change, no change in the law to change the payment rates now.”

Ms Harney also said talks with the IPU were possible to resolve the dispute, but that mediation is not possible due to the High Court involvement, as “it is not possible to mediate law”.

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

India - Authorities to Reimburse Costs of Drug Shipments which Avoid EU

The Indian government is to reimburse drugmakers for the extra costs incurred when shipping their products to developing nations and avoiding the European Union (EU), where a number of shipments have been confiscated recently, it was announced in August 2009.

More than 20 shipments of generic drugs, manufactured by companies such as Aurobindo, Cipla and Dr Reddy’s, have been seized in the past 16 months, according to government officials. Shipments were seized in the Netherlands, France, Germany and the UK while on their way to Asia, Africa and Latin America, after claims that they were breaching EU intellectual property (IP) laws.

India is issuing a formal complaint to the World Trade Organisation’s dispute settlement body, claiming that the EU has misused customs regulations to unlawfully seize the medicines. Particularly highlighted is EC Regulation 1383/2003, which is designed to protect the IP rights of EU member states and allows the seizure of shipments infringing IP regulations or if they are believed to be counterfeit.

A group of non-governmental organisations have called for the World Health Organisation (WHO) and the WTO to investigate the issue. They also pointed out that, under WTO rules, IP rights apply at the shipment’s departure and destination locations only, and so represent a violation of TRIPS Agreements.

Meanwhile, the EU, according to Oxfam, is pushing for the rules to be extended globally through free trade agreements and the Anti-Counterfeiting Trade Agreement (ACTA), which is currently being drawn up by 12 nations and the EU. This is due to start its sixth round of negotiations in South Korea in November 2009.

Further reading - An in-depth analysis of the Indian pharmaceutical market, including some background information on intellectual property and TRIPS regulations, is available from Espicom: The Pharmaceutical Market: India (published June 2009)

USA - FDA Raises Access to Unapproved Drugs

The US Food and Drug Administration (FDA) issued new rules which will make it easier for seriously ill patients to receive unapproved investigational drugs, in August 2009.

The new rules apply to those patients who have no other treatment options available to them and are not eligible to participate in a clinical trial. There will also be a new website created for patients to find out more about access to investigational medicines.

Manufacturers will be able to charge for expanded access to such drugs, and the FDA hopes the move will encourage more pharmaceutical companies to develop investigational medicines.

The changes will not result in changes to the FDA’s drug approval processes, but are expected to increase applications for investigational drugs by up to 50%.

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

UK - United Drug and Medco Health Solutions Join Forces to Provide Home-Based Pharmacy Care

United Drug agreed a deal with Medco Health Solutions to provide home-based pharmacy care services in the UK, in August 2009.

The joint project will provide a range of services to NHS patients, including prescription drug dispensing and home delivery and on-site nursing care for the administration of oral, injectable and infused agents.

Currently homecare pharmacy services comprise around £1.6 billion of the UK’s prescription drug spending. Investments in services such as these have grown at an annual rate of over 20% over the past five years.

Further reading - An in-depth review of the UK pharmaceutical market, including some background information on pharmacy services, is available from Espicom: The Pharmaceutical Market: United Kingdom (published June 2009)

UK - NICE Approves Alimta for NHS Use

The National Institute for Health and Clinical Excellence (NICE) recommended Alimta (pemetrexed) for use in patients with non-small cell lung cancer in August 2009.

Eli Lilly’s Alimta can be used in combination with cisplatin on the NHS as a first-line treatment of locally advanced or metastatic NSCLC if the tumour has been confirmed as adenocarcinoma or large-cell carcinoma. In total, around 80% of lung cancers are the NSCLC type, and these are made up of squamous cell carcinoma (45%), adenocarcinoma (45%) and large cell carcinoma (10%).

Currently, the NHS treatment for NSCLC is Eli Lilly’s chemotherapy Gemzar (gemcitabine), which holds an 85% market share, followed by vinorelbine with an 11% market share.

NICE originally rejected Alimta in 2007, on the grounds that there was no evidence that the drug was more clinically or cost-effective than the other treatments already available.

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)

UK - Foundation Trusts’ Spending Plans are Over-Optimistic

Foundation trusts were warned that their spending plans up to 2012 are overly optimistic, by Monitor, the regulator of foundation trusts, in August 2009. The trusts have been asked to also submit a downside forecast, which will give a more realistic projection of future spending growth.

Overall, 115 trusts have forecast a growth in their income of 4.2% in 2009/10, 2.1% in 2010/11 and 1.6% in 2011/12. It is known that NHS funding will increase in the next two years but funding post-2011 has not yet been finalised.

