Select Committee on Health First Report

2  Background

9. When NICE was first established its role was:

to appraise the clinical benefits and the costs of those interventions notified by the Secretary of State and the National Assembly for Wales and to make recommendations.[7]

NICE initially appraised medical technologies (mainly medicines) and developed clinical guidelines. Shortly after its establishment, its remit was expanded to include interventional procedures. Since 2004, NICE has also examined public health approaches. In 2005, it changed its name from the National Institute for Clinical Excellence to the National Institute for Health and Clinical Excellence to reflect its new remit.

10. In this chapter we look at:

  • What NICE does and how it works;
  • International comparisons;
  • Developments since 1999; and
  • Successes, criticisms and future challenges.[8]

The remit of NICE and how it works

11. NICE produces several types of guidance:

As of December 2007, NICE had published 133 technology appraisals, 248 interventional procedure appraisals, 65 clinical guidelines and seven pieces of public health guidance.

These different types of guidance, and the processes involved in their development, are described below.


12. Health technology appraisals include assessments of medicines, devices (such as pacemakers and inhalers for asthma), surgical procedures and other interventions. The initial selection of health technologies for consideration by NICE involves both the Institute and the Department of Health. Prior to September 2006, the Department referred topics directly to NICE; now possible topics are forwarded by the National Horizon Scanning Centre at the University of Birmingham to the Institute's seven new Consideration Panels. These panels, which are divided by therapeutic area, perform an early 'sifting' of the topics. The sifted topics are then referred to the Department of Health for final selection.[9]

13. NICE has mainly examined new interventions to date. However, as the Committee recommended in its first report on NICE, the Institute has now started to evaluate older treatments in order to encourage disinvestment by primary care trusts (PCTs) in treatments that are likely to be ineffective.[10]

Technology appraisals (of medicines)

14. The technology appraisal process is described in the box below.
NICE technology appraisal process

1. Consultees and commentators are identified. These may include national organisations, such as professional and research bodies, manufacturers, patient groups and those representing carers;

2. A scoping document is prepared, setting out what the appraisal will cover. Consultees and commentators may comment at this point;

3. NICE commissions an independent academic centre to review the available evidence on the technology in question and prepare an assessment report. Consultees and commentators may comment at this point.

4. An evaluation report is prepared. The assessment report and comments on it are brought together in the evaluation report;

5. An independent Appraisal Committee[11] considers the evaluation report and hears evidence from nominated groups, including the manufacturer. It then makes its first recommendations in the appraisal consultation document (ACD). Consultees and commentators have four weeks to comment on the ACD. The ACD is also made available online and is open to public comment;

6. The Appraisal Committee considers the comments on the ACD, then makes its final recommendations in the final appraisal determination (FAD). The FAD is submitted to NICE for approval. Consultees can appeal against the recommendations.

7. Guidance is issued. If there are no appeals, or an appeal is not upheld, the final recommendations are issued as NICE guidance.

Note: NICE's technology appraisal methodology is being reviewed. A draft 'Guide to the methods of Technology Appraisal' is now open for public consultation.

Box 1.

Single technology appraisals and multiple technology appraisals

15. Technology appraisals are divided into single technology appraisals (STAs) and multiple technology appraisals (MTAs).

16. The STA process was introduced in September 2005. This procedure is used to assess a single product for a particular condition. An STA should be completed within 9-12 months. According to NICE, if the technology is a new medicine and the process starts around the time the manufacturer requests marketing authorisation, and there is no appeal, it should issue guidance on use of the treatment within the NHS within three months of the drug obtaining a licence.

17. An MTA compares several different types of treatment for the same condition, and so the guidance is longer and more detailed. An MTA should be completed within 24 months.

18. The funding of products recommended by technology appraisals is mandatory; if the treatment covered by a health technology appraisal is requested by a clinician, the PCT or trust must be in a position to fund it within three months of the guidance being published.

