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News - 19 February 2015

NHS medicines priced too high

In a study by the University of York researchers say that the price the NHS in England agrees to pay for new medicines is too high, causing more harm than good overall, an analysis suggests.

They argue the drugs advice body, NICE, has set its price threshold too high.

But NICE says lowering prices could force the NHS to close the door on newer therapies.

Lavinia Newman, Founder of ABDS and a qualified Mediator comments:
The health service has to balance the costs of new treatments alongside investments made in more routine care. To do this the National Institute for Health and Care Excellence (NICE) uses a measure called quality-adjusted life years (QALY). A similar approach is used in Wales and Northern Ireland.

The formula looks at the cost of using a drug for a year and weighs it against how much someone's life can be extended and improved.

At current limits, if a medicine costs more than £20,000 to £30,000 per QALY, it would not generally be recommended as cost-effective.

But researchers at York say the level should be closer to £13,000 to provide the most benefit across the NHS as they argue that with higher priced drugs funds are diverted from areas where it would be more beneficial

A separate pot of money, the cancer drugs fund, does allow for more expensive life-extending medications.

But the report suggests that for every healthy year gained by this fund, five QALYs could be lost across the NHS.

Sir Andrew Dillon, chief executive of NICE, said: "Over the last 16 years, we've achieved a balance between these two extremes that reflects what we believe the public expects the NHS to do."

The research is funded by the National Institute of Health Research and Medical Research Council.
Scotland has a different system for assessing drugs, used by the Scottish Medicines Consortium.

For those who are looking for a more personal approach on a range of business related issues, contact us at ABDS.

ABDS Chartered Certified Accountants of Southampton.
Tel: 023 8083 6900  E-mail: abds@netaccountants.net

Brilliant with numbers   
Great with people  
Clear and precise with advice
Timely and cost effective 
In touch with issues that face our clients and
mindful of their long term strategic goals

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