Further reading - An in-depth analysis of the UK pharmaceutical market, including some background information on NHS funding, is available from Espicom: The Pharmaceutical Market: United Kingdom (published June 2009)

Ireland - Pay Cut Leads to Pharmaceutical Supply Crisis

Patients enrolled in Ireland’s Community Drugs Schemes have been encountering problems when trying to obtain their prescriptions since August 1st, as many pharmacists have stopped dispensing medicines under the schemes.

The action by the pharmacists follows the decision by Mary Harney, the Minister for Health and Children, to cut payments to pharmacists under the Schemes by 34% as a result of the financial crisis. Under the Financial Emergency Measures in the Public Interest Act 2009, the Minster announced on 18th June that payments would be reduced by 55 million euros to 495 million euros. This is similar to the amount received in 2006.

It was expected that up to 1,100 community pharmacists would stop dispensing medicines under the schemes.

Liz Hoctor, president of the Irish Pharmacy Union (IPU), said that the contingency plans put into place by the Health Service Executive (HSE) have been “totally inadequate”.

Meanwhile, Laverne McGuinness, the HSE’s national director of primary care, has accused the IPU of deliberately using inaccurate information to cause anxiety among patients, which “reflects very badly on the profession”.

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

UK - NICE Rejects Celgene’s Vidaza

The National Institute for Health and Clinical Excellence (NICE) rejected Vidaza (azacitidine) as a treatment for blood cancers in August 2009, because it is not a cost-effective use of NHS resources.

Celgene’s Vidaza is used to treat myelodysplastic syndromes (MDS), including chronic myelomonocytic leukaemia (CML) and acute myeloid leukaemia (AML). However, NICE considered it too costly for use among NHS patients, despite agreeing that the drug is clinically effective and even taking into account recent guidelines on appraising end-of-life treatments.

The recommendations can be contested up until August 24th and there will be a Second Appraisal Committee meeting on September 3rd.

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

UK - Dentists’ Earnings Published

The NHS Information Centre has published the earnings of dentists in England and Wales. The 2007/08 Dental Earnings and Expenses Report, England and Wales, details the earnings and expenses of self-employed primary care dentists. The report looked at Providing-Performer dentists, who had a contract with a local health body and performed other dental services, and Performer Only dentists, who performed dental services but did not have a contract.

The report revealed that a total of 382 dentists out of 20,000 had a gross income of over £300,000 between 2007 and 2008, and 1,172 had gross earnings of more than £200,000 over the course of the year. It also highlighted a pay difference between dentists in England and Wales, with the average pay in England being £88,870 and the average in Wales being £93,924.

The key findings of the report are:

• The average taxable income for Providing-Performer dentists was £126,807, compared to £65,697 for Performer Only dentists. The overall average was £89,062;
• The average expenses for Providing-Performer dentists were £218,843, compared to just £33,512 for Performer Only dentists; and
• The average gross earnings for Providing Performer dentists were £345,651, compared to £99,208 for Performer Only dentists.

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

UK - NHS Faces Bill of £400 million for Private Contracts

The NHS is facing a bill of £400 million in the next two years, when independent sector treatment centre (ISTC) contracts with private sector operators expire.

Around £200 million will be paid for operation capacity bought by Primary Care Trusts (PCTs) but not used, as it is estimated that the health service only delivered around 85% of the agreed number of operations. A further £200 million will be paid to buy the premises built by the private sector operators.

Since ISTCs opened in 2005, they have cut waiting lists and introduced competition. So far, they have provided more than 1.7 million operations and other procedures, helping to cut the maximum NHS waiting time to 18 weeks.

ISTCs were originally commissioned by the Department of Health. They offered a five-year deal guaranteeing volumes of patients, with a buy-back clause on the buildings, and prices around 11% higher than NHS prices.

It will now be up to PCTs to decide if they want to renew the contracts, under different terms, most likely with no guarantees of volume and standard NHS prices.

Health Minister Mike O’Brien insisted that the initiative had been value for money, claiming it had cleared a backlog of 250,000 NHS patients who had to be treated to reduce waiting times. He told the Financial Times, “We wanted to ensure we had sufficient capacity. And if you hit your target, as we have, you have value for money.”

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

UK - Report Forecasts Future for NHS Funding

A report into the possible future of NHS funding was published in July 2009. The report, How cold will it be? Prospects for NHS Funding: 2011-17, by The King’s Fund and Institute for Fiscal Studies, analyses how much of an impact the economic recession could have on NHS funding. Public spending will be inevitably hit by the financial crisis, and the report analyses the different outcomes this could have on the NHS in England between 2011/12 to 2016/17.

