On 20 January 2022, the National Institute for Health and Care Excellence (NICE) announced major changes to the processes and methods by which it assesses the cost-effectiveness of medicines and other health technologies.

NICE is an independent expert body tasked with appraising the cost-effectiveness of medicines and recommending whether a product should be funded by the National Health Service (NHS).  NICE is therefore considered the gatekeeper for medicines reimbursement; a positive recommendation obliges the NHS to fund a product.

NICE has announced a suite of detailed changes, which mark the culmination of a two-year-plus long “methods review”.  NICE will implement the changes in new guidelines.  They are due to take effect from February 2022.

Some of the new innovations affect the process by which NICE appraises medical technologies.  Perhaps most importantly, they also affect the manner in which NICE reviews submissions and its criteria for issuing positive recommendations.  Many of the changes are technical in nature.

NICE considers these changes “will give patients earlier access to innovative new treatments by allowing greater flexibility over decisions about value for money and consideration of a broader evidence base.”

The following are some headline points we noted:

  • Evolution of a Well-Established Framework. Although the changes are significant, NICE’s fundamental framework remains largely the same.  NICE appraisals will continue to focus on a technology’s incremental cost-effectiveness ratio (ICER) against an existing reference based on the quality-adjusted life year (QALY).  These are established health economic concepts that seek to quantify the relative utilities of a technology.  NICE’s baseline ICER for approving a product will remain broadly the same (e., below £20,000 or £30,000).  These thresholds have remained broadly unchanged for a number of years.  They can prove to be a major hurdle for higher-cost innovative medicines.
  • Flexibility for Disease Severity and Health Inequalities. NICE will have the flexibility to recommend technologies with ICERs higher than its traditional thresholds, depending on disease severity.  Products that treat the most severe diseases might receive a positive recommendation, even if their ICER exceeds the £30,000 upper limit (potentially up to £50,000).  Previously, this flexibility was reserved for end-of-life treatments.  NICE will also have some discretion for treatments that help to reduce health inequalities.
  • New Approaches to Evidence Review. NICE has committed to “enhance and expand upon” how it assesses real-world-evidence submitted as part of a review.  NICE has also given its appraisal committees additional discretion when reviewing products for which it is inherently difficult to generate sufficient clinical evidence (g.,  paediatric indications, rare diseases or complex cases).  NICE’s aim is to “to consider uncertainty appropriately and to manage the risks to patients and the NHS while preventing inappropriate barriers to valuable innovations.
  • Clearer and Potentially More Expansive Approach to Highly Specialized Technologies. NICE has historically maintained a separate review programme for “Highly Specialised Technologies” (often medicines that treat rare diseases that have a heavy disease burden for patients).  Highly Specialized Technologies benefit from far higher ICER thresholds that apply to conventional therapies; reflecting the high-cost of developing rare-disease treatments.  The most recent changes streamline the entry-criteria for the Highly Specialized programme.  In principle, this may allow more products into the programme.  It may also help companies plan better, with clarity over whether a particular product qualifies.
  • Earlier Engagement and More Clarity Promised for Managed and Commercial Access. NICE has for some time had the ability to make interim positive recommendations, to enable companies to gather further data about a product’s cost-effectiveness.  Similarly, NICE may approve a product subject to a “commercial deal” the company has struck with the NHS.  NICE has committed to earlier engagement with the NHS and companies, when these situations arise.  The changes also ought to make it clearer when NICE can make these types of contingent or interim recommendations.  Notably, NICE declined to establish a standalone review system for these situations (which many in the pharmaceutical industry had called for).

It is worth noting that the ambition behind, and trajectory of, these changes go towards clarifying, speeding up and de-cluttering the review of the most promising and innovative technologies.  This ties together with other post-Brexit innovations to improve access to medicines.  These recent innovations include the new Innovative Licensing and Access Pathway (ILAP), which seeks to co-ordinate and streamline marketing authorization and market access reviews for innovative treatments.  They also include the creation of a new NHS Innovative Medicines Fund (IMF) in England.

