Viewpoint: How the shift to CCGs might affect the use of medicines
By Stephen Whitehead, 06 August 2012
The NHS could not survive without the medicines produced by my industry, writes Stephen Whitehead, chief executive of the Association of the British Pharmaceutical Industry (ABPI)
The reforms that have swept through the NHS over the last year, have attracted more media and political interest than perhaps any other health issue I can think of in the last decade. The changes have generated countless articles, fierce debate and endless analysis and critique. But one area which I can’t seem to recall receiving attention is how the shift in the commissioning of services from SHA to clinical commissioning groups (CCGs), might affect the use of medicines.
Why is this important? Well, the medicines produced by my industry, underpin modern healthcare, and it really is no exaggeration to say that the NHS could not survive without them. I am proud to say that they improve and save the lives of millions of people across the world and new medicines are researched and developed every year to address unmet clinical need. Their appropriate use can make the difference between a patient living a normal healthy life or a patient struggling with illness and the effects of disease.
NHS budget squeeze
Given their importance, the question then is how should the NHS choose which medicines to use, and in what way? Or to put it differently, in a system of finite resources and a squeeze on NHS budgets – how should CCGs, decide what the UK should spend on medicines?
It is not possible, or even sensible, to place an arbitrary figure on how much we should invest in medicines. But I think it makes sense for CCGs, which now hold the purse strings for the first time, to consider a number of key points.
Firstly, spending on medicines is actually very reasonable in the UK. We spend 0.9% of our GDP on medicines, compared with the European average of 1.2%. Our spend as a proportion of the NHS budget is set to rise in line with the overall healthcare budget, and the expiry of patents means many treatments are now being prescribed at a fraction of their original cost. In sum, it is fair to say that our spending on medicines is quite reasonable and the facts dispel the myth that the drugs bill is spiralling out of control.
Branded spending to fall
But what is particularly striking when we look at spend on medicines is that over the next three years, spending on the most innovative branded medicines is set to fall significantly. This is according to the latest ABPI/Office of Health Economics forecast. So by 2015, new branded treatments launched between 2012 and 2015 will account for less than 2% of the total amount spent by the NHS on medicines.
This for me is a real worry because it means patients will not be offered the newest and best treatments to help them manage their disease. This is a trend I have been aware of for some time and is reflected in DH national cancer director Professor Sir Mike Richards’ report in to the uptake of medicines. His review found that despite the UK being one of the wealthiest countries in Europe, we fall outside of the top 10 for the usage of new cancer medicines launched in the last decade. We also fail to make the top 10 for usage of dementia, multiple sclerosis and rheumatoid arthritis medicines and others.
CCGs better than SHAs
I believe that CCGs will share these same concerns because they have a fuller understanding of a patient’s needs. With clinicians having front line experience of treating people day in, day out, and appreciating how medicines can improve patients’ lives, CCGs should be better placed to make decisions on medicines spending compared with SHA managers. Practising health professionals also appreciate that when medicines are used in the appropriate way, they can save the system money by changing a patient’s pathway and mitigating the effects of their disease. This reduces their need for expensive secondary care in later months or years by slowing, or sometimes even stopping the progression of their illness.
A final point for consideration is if medicines are not used by the NHS, it means pharmaceutical companies will struggle to research and develop new treatments because they will be unable to generate a sufficient return on their initial investments. This is a serious issue because we need medical science to advance and new cures to be discovered as we continue our battle with disease. The level of investment required to bring a new medicine to market is significant - it takes on average 12 to 15 years to develop a medicine, at a cost of over £1bn. Whilst only one in every 5,000 of these chemical compounds ever actually makes it to market. These are huge risks and costs industry has to overcome and that is why when the NHS buys the medicines of today, they are investing in the medicines of tomorrow.
As we look to the future, I am hopeful we can move away from the days of silo budgeting and start to see medicines for what they are, an investment and not simply a cost. I believe newly empowered clinicians will make the right decisions when they allocate resources for medicines spending and will put patients first and secure the long term success of the NHS.
- Stephen Whitehead is chief executive of the ABPI.
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