Health commissioners will soon be able to enter into US-style package deals with pharmaceutical companies to tackle a range of conditions including asthma, diabetes and heart disease.

NHS managers say a draft health service circular on commercial sponsorship and ethical standards in the NHS will allow primary care groups to sign disease management packages with the pharmaceutical industry.

Existing guidance in the form of an executive letter outlaws disease management packages, where one company has a monopoly on supply of a drug or treatment.

The circular, currently out for consultation, lists banned funding and sponsorship options but omits any mention of disease management deals.

Dr Tony Snell, medical adviser and deputy director of performance management at East Kent health authority, said he, along with other NHS managers and the pharmaceutical industry, interpreted the circular as a green

light to enter into disease management packages.

And he predicted that primary care trusts would develop relationships with drug companies along the lines of the US not-for-profit health management organisation Kaiser Permanente, which has been accused of limiting treatment options.

East Kent HA has already developed its own code of practice for 'joint ventures' which sets strict provisos of patient confidentiality, accountability, monitoring and value for money.

Speaking at a conference on drug industry partnerships with the NHS, Dr Snell said: 'This government seems prepared and willing to look at new and innovative ways of joint working.'

Dr Snell said PCGs or successor PCTs may have to consider such deals to comply with national service frameworks, stay within the parameters set by the National Institute for Clinical Excellence and Commission for Health Improvement and head off drug overspends.

'There is a huge change agenda on offer and I don't believe that the NHS has the resources, cash or the skills to deal with the changing management process or the mind-set of clinicians.'

He forecast hostility to the deal from doctors and social services representatives on PCGs. 'There is a lot of baggage and mistrust about the pharmaceutical industry - there has been a history of dubious claims and there have been good examples of how not to launch and market products when the evidence base is not satisfactory.'

Stephen Young, chief executive of Chiltern PCG, said some PCGs already had£1m-plus drug overspends. He wanted partnerships with the drug industry to develop disease protocols and frameworks, and help with needs assessment and audit. He also wanted staff secondments to keep costs down and address national and local policy.

But he was concerned at aspects of the pharmaceutical industry approach to the NHS. He said some PCGs had made it clear they would have nothing to do with private sector deals.

The Association of the British Pharmaceutical Industry said it wanted to see a more radical approach to NHS partnerships. In response to the draft circular the ABPI says it is 'overly conservative' and 'could well prevent potentially beneficial partnerships'.