NHS England is to start evaluating the cost effectiveness of medicines available through the cancer drugs fund in a bid to bring the spiralling budget under control.

A number of drugs currently available through the controversial fund are expected to drop off the list as a result of the overhaul agreed by NHS England’s board last week.

Packets of drugs

NHS England decided to overhaul its operating procedure for the fund after it a £40m overspend last year

As well as considering the cost of drugs for the first time, its new standard operating procedure for the fund will also raise the threshold for clinical effectiveness.

A paper presented to the commissioning body’s board meeting said the new procedure would introduce an incentive for pharmaceutical companies to drop the prices of their drugs.

“The intention is to remove drugs of lesser benefit from the list and also potentially those more effective but very costly drugs,” the papers state.

“For this latter group of drugs, the manufacturer has an option to reduce the price and thereby retain funding by the [fund]”.

About 55,000 patients have benefited from the approximately £750m paid out through the fund since it was introduced by the coalition government in 2010.

While this is equivalent to an average of nearly £13,500 per patient, many of the 80 drugs available through the fund cost considerably more.

The most expensive is Roche’s Kadcyla at £90,000 per patient. It has been found to extend the lives of patients with advanced breast cancer by six months compared with routinely prescribed treatments.

Almost two-thirds of the fund goes on drugs that, like Kadcyla, have been rejected by the National Institute for Health and Clinical Excellence on the grounds they are not cost effective.

NHS England decided to overhaul its operating procedure for the fund after it was overspent by around £40m last year.

The changes are due to be introduced before the end of the financial year and ahead of the general election in May.

However, patients already receiving treatments will continue to have them funded and drugs that are the only treatment for a particular form of cancer will continue to be funded.

The charity Breakthrough Breast Cancer recently launched a campaign calling on drug companies to set fair prices for their drugs after three breast cancer drugs were rejected by NICE in quick succession.

Senior policy manager Caitlin Palframan accepted NHS England was in a difficult position but told HSJ that rather than “tweaking” the fund the body should focus on finding a longer term solution for patients to access these drugs.

“The cancer drugs fund was intended as a safety net to ensure these expensive drugs could be made available.

“If the fund starts looking at cost effectiveness as well as clinical effectiveness then it has changed its nature,” she added.

The Association of the British Pharmaceutical Industry’s director of value and access, Paul Catchpole, said the solution was to improve NICE processes for assessing cancer drugs.

“We are disappointed by NHS England’s decision,” he added.

“There is a risk that by evaluating medicines in this manner important costs and benefits will be missed out of the process, potentially resulting at best in misleading conclusions being drawn and at worst NHS patients being denied access to [cancer drugs fund] medicines which provide significant health benefit.”

HSJ understands NHS England will launch a consultation on which drugs should be removed from the fund later this week.