NICE's recommendations

19. NICE technology appraisals to date have been fairly evenly spread between wholly negative, wholly positive and positive with major or minor restrictions. Its decisions between 1999 and 2005 were:

  • negative (a 'no' decision) in 19% of cases;
  • positive ('yes') in 23% of appraisals;
  • 'yes with major restrictions' in 32% of cases; and
  • 'yes with minor restrictions' 26% of cases.[12]

20. NICE may recommend that a technology is used 'only in research', which means that the treatment is available from the NHS but only as part of a controlled clinical trial. This option is rarely used, and some believe that a recommendation of 'only in research' is equivalent to a rejection of the product or approach.[13] However, there are occasions when a recommendation that a technology be used only in research has been followed up with effective testing and led to eventual approval of the technology by NICE. For example, liquid cytology for cervical cancer screening was recommended only in research by NICE in 2000. Pilot studies and subsequent review led to a positive recommendation of the technology by the Institute in 2003.[14]

Interventional procedures

21. NICE guidance on interventional procedures may include diagnostic tests or procedures that involve accessing the inside of the body. Examples of interventional procedure guidance issued by NICE include Deep brain stimulation for Parkinson's disease and Customised titanium implants for orofacial reconstruction.

22. The steps involved in the appraisal of interventional procedures are similar to those included in appraisal of medicines, in that consultation takes place before guidance is issued, and stakeholders may challenge draft guidance. There are differences in the means of topic selection, however, in that procedures suitable for evaluation are suggested by the public (usually by a clinician). The full process is described in the Annex.


23. Clinical guidelines advise on the appropriate treatment and care of patients with specific conditions. Their implementation is not mandatory. NICE often works with external professional bodies and academic centres, via its National Collaborating Centres (NCCs), to compile this type of guidance. The process of clinical guideline development is described in the Annex.

24. Clinical guidelines take around 24 months to produce. These guidelines are long and detailed and changes are underway to produce a greater number of shorter guidelines on narrower areas. Such guidelines address areas where there is a particular clinical question, but not the need for a full-scale guideline. A short guideline is produced in 9-11 months.


25. Public health guidance provides indications of how good health can be promoted and ill health avoided. It is aimed at those working in the NHS, local authorities and the voluntary sector as well as the general public.

26. NICE produces two types of guidance on public health. The first, public health intervention guidance, focuses on specific interventions that encourage a healthy lifestyle. Published intervention guidance includes Smoking cessation and Preventing sexually transmitted infections and reducing under-18 conceptions.

27. The second type of public health guidance developed by NICE is public health programme guidance. This provides broader advice on promoting health and avoiding ill health. It may focus on a population, activity or setting. Published topics of public health programme guidance include Behaviour change, which set out the planning, tools and types of skill needed in order to change health-related behaviour. Programme guidance currently being developed includes Alcohol use disorders in adults and adolescents, which covers issues relating to prevention and early identification of alcohol use disorders, and Community engagement, which is an assessment of development approaches to improving health and reducing health inequalities, such as the use of citizens panels and juries, and community champions. The process of public health guidance development is described in the Annex.


28. All the processes described above require the evaluation of the information available on the drug, intervention, procedure, approach or condition in question. This information may be limited or flawed. Therefore the Institute must make "social and scientific value judgements" in relation to the evidence.[15] Social value judgements concern the principles involved in the care and treatment of patients by the NHS; scientific value judgements concern how the available evidence is interpreted.

29. NICE, in collaboration with its Citizens Council[16], defined a series of social value judgements that should be considered during the development of guidance. Key principles include:

  • The need for consistency in the guidance development process;
  • NICE should not recommend interventions when the evidence base is weak;
  • The need to look beyond cost per quality-adjusted life year (QALY, see Chapter 3) when considering cost-effectiveness;
  • Discrimination between different groups of patients on the basis of age or any other factor should be avoided, unless there is clinical evidence of a difference in the effect of treatment in such groups (eg. a treatment may only be effective in patients in a certain age range, or with a specific gene);
  • NICE should respond to comments from stakeholders and consultees and amend guidance where necessary.[17]

Departures from these principles should be explained.

