Briefing Meeting: 'The Changing HNS: A Guide to the New NHS and What Does a Health Technology Appraisal Mean?'

The latest PM Society Briefing Meeting, held on 27th February at Innovex, was attended by 70 delegates keen to learn more about the changes taking place in the NHS.

Steve Mackenzie-Lawrie, vice-chairman of the PM Society, introduced the meeting which is the first in a series of three focusing on giving practical advice and information on different aspects of the changing NHS.


Programme for 2007
Gail Rowe, one of the members of the Society's briefing meetings committee, then went on to explain that the committee had decided on the topics for 2007 following an email survey to members asking what they wanted to see and from the response it was evident that the implications of the changing NHS were a high priority. With this in mind, the next meeting will take place on 22 May where 'Practice-Based Commissioning' will be explained by speakers from the NHS and industry. This will be followed in June with 'Payment by Results' when an eminent pharmacist and industry expert will tell us what this means to pharmaceutical marketers and how we can promote it. In September we will be 'Investigating New Prescribers', such as nurses and pharmacists, and looking at the new opportunities they present us.

As pharmaceutical marketers we have a huge challenge ahead in keeping up to date with the changes in the NHS and learning how to tailor our programmes to take into account the wider audience now available to us. So, we hope this series of briefing meetings will provide key information and the opportunity for anyone attending to ask questions of experts in their field.


A PRACTICAL GUIDE TO THE NEW NHS
David Southern, Senior Brand Manager - NHS Marketing at Napp Pharmaceuticals and member of the PM Society committee, demonstrated how the market has changed and what our response as an industry should be.

In the 1940s an economist, Joseph Schumpeter coined the term 'creative destruction' which was used to describe how new technology or innovative process in the market place can completely eradicate old technologies or systems. For example, during late 1800s tall ships such as the extreme tea clipper Cutty Sark were successfully used to ship tea fairly speedily from India to London. However, when the steamship was introduced these state of the art tall ships suddenly became completely obsolete. Although we will only be sure with hindsight it could be argued that we are in a period of 'creative destruction' now where changes that are happening within the NHS are radically changing the way we should respond to the market.

Data show that more of us are living beyond the age of 65 and that life expectancy over 65 is increasing - in short, more of us are living longer. This is a fundamental that cannot change and is putting more pressure on the NHS with 80% of the NHS spend going on the over 65s. No advanced economy can afford this which is why changes are being made in the NHS and why changes must be made in the market place.

The NHS in financial crisis -

• the spend for 2007/2008 will be in real terms 40% higher than five years earlier
• the overspend by NHS trusts in 2005/2006 was £1.2 billion and £500 million by the NHS as a whole
• This year they will claim to be on target but David suggested that their figures could be dubious!

Four reasons for financial crisis (Kings Fund 2006)

• Failure to anticipate and manage rapid growth in demand - especially emergency admissions
• Rapid cost inflation - especially pay and drugs
• Decline in productivity across the NHS
• Policy levers - especially 'demand management' are weak

David emphasised that 'demand management' is a key issue in the changes

The Government's response
The amount of policy, information and legislation being generated is mind boggling, not just for us but also for those working in the NHS who are struggling to keep up with the changes. We can however hone them down to four fundamental reforms:

• Transaction reforms (payment by results)
• System management reforms (clinical government)
• Supply side reforms (the introduction of private providers, foundation trusts etc)
• Demand side reforms (practice-based commissioning)

It is reasonable to refine this further to three essential pieces of policy.

• Practice based commissioning - it widely accepted that without strong commissioning the current changes will fail.
• Payment by results - allows for a 'level playing field' encouraging suppliers to concentrate on efficiency and quality. It also allows for alternative suppliers to smoothly enter the market
• Choose and Book - this is still controversial as it is still far from perfect and patchy in its uptake. However it should be the mechanism by which plurality of provision will work

David simplified this further still using a model used by Bob Webb, a commissioner in Ipswich, who looks at the following three key factors when considering new drugs

• Experience - will it improve the patients' experience?
• Efficiency - will it make the NHS more efficient?
• Cost - will it cost the NHS more or save it money?

If we concentrate on quality and value in our approach to the NHS it will improve our chances of success.

