The Department of Health failed to act on expert advice to commission an appraisal of a drug which could lead to savings of £100m for the NHS, it has emerged.

As revealed by HSJ last week, pharmaceutical firm Novartis is seeking a judicial review of a primary care trust cluster’s decision to encourage the use of cancer drug Avastin in the treatment of wet age related macular degeneration, which is around a tenth of the price of the licensed alternative Lucentis - marketed in the UK by Novartis.

In 2010 the National Institute for Healthcare and Clinical Excellence was asked by the Department of Health to conduct a scoping exercise to explore whether there was a need for it to produce guidance on the use of Avastin. NICE does not usually consider recommending unlicensed drugs for use on the NHS but there have been precedents.

A report to the DH recommended there should be an appraisal involving the Medicines Healthcare Regulatory Authority, which licenses drugs, to consider the safety and quality of Avastin, based on evidence from clinical trials and data on its usage.

However, nearly 18 months on the DH has not made a referral to NICE.

A DH spokesman said there were “no immediate plans” for a referral but the position was being kept under review.

He said it would be inappropriate to comment further while legal action was ongoing against the Southampton, Hampshire, Isle of Wight and Portsmouth PCT cluster.

The report to the DH reveals representatives from Roche, which owns the patents for both drugs, told a meeting of stakeholders convened to look into the case for appraisal the company’s decision not to seek a license for Avastin for the treatment of wet AMD was for “corporate reasons”.

Despite this, Association of the British Pharmaceutical Industry chief executive Stephen Whitehead told the association’s annual conference last week he believed Novartis would not lose the case.

Describing the substitution of off label medicines as “dangerous”, he said NICE encouraged the industry to take legal action where the NHS was not following guidelines.

Speaking at the same event NICE chief executive Sir Andrew Dillon said: “The formal position of NICE is that we have not been asked to move to a position where we are evaluating [Avastin for use in wet AMD].

“I understand why individual clinicians have been making that decision and I understand the PCT’s logic but it’s not without risk [to patient safety].”