30. Scientific value judgements require an assessment of the type and quality of evidence presented as well as the results of the various analyses. These factors contribute to decisions relating to the cost effectiveness of a treatment or intervention. NICE makes great use of QALYs when judging cost effectiveness. The technical processes involved in NICE evaluations are discussed in the next chapter.


31. NICE decisions may be appealed by a range of stakeholders, including manufacturers and patient or professional organisations. By November 2007, NICE had published 130 technology appraisals, 47 of which had been appealed. When appeals are upheld, often only small changes to the wording are required. See the table below for the numbers of appeals that were upheld or rejected in every year since the establishment of NICE. We describe the appeals process in more detail in Chapter 3.


appraisals published

Appeals submitted Appeals allowed (withdrawn or dismissed without hearing) Appeals upheld after hearing Appeals dismissed after hearing
200017 88(0) 26
200114 54(1) 13
200224 1110(1) 73
200319 44(0) 13
200413 52(3) 11
20056 33(0) 03
200620 66(0) 33
200717 55(0) 41
Total130 4742(5) 1923
Table 1.

International comparisons

32. Many organisations concerned with the evaluation of medicines and other health interventions exist elsewhere. The Committee visited Scotland, France and Canada to learn about the arrangements in place in those countries.


33. NICE guidance applies in England, and much of its guidance also applies in Wales and Northern Ireland. Although some NICE guidance applies in Scotland (such as that relating to interventional procedures), the Scottish Executive has established its own arrangements for the assessment of medicines (equivalent to NICE technology appraisals) through the Scottish Medicines Consortium (SMC). Advice on clinical practice (equivalent to clinical guidelines) is produced by the Scottish Intercollegiate Guidelines Network (SIGN).

Scottish Medicines Consortium

34. The SMC assesses and makes recommendations on all new drugs. That is, it provides advice to NHS Boards and their Area Drug and Therapeutics Committees across Scotland about:

35. Unlike NICE health technology appraisals, SMC recommendations are not mandatory. The following classification system is used:

36. In comparison with NICE technology appraisals, less in-depth analysis informs SMC decisions. There are no published processes and methods to which SMC must adhere. It has no scoping phase and public consultation is limited. The whole process is swifter, lasting around 4 months.[19]

37. The pharmaceutical industry is represented on the committee that evaluates the drug. There is more dialogue between the Consortium and the manufacturer throughout the SMC process compared to that of NICE. Perhaps for this reason, appeals are rare. When they do occur, SMC will review a decision on the basis of process or scientific issues.

Scottish Intercollegiate Guidelines Network

38. SIGN develops national guidelines for use by clinicians working within NHS Scotland. Like NICE clinical guidelines, they are not mandatory. Guidelines take between 24 and 30 months to compile.

39. Topics are selected on the basis of clinical uncertainty, strength of the evidence of treatment efficacy, risk, priority for NHS Scotland and perceived need. Anyone can propose topics for consideration by SIGN. Topics are sent to one of a number of speciality subgroups, overseen by the Guideline Programme Advisory Group. SIGN Council, which comprises representatives from medicine, nursing, healthcare management, research, social care and patient groups, makes the final topic selection.

40. SIGN guidelines are then developed by multidisciplinary working groups, which include healthcare professionals, NHS managers, researchers and patients. The guideline development groups are selected in consultation with the member organisations of SIGN.

41. There is no formalised relationship between SMC and SIGN.


42. In France, the French Haute Autorité de la Santé (HAS) is an independent body that provides medical and scientific advice to the French Government. Much of its remit mirrors that of NICE including:

  • The production of health technology assessments;
  • The production and promotion of clinical guidelines;
  • The provision of public health guidance.

43. HAS assesses more technologies than NICE and performs its assessments more quickly; as a result, its assessments tend to be based on less evidence than those of NICE. See the box below for details of the HAS appraisal process.
HAS technology appraisal process

HAS has two types of health technology assessments: a full-scale assessment and a rapid assessment. Topics covered by the full-scale assessment are broader than those covered by NICE technology appraisals. In addition to evaluating pharmaceutical products and medical devices, it assesses areas such as screening programmes, diagnostic procedures, the distribution and replacement of medical equipment, medical research and changes in the legislative framework.