Pharma's response

As in the Cold War when Khrushchev and Kennedy increased their Nuclear power supplies, so pharma has built up its sales force to enormous sizes. However this is now changing as the industry has come under pressure to reduce overheads. The most recent example being the recent OFT report accusing the industry of charging £500 million too much for our drugs.

To gain market access we now need to address the Health Technology Appraisal (HTA), something we are getting better at as all new products must be submitted to the Scottish Medicines Consortium (SMC) for approval at launch. As a result of this we are also improving our Budget impact modelling by looking at what impact this new technology will have on PCTs etc. But the area we need to improve now is Service redesign if we want to release resources from the NHS to introduce new technology - we need to look carefully at how the NHS are redesigning their services and how we can help the NHS become more efficient. The NHS is a huge organisation of 1.3 million people but it is not used to driving efficiency through the system. We therefore need to look at how we can assist the service redesign.

Partnerships
David used a 'beer' analogy to show how strategic partnerships could be a useful new approach for the pharmaceutical industry and inspire us to think how we can approach our customers differently. Guinness approached Carlsberg, traditionally one of their biggest competitors, to form a strategic alliance for a new opportunity. They took it to a distributor who brought in other partners which resulted in a 40% market share - this success would not have been possible had they made the approach separately. However, a word of warning, 70% of partnerships fail so it is therefore vital that we get it right and think very carefully about who we choose to partner with to maintain our reputation,

Partnerships can broaden our scope and power and link us in the mutually beneficial aim to drive towards creating a more efficient service - as long as the suppliers we choose to work with have the same ideals. It is important to the NHS as it will enable them to release resource and spend more money on new technology. The NHS would also be happy about dealing with a partnership as they get nervous about dealing with just one company. It may not be the way forward for everything but it may be a step on the way to a new solution for pharmaceutical companies. What is important is that we partner the NHS much more closely.

Benefits of a partnership to pharma
If we get it right we can lead change and design the market we are working in. We also increase turnover by driving more patients through the system. We get additional resource from other suppliers and insight into product development and gain an advantage by becoming highly valued strategic partners.

Benefits of a partnership to the NHS
The NHS would benefit from working with a partnership by learning business skills. The NHS is process driven and does not have the people skills and business skills that pharma have. Both the NHS and patients would benefit from more efficient use of existing resources.

This approach is more targeted and takes us away from the 'shoe leather' approach of simply getting more sales people out there. If we don't change then we could end up like the Cutty Sark!

Discussion
How do you set up a partnership without being accused of starting a cartel?
As long as the partners are sufficiently different, eg not two statins, there can be no objections.

The key to partnering is trust - is the NHS ready to trust the industry and what can we do to build trust?
They may not ready to trust us with our existing approach, however if we approach the NHS on their terms with solutions that need we may be able to encourage a different response.



Health Technology Assessment in the UK

Jonathan Belsey has been a GP, a Health Authority commissioner and pharmaceutical advisor but now works for JB Medical Ltd where, among other interesting projects, he prepares submissions for SMC.

Jonathan started by pointing out that the influence of commissioners is now much greater than it was in his day as a commissioner and that it is critical that we get in touch with them. Although the role of the rep in talking to prescribers is diminishing, their role in communicating with these people is increasing as commissioners are often ill-informed in understanding clinical issues.

There are four key HTA organisations in the UK and it is crucially important that we understand the issues around each one. The first of which is:

1. National Institute for Health and Clinical Excellence (NICE)
   
   • Health Technology Appraisals (HTA)
   • Interventional procedures - now straying into the surgeons' territory too
   • Clinical Guidelines - eg treatment of depression
   • Public Health Guidance eg childhood obesity, smoking cessation
     
     NICE is a relatively new body that came into effect in April 2000 and has made a huge impact on controlling the use of health technologies in the NHS. Its earlier guidelines had very little impact on clinical practice but it is now seen as the 'word of God; so ignore it at your peril!
     