There are three possible funding outcomes over the next two spending review periods:

• ‘Tepid’ – annual real increases of 2% for the first three years, increasing to 3% for the final three years;
• ‘Cold’ – zero real change; and
• ‘Arctic’ – annual real reductions of 2% for the first three years, falling to 1% for the final three years.

The financial future of the NHS remains uncertain, and depends on the extent of tax increases and productivity levels. The report notes that over the next spending review period (2011/12-2013/14) the budget could reduce for all government areas, including the NHS, by an average of 2.3% per year. If the NHS were to be protected by a greater or lesser degree, this could result in greater cuts for other departments, although this could be lessened by an increase in taxes.

The changes to the budget could have implications on taxation. Even the ‘tepid’ scenario would require an increase in taxation (or reduction in spending on social security benefits and tax credits) of £6.9 billion, which would be equivalent to £220 extra per family, or raised through a 1.6% increase in the level of VAT.

The report notes that demographic pressures, including a rising and ageing population, are likely to cost the NHS around £1.0-1.4 billion extra each year at 2010/11 prices, and would require funding increases of around 1.1% to maintain quality. Only the ‘tepid’ scenario would provide enough money to cover this. These pressures are also adding to the demands placed on the healthcare system, and the report argues that productivity gains are essential, regardless of the future funding of the NHS.

The report notes that the NHS could fill this gap in funding with increased productivity levels. However, these would need to be significant if they were to make an impact. The report states that over the period between 2011 and 2017, the NHS would need to make gains of between £21.6 billion and £47.0 billion, equivalent to improvements of 3.4% to 7.4% per year, or £3.6 billion to £7.8 billion per year.

The report argues that the NHS in England is in some ways better prepared than ever to deal with the downturn. Current funding levels mean that it has employed more professionals, there have been huge improvements in the infrastructure and waiting times have been dramatically reduced.

Further reading - An in-depth analysis of the UK pharmaceutical market, including some background information on NHS funding, is available from Espicom: The Pharmaceutical Market: United Kingdom (published June 2009)

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)

UK - Number of Prescriptions Increase but Costs Fall

Prescriptions dispensed in England rose by 5.8% in 2008, while costs fell by 0.6%, according to figures from the NHS Information Centre released in July 2009.

In 2008, a total of 842.5 million prescriptions were dispensed, a rise of 5.8% over 2007, while the net ingredient cost of all prescriptions decreased by 0.6% to £8,325.5 million. Over the same period, the average net ingredient cost per prescription item fell by 6.0% to £9.88.

The leading BNF Chapter in terms of volume was the cardiovascular system, and in terms of cost was the central nervous system. The leading BNF Section in terms of prescription items dispensed was hypertension and heart failure and in terms of cost was drugs used in diabetes.

A total of 65.0% of prescription items were dispensed generically in 2008, representing 26.2% of the total cost.

Further reading - An in-depth analysis of the UK pharmaceutical market, including data on prescriptions dispensed, is available from Espicom: The Pharmaceutical Market: United Kingdom (published June 2009)

UK - 2008 Pharmacy Workforce Census Published

A census of the working patterns of pharmacists was published in July 2009. The fourth Pharmacy Workforce Census, compiled by the Royal Pharmaceutical Society of Great Britain, studied pharmacists registered in August 2008.

The survey had a high response rate of 69.6%. The key findings were:

• The Register increased by 1.7% between August 2007 and August 2008, which continues an upward trend since 1991;
• Pharmacists reported working the same number of hours on average as the 2005 census (35 hours), although men worked longer hours than women. The proportion of pharmacists working 49 hours or more per week increased by 1% since the previous census;
• There was an increase in the number of pharmacists working part-time, representing 32.3% of the working population. Part-time working, defined as 32 hours or less, was most prevalent in the primary care sector, with a total of 39.5%;
• Around 41.9% of pharmacists reported working long hours, and this figure rose to 52.2% for male pharmacists;
• Almost a third of pharmacists (30.3%) felt they did not have enough time to socialise outside of work, and a similar proportion (30.7%) wanted to reduce their working hours but felt they had no control;
• Male pharmacists perceived that they experienced more problems with a work-life balance than female pharmacists, apart from in the case of part-time work when the opposite was true;
• More than one in ten pharmacists (13.0%) are considering leaving the sector within the next two years, and a similar proportion (10.9%) are considering quitting the profession altogether.

The findings will be used to help inform workforce planning and policy development across the profession, under the General Pharmaceutical Council (GPhC) which is to be established in 2010. The research was undertaken by a team at the School of Pharmacy, University of Manchester and funded by the Department of Health.