The rapid assessment programme evaluates the benefit of medicines, devices, diagnostic techniques and therapeutic procedures and advises on whether they should be reimbursed by the French healthcare system. This work is done by the Committee for the Assessment of Medical Devices (CEPP) for devices and the National Agency for Accreditation and Evaluation in Healthcare (CEAP) for diagnostics and therapeutic procedures. The Transparency Commission provides this service for medicines.

The Transparency Commission assesses all new medicines, once licensed, that are subject to applications for reimbursement by the state. Its opinion is used to assess the benefit provided by a new drug and the improvement of a medical service subsequent to its use. External experts assist the Commission in its work. HAS assesses the stand-alone effectiveness of each technology, as well as its effectiveness in comparison with other available technologies (ie. the absolute and comparative clinical effectiveness of the drug). Unlike NICE the Transparency Commission assesses a medicine before its price has been set.

Recommendations from all three groups are passed on to the Economic Committee for Health Products (CEPS), which negotiates with industry to fix the price of drugs and devices. A further body, the Association of National Health Insurance Funds, which fixes the reimbursement rate for medicines and sets tariffs for procedures, also receives advice from the Transparency Commission, CEPP and CEAP.

The Ministry of Health makes the final decision regarding the drugs and devices that will be reimbursed by the state. A product cannot be launched in France until it has gone through the Transparency Commission and a price is agreed by CEPP.

In 2006, HAS carried out nine full-scale health technology appraisals, 1,192 rapid appraisals of medicines, 134 of medical devices, and 130 of diagnostic and therapeutic procedures.

Box 2.

44. In addition to technology appraisals, HAS is involved in the development of disease management programmes for chronic conditions, the promotion of medical information and products, such as prescription software, and ensuring the quality of information provided by, for example, medical sales representatives. HAS also advises drug companies on the protocols used for post-marketing clinical trials, and validates these protocols.

45. HAS is responsible for accrediting both healthcare organisations and individual clinicians and continuing professional development. As a result, it is able to monitor the uptake of its recommendations.


46. The Canadian equivalent of NICE is the Canadian Agency for Drugs and Technologies in Health (CADTH). CADTH advice applies in all the provinces and territories of Canada except Quebec.

47. CADTH has three core programmes:

  • the Common Drug Review (CDR), which assesses new drugs;[20]
  • the Health Technology Assessment, which conducts wider assessments of drugs and other health technologies;
  • the Canadian Optimal Medication Prescribing and Utilization Service (COMPUS), which identifies and promotes best practices in drug prescribing and use.

48. The CDR was established in 2003 by federal, provincial and territorial Health Ministers to avoid duplication of drug reviews by public drug plans, improve the quality and consistency of the review processes; and address the differences in drug coverage among the publicly funded drug plans.

49. The CADTH Health Technology Assessment programme takes a broader look than the CDR at areas of healthcare, or drug classes, and is more closely comparable to NICE's multiple technology appraisals or its clinical guidelines. The programme aims to provide information about the clinical effectiveness, cost-effectiveness, and wider impact of drugs, medical technologies, and health systems. Recent topics examined include Technologies for Aiding Reduction of Medication Errors in Hospitals, Telemedicine for Acute Stroke Management (Telestroke), and Procedural Sedation in the Emergency Department.

50. The COMPUS programme was created in 2004. It identifies and promotes evidence-based, clinical and cost-effectiveness information on optimal drug prescribing and use. For each priority topic, it produces a series of optimal therapy reports, aimed at policy-makers, provincial drug plans, prescribers and patients. It also provides strategies, tools, and services to encourage the use of evidence-based clinical and cost-effectiveness information in decision-making among healthcare providers and consumers.