     NICE guidance is slow with an HTA typically taking 18 to 30 months, not quick, short, sharp guidance. They are intending to issue rapid assessments but these will target life saving treatments only and will not affect the vast majority of UK product launches. The first of these that we saw was the Herceptin assessment which came out in August last year. Herceptin had been licensed for use in end-phase breast cancer but not early-stage cancer. They presented results of a study saying there was value in early-stage breast cancer - the data was statistically significant and looked effective - and this triggered high profile cases of women understandably wanting the drug. Political pressure pushed Herceptin to the top once it was licensed and it was then appraised by NICE in the normal way. The final decision is not influenced by politics but what gets there and how quickly it gets there may well be.
     
     NICE will look at submissions according to its specific framework and will make no attempt to see how it fits into a priority list or how it is going to fit into a budgetary framework and its decisions can therefore cause conflict. NICE doesn't appraise unlicensed drugs. It has a very rigid framework and once guidance is issued, it needs to be implemented within three months.
     
     
     
2. Scottish Medicines Consortium (SMC)
   
   • Functions as an Über-D&T committee - it has set itself the target of reviewing every new pharmaceutical that is launched into Scotland. Although it only has authority in Scotland, PCTs in England and Wales are increasingly looking to SMC for clinical guidance.
   • It looks at single drug appraisals whereas NICE tends to look at drug class appraisals
   • It expects a submission within 12 weeks of launch after UK licensing
   • You will receive a judgement within a further 12 weeks
   • It is gradually working its way through existing licensed products and will provide guidance on whether products can be used freely, in restricted groups of patients or not at all.
   • Importantly, in the absence of a company submission a negative judgement will be given
     
   
   
3. AWMSG
   
   • Functions like SMC but does not look at all drugs
   • Limits remit to:
     • Drugs costing >£2000 per patient per year
     • Drugs + indirect costs > £2000 per patient per year
     • Potentially very high volume drugs
   
   It is currently restructuring and we are likely to know more when it is relaunched in May of this year. An AWMSG submission is identical to an SMC submission
   
   
4. CREST
   
   • Undergoing restructure
     
   • Has tended to focus on guidelines development
     
   • From April 2007 it will officially be the Northern Ireland implementation arm of NICE guidance
     

What you need to do
You need to look at clinical trials now if you have a new launch in quarter four. You will need to put together a Health economic analysis and assess the financial impact overall. The Health economic analysis is the most important part of the submission and is set against an independent health economic analysis and is assessed rigorously - it needs to prove that your product is cost effective versus current standard treatment ie show £30,000 per qualy (which is the same figure used since 2000 and is therefore getting increasingly difficult to achieve as we have had 4-5% per year health service inflation). Clinician opinion matters, although it will not make or break a submission, and can sometimes help focus efforts and offer support with co-ordinated activity.

Key issues
When your turn comes, you need to:

• Read the instructions ... carefully!
• Be honest - look at the studies you have
• Co-ordinate sections and ensure there is a consistent tone to your document
• Seek external opinion - this can make a big difference
• Involve patient groups and physicians
• Devote serious money and time - if you don't have the resources internally, buy in help if necessary

In summary, you need solid data, a decent product and a good health economic analysis to stand a decent chance of getting a NICE approval.

Questions
Who chooses what is nominated for NICE appraisal?
Anyone can nominate a subject to be looked at by NICE. All products, once approved for appraisal, will undergo the same procedures - NICE is a very inflexible body which means that although everything follows the same system, it makes it hard to sway any decisions that are made. The SMC are a little more human and discussions with them can be held regarding submissions.

How much does a NICE Health Technology Assessment cost?
NICE and SMC do not charge to make a submission. If you plan to use an agency to prepare your submission, SMC tends to be cheaper - around £40-£60K - whereas NICE will cost around £70-£100K

Do SMC and NICE influence guidance outside the UK?
Absolutely, European countries including Germany, Denmark and Holland look to NICE and SMC. It is thought that the Germans may adopt SMC formally.

How many NICE people are there?
There are only about 6 permanent staff. For each appraisal they appoint an assessment committee of 20-30 people who are working in the field and have an interest. They will also nominate an academic centre by tender who will be commissioned to carry out a literature review and produce an independent economic model. When all the submissions are in from the industry, professional and voluntary sectors, they are read and edited into a single document which is combined with the academic assessment and then put to the committee.




We would like to thank our speakers, David and Jonathan, and reiterate our thanks to Innovex for hosting the briefing and providing a delicious buffet for delegates.

Held on: 27/02/2007