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

UK - Experts Call for Consultation on Generic Substitution

Experts have called for a consultation on the effects of generic substitution, proposed to take effect from January 2010 as part of the Pharmaceutical Price Regulation Scheme (PPRS).

A report, which calls into question the proposal to introduce generic substitution, was endorsed by a varied group of experts and patient bodies in July 2009. The Department of Health plans to introduce generic substitution in January 2010, as stated in the PPRS, to drive down costs and reduce the NHS’ drugs bill. However, those opposing the move claim it will in fact increase costs and put patient safety at risk.

The report, which was compiled by CancerBACUP, the Primary Care Dermatology Society and the European Parkinson’s Disease Society, and was funded by Norgine, argues that the move could lead to patient confusion and, crucially, to poorer patient outcomes.

The report calls for a public consultation on “the practical impact of generic substitution on patients adherence and outcomes and the potential impact of varying bioavailability on outcomes and adverse events”.

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

UK - NICE Approves Basilea’s Toctino

The National Institute for Health and Clinical Excellence (NICE) approved Toctino (alitretinoin) as a treatment for eczema in July 2009. The Swiss group Basilea’s Toctino has been approved under the NHS for adults with severe hand eczema, with a dermatology life quality index score of 15 or more, who have failed to respond to therapy with topical corticosteroids. The drug, which costs £411.43 for a pack of 30 x 30mg capsules (excluding VAT), is considered a cost-effective use of resources as the cost per QALY is well below the threshold required.

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)

UK - NICE Publishes Guidance on Tenofovir Disoproxil

The National Institute for Health and Clinical Excellence (NICE) has published guidance on tenofovir disoproxil, recommending it for use in patients for whom antiviral treatment is indicated with chronic HBeAg-positive or HBeAg-negative hepatitis B. However, the guidance does not apply to patients with chronic hepatitis B who also have hepatitis C, hepatitis D or HIV.

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

UK - NICE Publishes Guidance on Rituximab

The National Institute for Health and Clinical Excellence (NICE) has published guidance on rituximab, recommending it as a first-line treatment for patients with chronic lymphocytic leukaemia, who are able to take fludarabine in combination with cyclophosphamide. The guidance states that rituximab is not recommended in combination with any other chemotherapy agents.

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

USA - Obesity Costs the US Healthcare System US$147 billion

A study has found that obesity-related diseases account for 9.1% of health spending in the USA, equivalent to around US$147 billion. Researchers also found that obese people spend 40% more in healthcare costs, equal to around US$1,429 more per year, than people of a normal weight.

RTI international, the Centers for Disease Control and Prevention (CDC) and the Agency for Healthcare Research and Quality analysed medical cost data for the years between 1998 and 2006. The findings showed that rates of obesity rose by 37% between 1998 and 2006, driving an 89% increase in spending for obesity-related disease treatments such as diabetes, heart disease and arthritis. It also found that an obese Medicare patient spends US$600 more each year in drug costs than a Medicare patient of a healthy weight.

The CDC issued 24 recommendations in July 2009, on how communities can tackle the problem of obesity, mostly by encouraging healthy eating and exercise.

Obesity accounts for 9.1% of health spending, up from 6.5% in 1998. In total, more than 26% of Americans are obese.

Further reading - An in-depth analysis of the US pharmaceutical market, including some background information on health expenditure, is available from Espicom: The Pharmaceutical Market: USA (published June 2009)

USA - Bristol-Myers Squibb to Acquire Medarex in US$2.4 billion Deal

Bristol-Myers Squibb Co. is to acquire Medarex Inc. in a deal worth US$2.4 billion, it was announced on 22nd July 2009. Medarex Inc. is a biotechnology company which has been assisting the US company Bristol-Myers Squibb in developing a treatment for melanoma since 2005. This is an antibody called ipilimumab for patients in the late stages of melanoma, and is now in the final stage trial. The deal is expected to help Bristol-Myers Squibb regain its position as one of the world’s leading players in the oncology market.

Further reading - A detailed review of the US pharmaceutical market is available from Espicom: The Pharmaceutical Market: USA (published June 2009)

India - Call for Tighter Rules on Clinical Trial Imports

India’s Central Drugs Standard Control Organisation (CDSCO) called for tighter rules on the import of larger quantities of drugs for use in clinical trials in July 2009. The proposal by the CDSCO asks for additional documentation and evidence when contract research organisations (CROs) or other companies apply to import large volumes of drugs.

Under Rule 33 of the 1945 Drugs and Cosmetics Regulations, small quantities of drugs may be imported into India for “examination, test or analysis” with a Form 11 licence. However, this does not state specifically what is considered to be a ‘small’ amount, and so more rules are necessary to control it. The new rules would apply to any quantities of drugs, bulk or formulated.