51. The CDR and Health Technology Assessment relate most closely to NICE's health technology appraisal processes. See the box below for more details. COMPUS is not directly comparable to any of the programmes run by NICE, although similar types of information are included in NICE's evaluation of treatments and in its guidance.

CADTH technology appraisal processes


Once Health Canada has approved a drug for sale in Canada, the drug must be submitted to the CDR if the manufacturer wishes to obtain coverage under any of Canada's public drug plans (with the exception of Quebec). The CDR process is as follows:

1. A drug is submitted by CADTH's Advisory Committee on Pharmaceuticals, a drug plan or manufacturer;

2. A review team is established;

3. The evidence (that submitted and extra independently sourced material) is systematically reviewed;

4. The review is edited and assessed for quality before it is sent to the manufacturer for comment;

5. A dossier including the review, manufacturer's comments and a response to those comments is sent to the Canadian Expert Drug Advisory Committee (CEDAC);

6. CEDAC considers the submission and makes recommendations, which are sent to drug plans and the manufacturer in confidence;

7. An embargo period ensues, during which time clarification or appeals may be sought;

8. The final recommendations are made, sent to the drug plan and manufacturer and then released to the public.

Health Technology Assessment

This examines four questions:

  • How will this health technology affect the health of Canadians?
  • How does it compare with alternatives?
  • Does it provide value for the investment?
  • Are there other health service implications to consider?

There are several steps involved in the technology assessment process:

1. Topic selection. Topics can be suggested by anyone, including members of the public, medical directors or medical societies, or may come from CADTH's own Horizon Scanning Program;

2. Definition of the question the assessment will address. The Advisory Committee, the organisation or individual that suggested the topic and other groups are consulted at this point;

3. Formation of a project team and protocol development;

4. Assembly and review of the evidence. Published and unpublished evidence is brought together for analysis;

5. Writing the report;

6. Reviewing the report. External experts and members of CADTH's Scientific Advisory Board peer-review the report;

7. Dissemination of the final report.

Box 3.

52. CADTH's guidance is not mandatory. However, the Agency encourages uptake of its guidelines through the use of individual Liaison Officers, who are located in most provinces and work with local users and stakeholders.

53. To summarise, there are a number of differences between NICE and the organisations in Scotland, France and Canada. In Scotland, the SMC carries out a shorter, less in-depth evaluation of all new medicines and indications at the time of launch. It does not examine anything else. SIGN produces clinical guidelines along similar lines to those of NICE, but does not look at any other areas. HAS and CADTH examine similar areas to NICE but there are differences in their processes. In France, medicines are examined at the time of launch; they are not available to patients until they have been assessed by the Transparency Commission. Uniquely, as far as the bodies mentioned here go, pricing negotiations take place after evaluation. In Canada, new medicines are not available on publicly funded health plans until they have been evaluated by the relevant body.

Developments since 1999

54. The way in which NICE operates has changed since its establishment. Here we discuss a number of important factors that have affected the work of the Institute:


55. The remit of NICE has changed and expanded since 1999. Our predecessor Committee played a major role in influencing these changes. In 2001/02. the Committee undertook an inquiry to determine whether NICE was meeting the requirements laid upon it.[21]

56. The report emphasised that a body such as NICE was necessary to provide evidence-based clinical advice. The Committee highlighted the achievements of the Institute over the first few years of its existence, particularly in developing a robust appraisal process, but also saw room for improvement. It stressed the need for better information, an improved appeals system, better implementation and more emphasis on producing clinical guidelines. Other recommendations included the need for:

  • Greater involvement of the NHS, patient groups and other stakeholders in the development of NICE technology appraisals, and the use of more information relating to patient and carer experiences and quality of life in NICE guidance;
  • Closer working with the then Medicines Control Agency (now the Medicines and Healthcare products Regulatory Agency, MHRA) to improve the access of NICE to relevant information;
  • Reform of the appeals process (including removal of the Chair of NICE from the proceedings);
  • The need to ensure that no conflict, or risk to NICE's credibility, arose as a result of actions or recommendations issued by the Department of Health. This concern was raised in relation to policy on medicines for multiple sclerosis (MS);
  • Publication of technology appraisals at the time of drug launch, or of 'interim' appraisals when a full-scale appraisal is not possible; and
  • Improved monitoring of the implementation of NICE guidance, and research into systems within trusts that could improve levels of implementation; and
  • A review of NICE by an independent body.

