[Ip-health] The Evidence Gap,Setting a Price on Life

[Riaz K Tayob]

Snip:

It all started with Viagra.

Pfizer's introduction of the drug in 1998 panicked British health
officials, who feared it would wreck the government's health budget. So
they placed restrictions on its use. Pfizer sued, claiming the
government's decision was arbitrary. To defend itself against similar
claims, the government needed a standard method of rationing. The
following year, NICE opened.
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The Evidence Gap
British Balance Benefit vs. Cost of Latest Drugs

By GARDINER HARRIS
Published: December 2, 2008

RUISLIP, England =97 When Bruce Hardy's kidney cancer spread to his lung,
his doctor recommended an expensive new pill from Pfizer. But Mr. Hardy
is British, and the British health authorities refused to buy the
medicine. His wife has been distraught.


---

Bruce and Joy Hardy of Ruislip, England, are awaiting a British agency's
reconsideration of its rejection of a medicine sought by Mr. Hardy, a
kidney cancer patient.
The Evidence Gap
Setting a Price on Life



Dr. Michael Rawlins, the chairman of the agency, the National Institute
for Health and Clinical Excellence.
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"Everybody should be allowed to have as much life as they can," Joy
Hardy said in the couple's modest home outside London.

If the Hardys lived in the United States or just about any European
country other than Britain, Mr. Hardy would most likely get the drug,
although he might have to pay part of the cost. A clinical trial showed
that the pill, called Sutent, delays cancer progression for six months
at an estimated treatment cost of $54,000.

But at that price, Mr. Hardy's life is not worth prolonging, according
to a British government agency, the National Institute for Health and
Clinical Excellence. The institute, known as NICE, has decided that
Britain, except in rare cases, can afford only =A315,000, or about
$22,750, to save six months of a citizen's life.

British authorities, after a storm of protest, are reconsidering their
decision on the cancer drug and others.

For years, Britain was almost alone in using evidence of
cost-effectiveness to decide what to pay for. But skyrocketing prices
for drugs and medical devices have led a growing number of countries to
ask the hardest of questions: How much is life worth? For many, NICE has
the answer.

Top health officials in Austria, Brazil, Colombia and Thailand said in
interviews that NICE now strongly influences their policies.

"All the middle-income countries =97 in Eastern Europe, Central and South
America, the Middle East and all over Asia =97 are aware of NICE and are
thinking about setting up something similar," said Dr. Andreas Seiter, a
senior health specialist at the World Bank.

Even in the United States, rising costs have led some in Congress to
propose an institute that would compare the effectiveness of new medical
technologies, although the proposals so far would not allow for price
considerations. At the present rate of growth, medical costs will
increase to 25 percent of the nation's gross domestic product in 2025
from 16 percent, with half of the increase coming from new drugs and
devices, according to the Congressional Budget Office.

To arrest this trend, the United States needs to adopt at least some of
NICE's methods, said Dr. Mark McClellan and Dr. Sean Tunis, who served
earlier in the Bush administration as, respectively, administrator and
chief medical officer of the Center for Medicare and Medicaid Services.
Dr. Tunis said he spent a lot of time in government "learning about NICE
and trying to adopt the processes and mechanisms they used, and we just
couldn't."

That's because the idea of using price to determine which drugs or
devices Medicare or Medicaid provides has provoked fierce protests. But
Dr. McClellan said the American government would soon have no choice.

Drug and device makers, which once routinely denounced the British for
questioning product prices, have begun quietly slashing prices in
Britain to gain NICE's coveted approval, especially because other
nations are following the institute's lead. Companies have said that
they will consult with NICE to help determine which experimental
compounds enter the final stage of clinical trials, so the British
agency's officials will soon influence which drugs enter the market in
the United States.

The British government created NICE a decade ago to ensure that every
pound spent buys as many years of good-quality life as possible, but the
agency is increasingly rejecting expensive treatments. The denials have
led to debate over what is to blame: company prices or the health
institute's math.

Dr. Michael Rawlins, chairman of NICE, blames the industry, saying that
some companies raise prices "to get profits up so their executives can
get better bonuses." Dr. Karol Sikora, a prominent London oncologist,
said that the institute's math was flawed and that Dr. Rawlins had a
"personal vendetta" against cancer treatments.

Drug company executives who were interviewed uniformly promised to
cooperate with NICE, but industry advocates were not so kind. Robert
Goldberg, vice president of the Center for Medicine in the Public
Interest, an advocacy group financed by drug makers, likened Dr. Rawlins
and his institute to terrorists and said their decisions were morally
indefensible.

Developing a Method

It all started with Viagra.

Pfizer's introduction of the drug in 1998 panicked British health
officials, who feared it would wreck the government's health budget. So
they placed restrictions on its use. Pfizer sued, claiming the
government's decision was arbitrary. To defend itself against similar
claims, the government needed a standard method of rationing. The
following year, NICE opened.

Asked whether he thought the institute would succeed, Frank Dobson, the
Labor health minister at the time, famously said, "Probably not, but
it's worth a bloody good try."

Britain's National Health Service provides 95 percent of the nation's
care from an annual budget, so paying for costly treatments means less
money for, say, sick children. Before NICE, hospitals and clinics often
came to different decisions about which drugs to buy, creating
geographic disparities in care that led to outrage. (Such disparities
are common in the United States, even for federal Medicare patients.)

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