Further reading - An in-depth analysis of the Indian pharmaceutical market is available from Espicom: The Pharmaceutical Market: India (published June 2009)

UK - Innovative Medicines will Reach Patients Faster

Patients will have faster access to innovative medicines, under new proposals announced by the Office for Life Sciences on 14th July 2009.

The measures outlined in the ‘Life Sciences Blueprint’ include:

• The introduction of an Innovation Pass, administered by NICE, which will allow time-limited use of selected innovative medicines on the NHS. The selected medicines will be those which can deliver improved patient outcomes to a small number of patients, but where a lack of cost-effectiveness data is limiting market access. Therefore, they will be funded without going through a NICE appraisal. However, NICE will develop and apply eligibility criteria for the Pass, giving patients with the greatest need earlier access to innovative drugs. The medicines will be evaluated by NICE after the three-year initiative comes to an end. The Pass will be piloted in 2010/11, with a budget of £25 million from the Department of Health.
• The NHS Chief Executive will review system levers and incentives, including Payment by Results, to accelerate the uptake of new medical technologies.
• The Government will reinforce the need for greater emphasis on research and clinical trials in the next NHS Operating Framework.
• The Government will support the formation of a UK Life Sciences Super Cluster to co-ordinate work across industry, higher education and the NHS, and to boost international recognition of UK life sciences.
• The blueprint calls for the Treasury to further investigate the possibility of a ‘patent box’ tax incentive, offering a lower rate of tax on profits derived from patents located in the UK to encourage the creation and exploitation of intellectual property in the UK.
• The Technology Strategy Board will launch an £18 million ‘RegenMed’ programme of investment to support commercial R&D and the development of NHS partnerships, supported by an additional funding of £3.5 million from Research Councils.
• The Government will invest an extra £1 million to promote the UK and NHS brands at flagship life sciences events in the UK and overseas.

The Office for Life Sciences was created on 27th January 2009 and has since been working on this package of measures to transform the operating environment for life science companies in the UK. The next step will be to develop detailed delivery plans for each action, which will be published in the autumn.

Further reading - A detailed review of the UK pharmaceutical market is available from Espicom: The Pharmaceutical Market: United Kingdom (published June 2009)

UK - Think-Tank Proposes £20 Fee for GP Appointments

Patients should be charged £20 for an appointment with a GP to encourage people to visit a doctor only when necessary, according to a report by independent think-tank the Social Market Foundation (SMF).

In the report, From feast to famine: reforming the NHS for an age of austerity, published in July 2009, the SMF states that the NHS will need to change dramatically to survive the impact of the economic downturn. The think-tank says the NHS will have to become more efficient due to the reduction in funding, and change its approach to what is fair. The report outlines three possible approaches that the NHS can take: raise more money, use existing resources better, or slow the growth in healthcare demand.

The report says the NHS must recognise that fair does not necessarily mean free. Charges could not be used to raise revenue, as they would need to be set at a very high level to do so, but charging for access to healthcare could force patients to consider whether they need to use healthcare resources.

The report recommends:

• The NHS charging system should be reformed to reflect income not categories such as pregnancy or retirement;
• Anyone receiving tax credits should be exempt from NHS prescription charges - a good deal for the poorest 30% of society;
• A charge of £20 for GP appointments should be introduced to encourage healthier, wealthier people to avoid using the NHS except when absolutely necessary (those receiving tax credits will be exempt);
• NHS charges for GP appointments and prescriptions should be capped at around £100 per year.

The report also outlines that the only way to achieve efficiency is to move from national targets to a model of local provision based around high quality commissioners. Recommendations to improve efficiency include:

• A reduction in national targets to become a minimum service guarantee;
• The establishment of a single body to regulate commissioners;
• Local contracts for GPs and consultants;
• Public petitions that can trigger a review of commissioner performance;
• A new ‘Royal College of Commissioners’ to give commissioning higher status;
• New powers and responsibilities for commissioners to improve the quality of healthcare providers.

However, Dr Chaand Nagpaul, on the GP committee of the British Medical Association, expressed concern that some patients may be put off visiting a doctor because of the fees. He commented, “All patients have the right to free healthcare that is based on their clinical needs, not the size of their bank balance.”

The Department of Health said ministers are also opposed to charges, with a spokeswoman commenting that it would be against “the founding principles of the NHS”.