57. The Government accepted that NICE should produce more clinical guidelines rather than focus on technology appraisals alone. It also agreed that measures were needed to ensure that companies submitted all relevant information to NICE. The Government conceded that more information on quality of life and wider societal cost : benefit analysis would improve NICE guidance and that improvements in the monitoring and implementation of guidance were needed.

58. NICE itself told us that it had made many changes in response to the Committee's first set of recommendations. These included:

  • The extension of the involvement of interested stakeholders in the guidance development process and increased opportunities for stakeholders such as PCTs, to contribute;
  • Closer working with the MHRA, including the sharing of information;
  • Greater transparency regarding what information NICE uses when making its decisions;
  • Removal of the Chair from the Appeals Committee;
  • Faster reviews of drugs (with the aim of producing guidance on new technologies at launch);
  • Improvements to implementation, through the establishment of the Implementations Systems Directorate.

On the other hand, a number of our recommendations have not been fully implemented, notably in relation to disinvestment in less effective therapies and NICE's access to all unpublished information.


59. In the years following the establishment of NICE, it became clear that not all technology appraisals were being uniformly implemented.[22]

60. To improve consistency in patients' access to treatment, the Secretary of State, Dr John Reid MP, made it a legal requirement that funding for all positive advice arising from technology appraisals should be made available within three months of publication.[23] This requirement only applied to technology appraisals.


61. In December 2006 Sir David Cooksey published a report on healthcare research and development.[24] It highlighted the world-class health research which takes place in the UK, but stated there were weaknesses both in the way that new research was 'translated' into the development of treatments and products to treat disease and in the way such products, once developed, were introduced to the health system.

62. The Cooksey report made recommendations to promote health research in the UK, and maximise the health and economic benefits of the new single research budget.[25] Those recommendations which most concerned NICE related to the development of new, and particularly innovative, technologies. In particular, the report stressed that NICE should evaluate drugs more quickly. The recommendations included:

  • A greater focus on the development of therapies for areas of unmet medical need, with evidence-based input from the Department of Health and devolved administrations on their priorities for healthcare;
  • Advantages for therapies addressing areas of unmet need, such as expedited approval of clinical trials and faster consideration of new technologies by NICE;
  • Fostering more support for health research from the NHS, with a more systematic approach to the uptake of new technologies by the health service;
  • Pilot schemes to test the benefits of NICE involvement at an early stage in drug development should take place, with NICE and the pharmaceutical industry working together to identify emerging technologies suitable for inclusion;
  • Clearer processes for following up recommendations provided by NICE to manufacturers should be developed.

63. If implemented, the recommendations would mean that new therapies addressing areas of unmet need would be brought to market quicker than at present. A new "drug development pathway", including the "conditional licensing" of particularly promising treatments, would support this endeavour. According to the Cooksey report, these changes would benefit patients primarily but also the healthcare industry, Government and the wider economy.

64. NICE is currently consulting about the Cooksey report's recommendations.


65. During the inquiry witnesses expressed concern that health ministers had undermined the work of NICE.[26] We were given two examples. The first involved the risk-sharing agreement established to allow NHS patients access to treatments for MS. The second concerned the breast cancer drug trastuzumab (Herceptin).

66. NICE evaluated beta interferon and glatiramer acetate for MS in 2001. In 2002, it did not recommend the treatments as neither was judged to be cost-effective. A public outcry followed. Witnesses believed that as a result of this outcry the Department of Health sought a way to make the drug available despite the NICE recommendation.[27] The Department came to an agreement with manufacturers of the drugs whereby the drug could be used in the NHS as part of a 10-year trial. It was agreed that if the drug was less effective than £36,000 per QALY, industry would recompense the NHS. However, there have been problems with the scheme; in particular it has proved impossible to assess how cost-effective the drug has proved in practice (see box on page 89). We asked to see the analysis produced by the University of Sheffield, including appendices, which the Department of Health has had for over 12 months, but at the time the Committee agreed the report, the Department had not made a decision about our request.