No doubt, commentators, market access experts and industry will pore over the details of the changes over the coming days and weeks to survey the new landscape for health technology appraisals.

Whether the changes will have their desired effect remains to be seen.  Many of the innovations give appraisal committees more flexibility and discretion.  How committees exercise these new tools will be the critical point; and that will only become clear once we start to see the results of appraisals under the new system.

 

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Photo of Grant Castle Grant Castle

Grant Castle practices in the areas of life sciences regulatory law, with an emphasis on pharmaceutical and medical device regulation. His advice on general regulatory matters includes: adverse event and other reporting obligations, manufacturing controls, labeling and promotion, and product life cycle management.

Grant Castle practices in the areas of life sciences regulatory law, with an emphasis on pharmaceutical and medical device regulation. His advice on general regulatory matters includes: adverse event and other reporting obligations, manufacturing controls, labeling and promotion, and product life cycle management. He has also advised extensively on EC and national laws governing clinical research, data protection, and the regulatory status of borderline products. He has developed considerable expertise in coordinating regulatory projects covering jurisdictions outside of Europe, including Canada, South America, Eastern Europe, the former Soviet Union, Africa, the Near East, Japan, and Australia. His transactional work includes advice on regulatory aspects of mergers and acquisitions, licensing, and collaborative arrangements.

Photo of Brian Kelly Brian Kelly

Brian Kelly is a partner in the London Life Sciences group and also co-chair of Covington’s Global Food Industry Group. Mr. Kelly’s practice focuses on EU food and drug regulatory law, public and administrative proceedings, internal investigations, European Union law, and product liability…

Brian Kelly is a partner in the London Life Sciences group and also co-chair of Covington’s Global Food Industry Group. Mr. Kelly’s practice focuses on EU food and drug regulatory law, public and administrative proceedings, internal investigations, European Union law, and product liability and safety. The Chambers Europe Guide to the legal profession lists Mr. Kelly as part of our “world-class [regulatory and public affairs] team and describes him as a notable practitioner who is “very ambitious, thorough with a sharp intellect”. The Chambers UK Guide quotes clients saying: “his communication and work ethic stand out, he is very hard-working and dedicated when it comes to his cases.”

Mr. Kelly’s advice on general regulatory matters across all sectors includes borderline determinations, food classifications, tissue and stem cell regulation, adverse event and other reporting obligations, manufacturing controls, labeling and promotion, pricing and reimbursement/procurement, product life cycle management (foods and medicines), nanotechnology, and anti-bribery and corruption advice. Mr. Kelly has also been advising on UK and European “Brexit” related issues including tariffs.

Mr. Kelly has also advised and co-ordinated international projects on advertising/promotion, clinical research, data protection, the regulatory status of borderline products, food/cosmetic ingredient reviews and advises on regulatory aspects of corporate/commercial deals, particularly regulatory due diligence.

Mr. Kelly is also experienced in representing clients in administrative and enforcement proceedings before regulatory authorities and in the UK and EU courts.

Mr. Kelly is an honorary lecturer at University College London.

Photo of Raj Gathani Raj Gathani

Supporting clients in the pharmaceutical, healthcare, medical device and consumer products sectors, Raj Gathani’s practice is built around EU and UK regulatory and strategic advice.

Increasingly, Raj concentrates on post market-launch projects, such as advising on advertising compliance, communications, interactions with healthcare professionals…

Supporting clients in the pharmaceutical, healthcare, medical device and consumer products sectors, Raj Gathani’s practice is built around EU and UK regulatory and strategic advice.

Increasingly, Raj concentrates on post market-launch projects, such as advising on advertising compliance, communications, interactions with healthcare professionals and patients, pricing controls and reimbursement strategies particularly in the UK and the Republic of Ireland.

Healthcare, its structure and delivery are specialist practice areas for Raj, particularly having operated healthcare and pharmacy businesses for eight years prior to joining the firm. This experience enables Raj to provide in-depth advice to healthcare clients –particularly those in the digital health space – as well as other life sciences companies whose work engages medical practice, dispensing and health-services rules.