1 The scope for savings in prescribing
1. The NHS in England spent £8.2 billion on
prescription drugs in primary care in 2006, around a quarter of
the total expenditure on primary care. There were 752 million
prescription items dispensed: an average of 14 items per head
of population, although patients over the age of 60 received a
much higher average of 38 prescription items per head in 2005
compared to an average of 4 items per head for patients under
16. The average cost to the NHS of a prescription item was £11,
but 88% of prescriptions were dispensed free to patients. The
volume of drugs dispensed and their cost is increasing, as new
treatments are approved, new opportunities to improve health through
medication are identified and the Department of Health introduces
new policy initiatives and National Service Frameworks to target
certain conditions.[2]
2. Many drugs are available in both branded and generic
versions. A pharmaceutical company creating a new drug usually
markets that drug under a brand name, normally initially under
the protection of a patent, which prevents other manufacturers
from making the drug. A generic version of a drug is pharmaceutically
equivalent to the branded version, containing the same active
ingredient(s), but may only be produced after the branded drug's
patent has expired. Brand name drugs are normally much more expensive
than generic versions of the same product, for example because
of manufacturers seeking to recover research and development costs.
For instance, in October 2006, generic simvastatin 20 mg
(a drug that is used to treat high blood cholesterol levels) could
be bought for £2.34 for a pack of 28, compared with £29.69
for a pack of 28 of the branded version. Although there are more
generic than branded prescription items dispensed, the higher
cost of branded drugs means that they account for three quarters
of the total drugs bill by cost.[3]
3. Increasing the use of generic drugs where appropriate
offers the chance to increase the value for money which PCTs get
from their expenditure on drugs. In some clinical areas it is
also possible to use generic drugs in place of branded drugs,
which while chemically different have equivalent clinical effects.
For example, the National Institute for Health and Clinical Excellence
(NICE)—the body responsible for providing guidance on the
clinical and cost effectiveness of drugs—explicitly recommends
that treatment is initiated with drugs of lower cost in the case
of statins, which are used to treat high blood cholesterol. There
is nevertheless wide variation between PCTs in the proportion
of statin prescriptions dispensed as generics, as shown in Figure
1.[4]
Figure 1: Variation in the proportion of statins dispensed in generic form during quarter 4, 2006
Source: National Audit Office
4. PCTs vary in the priority they give to improving
the cost-effectiveness of statin prescribing. 90% of new statin
prescribing is for low cost versions; but it may be more difficult
to switch patients' existing medications, and some patients will
experience side effects or intolerance to some drugs. For this
reason it is necessary to have a range of treatments available,
and there will always be a need for some patients to receive more
expensive versions of drugs.[5]
5. Generic statins have been available for three
years, and NICE guidance on the use of generics has been available
since January 2006. The Department's own data on statin prescribing
show nevertheless that the drugs being dispensed by pharmacists
are in many cases not the most cost effective. The NHS Institute
for Innovation and Improvement, which aims to support the NHS
by developing and spreading new ways of working and new technology,
launched its 'Better Care, Better Value' prescribing indicator
in September 2006. On this basis, the Department estimated that
£85 million a year could have been saved by more cost-effective
statin prescribing.[6]
6. The NAO considered four areas of prescribing,
including statins, and found that £227 million would
have been saved between August 2005 and July 2006 if all PCTs
had prescribed with the same efficiency in these areas as the
top 25% of PCTs. The four areas examined were for commonly prescribed
drugs, representing 19% of the total primary care drugs bill;
yet the NAO's analysis revealed large variations in the average
price paid per dose, as shown for three of these areas in Figure
2. Although there could be scope for further savings on the
rest of the drugs bill, the four areas considered by the NAO were
the most important for achieving savings which the Department
now needs to deliver.[7]
Figure 2: Cost per defined daily dose for drugs prescribed by PCTs in England, August 2005 to July 2006
| LOWEST
| AVERAGE FOR ENGLAND
| HIGHEST
|
| Statins
(used to reduce high blood cholesterol levels)
| £0.10
(North Eastern Derbyshire PCT)
| £0.21 | £0.37
(North Norfolk PCT)
|
| Renin-angiotensin drugs
(used to reduce high blood pressure
| £0.08
(South West Dorset PCT)
| £0.17 | £0.28
(Southport & Formby PCT)
|
| Proton pump inhibitors |
£0.46
(Plymouth PCT)
| £0.57 | £0.70
(North Norfolk PCT)
|
Source: National Audit Office
7. One prerequisite for efficient prescribing is
for GPs to prescribe generically whenever possible, writing prescriptions
by chemical name rather than by brand name, so the pharmacist
is able to dispense a generic version if it is available. Rates
of generic prescribing have improved considerably since the early
1990s so that now the rate of 83% is the highest in Europe. Nevertheless,
the price difference between branded and generic products means
that even small further improvements can deliver large cash savings.[8]
8. A high generic prescribing rate, although a necessary
condition for obtaining value for money from expenditure on drugs
in primary care, is not however sufficient to deliver the savings
identified by the NAO. For example, if a GP writes a prescription
by chemical name (i.e. generically) for a statin that is still
under patent, the pharmacist is obliged to dispense the branded
drug; whereas a lower cost generic can be dispensed against a
prescription for a statin no longer under patent, such as simvastatin.
PCTs that have been successful in delivering savings have supported
their GPs in starting new patients on more cost-efficient drugs
when appropriate and in switching existing patients' medications
when necessary.[9]
9. Another approach to controlling prescribing costs
is to establish a list, or 'formulary', that limits GPs' prescribing
choices to a list of recommended drugs for particular conditions.
This regime already applies for hospital consultants. We asked
the Department why GPs have greater prescribing freedom than consultants
and why they did not allow pharmacists to dispense generic versions
of brand name drugs, when available, against brand name prescriptions.[10]
10. The Department's view is that because prescriptions
written by GPs could be dispensed at any community pharmacy, rather
than at a hospital pharmacy as is the case for consultants' prescriptions,
it would be harder to control pharmacists' enforcement of a formulary.
The proportion of GPs' prescriptions written generically had increased
over the last decade, which was a very effective way of ensuring
that the drugs dispensed by pharmacists were the most clinically
effective and the most cost effective. The Department needed to
do more to ensure consistency between prescribing in primary and
secondary care, especially as much primary care prescribing is
initiated in hospital or influenced by local specialists. One
of their aims in publishing their recent work on area prescribing
committees was to strengthen the links between primary and secondary
prescribing.[11]
2 Q17; C&AG's Report, paras 1.1-1.6 Back
3
C&AG's Report, Figure 5; para 2.5 Back
4
Q 4; C&AG's Report, para 2.6; Figure 6 Back
5
Qq 4, 7, 42, 44, 69 Back
6
Qq 4, 6, 7; C&AG's Report, para 2.8 Back
7
Qq 40-41; C&AG's Report, paras 2.12-2.13, 2.17 Back
8
Qq 4, 11-13 Back
9
Qq 6-7, 13; C&AG's Report, para 3.1 Back
10
Qq 5, 10-13 Back
11
Qq 5, 13; C&AG's Report, para 3.38 Back
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