67. Witnesses were also concerned about the former Secretary of State's role in the case of trastuzumab. In November 2005, North Stoke PCT reversed its earlier decision to refuse the drug to a patient with early stage breast cancer[28] after the Secretary of State announced that she was "very concerned", called a meeting with PCT officials and asked PCTs to consider assessing the receptor status of their patients on the assumption that if the drug became available it could be licensed quickly.[29] Trastuzumab had not been assessed by NICE, or licensed for use in early stage breast cancer, at this point. However, evidence of the drug's efficacy for this type of cancer had been published on the manufacturer's investor website. The patient had threatened to take the PCT to the High Court to contest its original decision not to allow her access to the drug. Shortly after, the Department asked NICE to examine the drug early. Professor Mike Richards described this as "a political decision". [30] Professor Rawlins stated:

The scientific basis for Herceptin being effective and safe in early cancer had not been demonstrated …Added to which, at that stage the company had not even made an approach to the regulatory authorities, it had not made an application, so it was a surprising remark from a Secretary of State.[31]

68. We questioned the Minister of State, the Rt Hon Dawn Primarolo MP, about political interference in NICE's work. We were told:

I would absolutely stress that it is not the role for ministers to contradict, override or directly seek to influence a process where NICE are already engaged in consideration.[32]

She added that "NICE's final guidance will be final".[33]

We note that it is not the role for Ministers to directly or indirectly seek to influence the NICE decision-making process.


69. In March 2007, a judicial review was brought against NICE by the drug company Eisai, supported by the Alzheimer's Society and other patient groups. Eisai and Pfizer jointly market the medicine donepezil (Aricept) for the treatment of Alzheimer's disease. The case concerned guidance issued by NICE stating that NHS patients with newly diagnosed, mild Alzheimer's disease should not be prescribed the drugs donepezil, rivastigmine and galantamine, as treatment was not cost-effective. Rather, only those with moderate disease should receive the drugs. The case was brought on three grounds:

70. Only the last point was upheld. In August 2007, the judge ruled that the guidance did indeed discriminate against some patient groups and ordered NICE to change its guidance to reflect this finding.[34]

71. In September 2007, Eisai applied to the Court of Appeal for leave to appeal the finding in respect of access to the Southampton University model. The company has been granted leave to appeal.[35]

Successes and criticisms


72. Many witnesses stressed that the processes used by NICE were well-established and robust.[36] The different procedures for the evaluation of medicines and interventional procedures, and the development of clinical guidelines and public health guidance have been carefully considered.[37] They provide a good example of evidence-based working.

73. NICE has clearly attempted to incorporate effective consultation into its topic selection and guidance development processes. It consults widely and a variety of different groups, ranging from patient and carer organisations to professional bodies and the healthcare industry, have the opportunity to contribute to the draft guidance.[38]

74. NICE is well regarded internationally. An external review of NICE by the World Health Organization commended the appraisal processes used by the Institute.[39] Many countries look to NICE decisions when determining the cost-effectiveness of treatments for their own populations. Some of its clinical guidelines are regarded as the international gold standard of medical practice.[40]

75. Most importantly, NICE has encouraged the NHS and industry to put more focus on cost-effectiveness. It has also encouraged medicines manufacturers to produce evidence of the cost-effectiveness of their products, albeit with limited success to date.[41]


76. Over the course of the inquiry, however, we became increasingly aware that the job of NICE is more difficult than was first imagined. It faces difficulties related to prioritisation of topics for evaluation and the strength of the evidence on which it must base its decisions. There has been concern about the phenomenon known as 'NICE blight' and the implementation of guidance. Inevitably NICE makes controversial decisions which attract criticism. As a result there is a danger that public confidence in its work is affected.