Further reading - An in-depth analysis of the UK pharmaceutical market, including some background information on the healthcare system, is available from Espicom: The Pharmaceutical Market: United Kingdom (published June 2009)

USA - Legislation on Drug Re-Importation Approved

American citizens could obtain drugs from Canada at a lower price, under plans approved by the US Senate. The amendment proposing re-importation passed the Senate by a 55 to 36 vote on 9th July 2009, as part of the Homeland Security funding bill.

Prices of drugs in Canada are far lower than in the United States, and the amendment would allow prescription medicines sanctioned by the US Food and Drug Administration (FDA) to be purchased either in person or over the internet.

The amendment was proposed by Senator David Vitter, who said in a statement, “This is a huge win for Americans concerned about the lowering of the cost of common, expensive prescription drugs and a major defeat for the big drug companies and their powerful lobbying interests.”

The Pharmaceutical Research and Manufacturers of America (PhRMA) opposes re-importation and said that the FDA does not have the resources to monitor the safety of drugs coming into the country.

Currently, American visitors can return from Canada with a three-month supply of drugs, a measure which is supported by the PhRMA.

However, it remains to be seen whether Vitter’s amendment will be kept in the legislation after it goes through the House-Senate talks on a final version of the bill.

Further reading - An in-depth analysis of the US pharmaceutical market, including some background information on legislatory matters, is available from Espicom: The Pharmaceutical Market: USA (published June 2009)

USA - FDA Panel Votes Against Yondelis for Ovarian Cancer

The US Food and Drug Administration (FDA) voted against recommending approval for Yondelis (trabectedin) for ovarian cancer in July 2009. The drug was submitted by partner Johnson & Johnson (J&J).

The FDA’s Oncologic Drugs Advisory Committee (ODAC) voted 14-1 against approval of Zeltia’s Yondelis for the treatment of relapsed ovarian cancer, in combination with J&J’s Doxil/Caelyx (doxorubicin). The drug was shown to have a six-week benefit in progression-free survival in a Phase III trial, but the panel decided this does not justify the use of the drug.

The ODAC also noted that there was a notable increase in severe and life-threatening adverse events in the Yondelis treatment group, including more than twice as many pulmonary embolisms, three times more cardiac adverse events and a higher rate of liver enzyme increases.

J&J’s Centocor Ortho Biotech unit said that it still believes trabectedin “has an important role in the treatment of recurrent ovarian cancer” and “remains committed to working with the FDA to address the committee’s concerns".

Further reading - An in-depth analysis of the US pharmaceutical market is available from Espicom: The Pharmaceutical Market: USA (published June 2009)

Japan and USA - Hisamitsu to Acquire Noven Pharmaceuticals

Japan’s Hisamitsu Pharmaceutical Co will buy the USA’s Noven Pharmaceuticals for US$428 million in cash, in a deal announced on 14th July 2009.

Hisamitsu, which already has a 4.9% stake in Noven, will pay US$16.50 per share to expand its presence in the USA. Noven, which specialises in hormone therapies for women, will become a wholly owned subsidiary of Hisamitsu but will remain a standalone business unit with its current workforce.

The deal is expected to be completed in August 2009.

Further reading - Detailed reviews of the pharmaceutical markets in Japan and the USA are available from Espicom: The Pharmaceutical Market: Japan (published June 2009) and The Pharmaceutical Market: USA (published June 2009)

Germany - Hospital Chain Plans to Make Acquisitions

The largest hospital chain in Germany, Rhön Klinikum, is expecting the recession to trigger a number of hospital privatisations and plans to raise 460 million euros (US$644 million) in fresh capital and boost its equity base by one third so it is ready for buying opportunities.

The chain expects the recession to mirror the events of 2002 and 2003, when private operators lifted their share of the market to 13.5%, compared to 7.4% in 2000, as public assets were sold.

According to the chief executive, Wolfgang Pföhler, Rhön spent 960 million euros (US$1,345 million) on 20 hospitals between 2002 and 2006, and it now runs 48 clinics and has control of 3.0% of all hospital beds in Germany.

Mr Pföhler said that he expected the non-profit sector to maintain its market share but suggested the market share of publicly owned institutions could shrink notably. He believes Rhön can more than double its share of beds to 8.0% in the coming years and the chain aims to offer a nationwide service eventually.

In 2005, Rhön became the first private operator in Europe to take over a university hospital and its research department. It has since pledged to invest almost 400 million euros (US$560 million) in the facility in Giessen and Marburg, central Germany.

However, Mr Pföhler conceded that Rhön faces stiff competition from its two main German rivals, Helios Kliniken, owned by Fresenius, and Asklepios Kliniken, which each control around 3.0% of beds.

