A new pricing system for pharmaceutical drugs used in the NHS has been proposed by the government, which it claims will increase patient access to effective medicines.

A consultation on the new “value based pricing” system, which will replace the Pharmaceutical Price Regulation Scheme, was announced yesterday by the Department of Health having been originally proposed in the health white paper.

While the Pharmaceutical Price Regulation Scheme seeks to achieve a “balance between reasonable prices for the NHS and a fair return for the industry”, the new system will look at how a drug’s value can “best be measured and reflected” in the price the NHS pays for it, with drugs priced according to how they benefit patients.

For example, a higher cost effectiveness threshold would be applied to medicines that tackle diseases where there are few drugs or treatments available or which are particularly severe.

Medicines that demonstrate wider societal benefits, for instance reducing the amount of a time a patient spends with a carer, would also have a higher threshold.

The consultation paper states the National Institute for Health and Clinical Excellence will be “the key source of advice on the relative cost-effectiveness of new medicines” but the exact detail of its future role will be determined by the results of the consultation.

The system, which is due to be introduced at the end of 2013, is also intended to stimulate innovation and development of high value drugs.

Health secretary Andrew Lansley said: “I do not want in future for the effect of the medicines pricing system to be the denial of effective and appropriate treatments to NHS patients.

“So we need to change the way drugs are priced and ensure value for money for the NHS. Doctors should be able to focus on what matters most – achieving the best health outcomes for their patient, not debating the relative value and price of a drug.

“Value based pricing will ensure that the price the NHS pays for medicines are based on an assessment of its value, looking at the benefits for the patient, unmet need, therapeutic innovation and benefit to society as a whole.”

Association of the British Pharmaceutical Industry director general Dr Richard Barker said: “As government has said, the priority in any new system must be rapid and consistent patient access to new medicines – value is meaningless without consistent access.

“Any new system must also fairly recognise and reward innovation and investment in research and development. The UK continues to lag behind Europe in the uptake of innovative medicines despite having amongst the lowest prices, so price alone is clearly not the main driver of access in the NHS.

“But we agree fully that the government and the NHS should seek value for money from medicines, and expect NICE to continue to play a key part in the process.”

The Department of Health’s consultation – A new value-based approach to the pricing of branded medicines – ends on 17 March next year.

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