77. Witnesses referred to three main areas of criticism:

These criticisms are discussed in more detail in later chapters.

Future challenges

78. Rationing occurs in all healthcare systems; not every treatment can be provided to all patients.[42] Decisions about what is affordable are likely to become ever more contentious. Public expectations of the NHS are rising. At the same time, more expensive new drugs are coming to market and the rate of growth in funding in the NHS is declining. As a result, the role of NICE in ensuring that the most cost-effective treatments are available to the patients that need them is becoming ever more important and ever more difficult.

79. It is clear that the environment in which NICE operates has changed considerably since the Institute was established in 1999. It is also clear that there is a vital role for NICE in the rationing of healthcare and in encouraging best clinical practice. In the future the role of NICE will be ever more important and demanding with new expensive drugs and a slower rate of growth in NHS expenditure. There remains, however, concern about aspects of how NICE does its job. How it should change to address these concerns is considered below.

7   National Institute for Clinical Excellence Framework Document, June 2000 Back

8   The selection of topics and disinvestment are discussed in more detail in the next chapter Back

9   More 'sifting' occurs later, and the topics referred at this point may not necessarily end up as the subject of NICE guidance. Back

10   The first two topics to be examined specifically with a view to disinvestment are: The surgical management of children with otitis media with effusion (OME) for children, to be published February 2008.; and The prescribing of antibiotics for self-limiting respiratory tract infections in adults and children in primary care, to be published June 2008:  Back

11   NICE's Technology Appraisal Committee is made up of individuals drawn from the NHS, patient and carer organisations, academia and the pharmaceutical and medical devices industries. Members stay on the committee for 3 years. The committee is divided into three branches, A, B and C. See for details. Back

12   Ev 230 Back

13   Chalkidou K et al, Journal of the Royal Society of Medicine 2007, 100: 453-460 Back

14   Ibid Back

15   Ev 5 Back

16   A committee of 30 lay people. The membership changes regularly. Back

17   Ev 10 Back

18   Office of Fair Trading, February 2007. Annexe B: Review of NICE, SMC and AWMSG:  Back

19   The SMC aims to provide advice to the NHS in Scotland within 3 months of product launch. Back

20   For potential coverage by participating publicly funded federal, provincial and territorial drug benefit plans Back

21   As set out in A first class service: quality in the new NHS Back

22   Eg. Civitas 2003. Nice or nasty: has Nice eliminated the 'postcode lottery' in the NHS? Back

23   Department of Health, July 2003. Directions to PCTs and NHS trusts in England concerning arrangements for the funding of technology appraisal guidance from the National Institute of Clinical Excellence Back

24   HM Treasury, 6 December 2006. A review of UK health research funding.  Back

25   A single, ring-fenced budget was set by the Treasury in 2006 for the purpose of health research and development Back

26   Q 322. Dr Tim Crayford Back

27   From Testing Treatments, Evans et al. Cited in Ev 248, NICE 117 Back

28   British Medical Journal, 2005; 331:1162 Back

29   Times, 8 November 2005,  Back

30   Q 70 Back

31   Q 649 Back

32   Q 720 Back

33   Q 728. The Minister was referring to NICE guidance on drinking alcohol during pregnancy. The Department of Health recommended in May 2007 that pregnant women should avoid alcohol completely. In October 2007, NICE draft guidance stated that moderate amounts of alcohol were not harmful. Final guidance from NICE has not yet been published. Back

34   Pharmaceutical Marketing, 28 September 2007. Back

35   The Court of Appeal has agreed to hear arguments from Eisai relating to the process used when NICE decided not to recommend the drugs for patients with newly-diagnosed mild Alzheimer's disease.  Back

36   Ev 2, 231, 70, 192 Back

37   Ev 202 Back

38   Ev 62, 229  Back

39   Ev 248 Back

40   Eg. schizophrenia. Chidgey et al, Journal of the Royal Society of Medicine 2007, 100: 448-452 Back

41   See paragraphs 121-134  Back

42   Ev 77 Back

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