Further reading - An in-depth analysis of the German pharmaceutical market, including some background information on the hospital sector, is available from Espicom: The Pharmaceutical Market: Germany (published June 2009)

Brazil - The consolidation of the Brazilian pharmaceutical distribution sector continues

Celesio invests in Brazil …

The German Celesio, the largest European wholesaler, acquired a majority stake in the leading Brazilian pharmaceutical wholesaling group Panpharma in July 2009. This is Celesio’s first acquisition outside of Europe, triggered by the company’s lost bid to overturn pharmacy ownership laws in Germany and Italy. The move will also help Celesio to diminish its reliance on the British pharmaceutical market which has been affected by price cuts in generic medicines and the weakness of the British pound against the euro. Founded in 1976, the Panpharma group comprises the Panarello, Sudestefarma and American Farma companies. The group has about 17.0% of the Brazilian retail pharmacy sector and is expected to increase its market share following Celesio’s investments.

Growth opportunities …

Brazil is the largest pharmaceutical market in Latin America and one of the most attractive BRIC markets. Espicom Business Intelligence projects a CAGR of 7.9% over the next few years. Between 1997 and March 2009, annual cumulative pharmaceutical sales more than trebled in local terms, whilst they nearly doubled in dollar terms. Consumption levels by volume have increased particularly since 2004, as the market is becoming more generic-lead. In fact, Brazil has the largest generic market in Latin America. The industry expects to do well in the current economic downturn and generics are expected to represent 20.0% of the retail pharmacy sector by volume in 2010. sanofi-aventis’ acquisition of Medley, announced in April 2009, is going to change the generic market, with increasing foreign participation.

Further reading - An in-depth analysis of the Brazilian pharmaceutical market is available from Espicom: The Pharmaceutical Market: Brazil

South Africa - National Health Insurance, Can Zuma Deliver?

The long term growth prospects of the South African pharmaceutical market will be strongly influenced by the ANC government’s policies in regards to the new National Health Insurance (NHI) scheme, the promotion of public-private partnerships to develop and upgrade hospitals, the serious shortage of healthcare personnel and an urgent need to effectively address the AIDS crisis in the country.

The AIDS situation is dire in South Africa. According to projections from the EIU, the population of South Africa will start to decline from 2011, not normal for a country which has a relatively low elderly demographic (estimated 5.7% of the total population in 2011) and one of the highest birth rates in the world (25 live births per thousand population).

In 2008, there were a total 34,687 doctors or medical practitioners registered with the Health Professions Council of South Africa (HPCSA), equal to less than one doctor (0.7) per thousand population. This rate is very low by world standards. The majority of these doctors worked in the private sector, with only 30.7% or 10,653 working in the public sector in 2008. This means the provision rate for doctors in the public sector is just 0.2 per thousand population.

Private hospitals and doctors were unhappy with the government’s proposed National Health Amendment Bill in June 2008, which would have resulted in private hospitals and medical scheme providers having to “negotiate” private healthcare fees. At time of writing, nothing had been finalised.

A key driver of growth is expected to be the public-private partnerships to develop hospitals in South Africa but this could be tempered slightly, by a depreciating rand against the US dollar and the general state of the South African economy.

Further reading - An in-depth analysis of the South African pharmaceutical market, including some background information on the healthcare system, is available from Espicom: The Pharmaceutical Market: South Africa (published June 2009)

Mexico - A New Pharmaceutical Landscape

A changing regulatory environment …

The shape of the Mexican pharmaceutical market is changing rapidly, due to increasing regulatory measures and the economic downturn. Producers are renewing their drug registrations, as the deadline is coming closer. By February 2010, there will only be patented and bioequivalent generics in the market. Further regulatory changes affecting the market include the regulation of biologic and biosimilar drugs and the elimination of pharmaceutical manufacturing requirements in the country. The economic downturn has also encouraged generic sales in both the private pharmacy and public sectors to the detriment of branded sales which are falling.

Increasing generic sales …

Opportunities, particularly for generic sales, have increased in Mexico, but these need to be measured carefully. The generic market is going to increase in both the private pharmacy and public sectors, but threats do exist. Most of the generic market is still in the public sector. However, the public sector wants to fix drug prices for the 2010 period, as it did in 2009. This measure has proven very unpopular for the industry, because the exchange rate fixed in 2008 is no longer unrealistic for a peso which has lost about half of its value against the dollar. Even if it is able to fix drug prices for 2010, how is the public sector going to quantify the effects of the changing regulation?

