Published: 05/12/2002, Volume112 No. 5834 Page 10 11

If finance directors were hoping for some relief from soaring prescribing costs, they are set for disappointment.Now the national service frameworks are taking their toll, says Alison Moore Prescribing costs are primary care trusts' biggest headaches: after years of growing at around 8 per cent a year, they increased by 11 per cent last year and this year an even larger jump is expected.

But what is driving this increase - and are there any signs of relief for hard-pressed finance directors? The Prescription Pricing Authority highlighted a number of factors in its recent annual report. It expects an increase in the number of prescriptions written of around 6-7 per cent a year - but the average cost of prescriptions is also continuing to increase.

These two factors have led to a doubling in the drugs bill from around£3bn in 1992-93 to around£6bn last year with the number of prescriptions written growing from 400 million to 550 million and the average price increasing from£7.69 to£10.83 (not adjusted for inflation).

The PPA highlights the influence of national service frameworks, especially the one for coronary heart disease which led to an 11.7 per cent increase in the volume of cardiovascular drugs prescribed over the last year.

Other frameworks appear to have had an effect on individual areas - a 13.3 per cent increase in volume for diabetes drugs and a whopping 41.8 per cent increase in those for bone metabolism.

The PPA's latest figures suggest that this year's increases could be even bigger: both volume and cost increased significantly in the months between April and September, and in June the net ingredient cost was increasing at a rate of over 12 per cent per annum.

Darlington primary care trust chief executive Colin Morris suggests that the increase is really down to 'good quality prescribing' as GPs increasingly prescribe appropriate drugs to the patients for whom they are clinically indicated.His trust is anticipating a£1m overspend on its£12m drugs budget this year.

Other PCTs are in similar positions. South Gloucestershire PCT is facing an overspend of£650,000 on a£23m budget - despite raising prescribing budgets by 11 per cent this year.

Its professional executive committee chair, Dr Phil Yates, points to significant reductions in deaths from heart disease and strokes as evidence of the effectiveness of prescribing - but adds that those patients who now survive still need drug treatment, and may also need care in the secondary sector. Good news for patients:

bad news for PCT finances.

Both Surrey and Sussex and Kent and Medway strategic health authorities have said that rising prescribing costs have contributed to current financial difficulties in their local health economies. East Kent was one of the first areas to encourage vigorously good quality prescribing and saw its prescribing costs increase earlier than other areas as a result.

But even now costs are still going up and the PCTs are struggling to balance their budgets.

'We are now seeing a significant overspend...we have real problems now in continuing to implement clinical effectiveness, ' says Dr Tony Snell, medical adviser to four PCTs in the area. 'The PCTs are caught between a rock and a hard place.'

And the financial pressures are set to intensify. The full force of recommendations from the National Institute for Clinical Excellence has yet to hit the NHS's drugs bill. The PPA says it is 'not yet a major driver of prescribing volume or cost'.

The Association of the British Pharmaceutical Industry agrees, suggesting that although there have been increases in the prescribing of new drugs postNICE, this is only in line with what would be expected with any new drug.

However, NICE's own estimates put the cost of its recommendations at around£570m a year if they were adopted throughout the NHS. The biggest cost increases are around atypical antipsychotics, and drugs for rheumatoid arthritis, hepatitis C and Alzheimer's disease.

Some NICE judgements have yet to take full effect - the decision on nicotine replacement therapy made in the early months of this year is likely to add 500,000 to 1.4 million prescriptions a year to the NHS bill, for example. The cost could be up to£59m a year.

And NICE looks at the global cost-effectiveness of a drug, not just its prescribing cost. This means that savings may result in secondary care while increases in costs occur in primary care. For example, some of the new schizophrenia drugs which have been approved by NICE are dearer than their older counterparts but reduce inpatient stays. Overall they offer considerable cost savings to the NHS, but they will increase spending on drugs.NICE was due to issue its guidance on treatment of schizophrenia - including the use of antipsychotics - yesterday.

Could generics be the salvation of the NHS? Although there will be cost savings as patents expire and different types of drugs become available generically, potential savings by switching to existing generic drugs seem limited.

Generic prescribing in the UK is already higher than most places in Europe at 74 per cent of prescriptions written generically, and 52 per cent dispensed generically.

Some PCTs say their scope for making more savings is limited until more drugs come off patent.

Christine Macrae, director of prescribing and medicines management at Broadland PCT in Norfolk, recently said that there was only another£31,000 a year to be squeezed out of generic prescribing in her PCT.

In East Kent, where generic prescribing is above 75 per cent, Dr Snell says a lot of the fat has already been cut from prescribing.

'There comes a point at which the percentage of generics can't be pushed up any higher safely, ' says Dr Yates, who is also the NHS Alliance's spokesman on prescribing.

However, he does expect statin prices to fall as the early statins become available generically and other manufacturers drop prices to maintain their market share. The British Generic Manufacturers Association says the average cost of a generic in England is£3.52, compared with£17.38 for an 'originator' drug.

The maximum price system for some generics - which was brought in two years ago when generics' costs soared and availability dropped dramatically - is under review. Whatever new system emerges may have knockon effects on drugs budgets.

But as Mr Morris points out: 'For every drug that comes off patent and we get a better deal, there will be another three drugs that will be NICE-appraised and we will be forced to prescribe.'

The proposed new general medical services contract for GPs could add more pressures to drugs budgets. The quality indicators which will determine whether GPs get more money could drive 'good quality' prescribing.

Tackling the increasing drug budget requires a multi-faceted approach. Mr Morris argues that the public has to be involved - 'I do not think it understands the impact of almost persuading its GPs to prescribe. People going along with digestive difficulties after drinking all night and ending up with a 3am curry are asking for high cost remedies when they should just modify their lifestyle.'

Much work has been done in persuading GPs to change their prescribing habits, but there may still be some scope for improvement. Darlington PCT is hoping to introduce new software which will alert the GP to alternatives as they are in the process of writing a prescription. 'It sounds small beer, but we think we can identify between£300,000 and£500,000 savings provided GPs prescribe in this way, ' says Mr Morris.

Working with pharmacists to improve repeat prescribing may also be a fruitful area, suggests Dr Yates.Many PCTs are working with acute trusts - where much prescribing is initiated - to draw up joint formularies which will exclude some high-cost but limited effectiveness drugs, Dr Yates says.

'Even if we know that a drug has some effect it may still be better not to have it within a formulary because the value for money may not be as high as with other drugs, ' he says. Not surprisingly, some clinicians feel this impacts on their freedom.

So there is little respite in sight for drugs budgets. Sadly, even prescribing cost-effectiveness drugs to appropriate patients has an 'opportunity cost' in terms of other services that can't be developed.

South Gloucestershire has had to shelve a retina-screening programme for diabetics which could prevent blindness because of pressure on costs. Ironically, the diabetes framework backs such screening and it will have to be reintroduced. But as Dr Yates, points out, something else will have to go instead.