A recent wave of acquisitions …

Due to an unfavourable exchange, production and operational costs have increased by 40% in 2009. Also, producers have had to absorb high costs associated with the renewals of their drug registrations in the last two years. However, the process has not been easy and has been more difficult for small producers. Therefore, some of them are on sale. Foreign producers are actually increasing their participation in the Mexican pharmaceutical market: Valeant announced the acquisition of Tecnofarma in July 2009, whilst sanofi-aventis purchased Kendrick early in 2009. The industry still expects more acquisitions in the short-term.

Further reading - An in-depth analysis of the Mexican pharmaceutical market is available from Espicom: The Pharmaceutical Market: Mexico (published June 2009)

South Africa - Battle Intensifies for Lucrative HIV/AIDS Drug Market

South Africa has one of the highest rates of HIV/AIDS infections in the world; according to latest government estimates, around 5.4 million people were infected by HIV, just over 10% of the entire population. The true picture could be even more widespread, as these estimates were derived using mathematical models based on surveys done on pregnant women.

The market for antiretroviral (ARV) drugs looks set to grow; after years of not addressing the severity of the problem, the government has now started to look at ways to increase the supply of these drugs via the public system.

In June 2009, president Jacob Zuma, in his first State to the Nation Address endorsed the establishment of a National Health Insurance (NHI) scheme. Zuma said the scheme, which aims to provide universal health for all South Africans, will be implemented in phases. There is little detailed information, at this stage, on how the scheme is to be implemented.

International tendering exists, but as Aurobindo, one of the world’s largest producers of generic ARV drugs found out, does not always work in favour international companies. The Indian drugmaker, in June 2009, announced that it plans to sue the government, on claims that it had lost out to local manufacturers in a R400 million (US$38.1 million) contract for ARVs, although its price was 30% cheaper on the tender.

The government increased prices by 5% in 2006, and 6% across 2007 and 2008, but the industry complained these increases were below the rate of inflation. In January 2009, prices were increased by 13.2% by the DOH, a move that was welcomed by the Pharmaceutical Industry Association of South Africa (PIASA), which said the increase helped combat increasing margin pressures experienced in 2008 due to mainly imported raw materials against a weakening local currency.

The government, although wanting to back the local industry with protectionist measures, could be tempted to procure more drugs from countries like India and China, who can provide a higher volume of drugs for the same tender price compared to local companies.

Further reading - An in-depth analysis of the South African pharmaceutical market, including some background information on HIV/AIDS infections in the country, is available from Espicom: The Pharmaceutical Market: South Africa (published June 2009)

Philippines - Drug Price Cuts, Pfizer a Prized Scalp in this New Order?

Despite desperate manoeuvring - which included allegations of Pfizer attempting to bribe the Department of Health (DoH) as a delay tactic - the government in July 2009 imposed price controls on pharmaceuticals for the first time since the 1970s.

As it stands, the multinationals, who have long controlled much of the Philippines market, have been dealt a severe blow, and look set to lose more ground, as the government has expressed its intention to cut even more prices in the future.

Philippines president Gloria Arroyo, on 27th July 2009, signed an executive order to slash the prices of five essential medicines by 50% effective 15th August 2009. The prices of other medicines, part of the 22 essential medicines by the government, were voluntarily cut before the deadline by manufacturers.

Pharmaceutical companies were given the opportunity to voluntarily reduce prices for the said drugs prior to that and most did reduce their prices. With the deadline looming, Pfizer instead tried to offer the Health Secretary Francisco Duque five million “discount cards” reportedly worth around P100 million (US$2 million) to delay the enforcement of the Cheaper Medicines Law.

The Department of Health perceived this as a bribe, although Pfizer have denied any wrongdoing, saying it was part of the company’s “continuing commitment to expand access to its high quality, safe medicines nationwide”. In a country with a population around 95 million, mainly poor people, the effectiveness of five million, one-off discount cards was questioned by Senate president Juan Ponce Enrile.

The Cheaper Medicines Law, or the Universally Accessible Cheaper and Quality Medicines Act of 2008, was approved in June 2008, but this is the first time that it has been enforced by the president. Allegations of corruption in the Philippines political landscape is not something new, but Pfizer probably miscalculated in trying to offer the discount cards to Health Secretary Francisco Duque, one of the stronger advocates of the Cheaper Medicines Law.

President Arroyo’s time in office has not been without controversy, notwithstanding allegations of corruption and election rigging, and her popularity has suffered especially with the poor majority of the population. The enforcement of reducing prices of drugs by 50% was part of her early promise to voters, and is only now being implemented. Populist politics some might say, but industry players are gearing up for the challenges and opportunities that lie in this largely untapped market.

Further reading - An in-depth analysis of the pharmaceutical market in the Philippines, including some background information on pricing, is available from Espicom: The Pharmaceutical Market: Philippines (published June 2009)