Examination of Witntesses (Questions 80-94)
NATIONAL HEALTH
SERVICE & DEPARTMENT
OF HEALTH
11 JUNE 2007
Q80 Mr Dunne: The NAO Report suggests
a number of areas in which GPs in particular could be encouraged
to prescribe in a more cost-effective way, one of which is through
financial incentives. Case study 3, on page 23, shows what happened
in Bristol North and Coventry PCTs. To what extent do you at the
centre look to financial incentives as another quick win to help
best practice?
David Nicholson: Financial
incentives are an important tool in the armoury, if you like,
of financial control and for getting change to happen, and they
have been effective in the primary care area. But again, it seems
to me that incentives around practice-based commissioning—that
is, where you can clearly show that savings in prescribing can
be reinvested in improving local health services—and peer
review are a much more fruitful way of moving change forward.
Q81 Mr Dunne: To pick up on one of
the comments that Mr Curry made, one of the points made to me,
representing a rural area, is that patients in rural areas tend
to have a closer relationship with their GP and are perhaps more
resistant to change than patients in an urban area. Therefore,
for someone with a chronic illness on a long course of treatment
who has accommodated one change, accommodating subsequent changes
perhaps gets more and more difficult. Consequently, rural areas
tend to have higher prescribing costs than urban areas. Is that
the evidence at the centre?
Professor Colin-Thomé:
I do not think that that is to do with the relationship. Many
GPs, including me, worked in socially deprived areas and were
there for 30-odd years. The relationship is there across many
areas, rather than just rural areas. The only thing about rural
areas that might have made a difference was that in many rural
areas the age profile is higher than in some other parts. But
many GPs in socially deprived or urban areas stay for quite considerable
lengths of time. I have forgotten the exact figures, but the length
of time that the average GP spends in one area is several years,
so I think that the relationships are the same in many parts.
David Nicholson: What is
true—it has been reinforced by the discussion today—is
that switching a patient with a long-term condition from one drug
to another is a big issue and involves quite a lot of discussion.
Indeed, I was talking about that with someone the other day—you
have to see every patient individually and talk them through the
whole process, and they have to be satisfied with everything from
the colour of the tablets to the packaging, which takes time.
Q82 Mr Dunne: We have had a submission
from an external party in relation to generics. One of the difficulties
with generic drugs is that many of them are manufactured using
different tablet sizes, colours and shapes and come in different
types of packaging. That can be very confusing, particularly for
elderly people who have got used to a particular look and where
patients are taking more than one drug. Is there anything that
the NHS can do to encourage the standardisation of the generic
drugs that are prescribed here in terms of appearance?
Dr Harvey: I do not think
that we can do anything on that, because it is up to the individual
manufacturer to come forward.
Q83 Mr Dunne: But are you not one
of the manufacturers' largest customers in the world?
Dr Harvey: We are about 3.5%
of the global medicines market, which is not a huge proportion.
Nevertheless, we have a very active generics market here. What
we are finding, however—this is about the importance of
the relationship between the pharmacist and the patient—is
that some pharmacies, if they are dispensing a generic, will find
out what form of it the patient had last time, so that their patients
do not have to go through changes where the generic that they
have one month looks different the next month. This is an issue
that some pharmacies are looking at. However, there is nothing
that we can do centrally, because we are one purchaser, as it
were, within the global market for generic medicines.
Q84 Mr Dunne: We have had evidence
from the chair of the Royal College of General Practitioners that
GPs are often hampered by the lack of clear information on best
choices, which is one of the issues that is touched on in the
NAO Report. Prescribing advisers are there to provide that information.
If there is one prescribing adviser and 25 GPs, and given the
reaction from the Royal College, does not that suggest that they
are not doing their job properly?
Professor Colin-Thomé:
Yes—well, not that they are not doing their job properly,
because they are only one facet. Every GP funded by the Department
of Health receives the "British National Formulary",
which is superb, because it gives both clinical guidelines as
well as NICE recommendations and the range of drugs that can be
offered. As Dr Harvey mentioned, it is not just about prescribing
advisers as they might well focus on practitioners who need special
attention.
Q85 Mr Dunne: Can I just pick you
up on that point? I am aware of it, but table 16 on page 25 indicates
that the "British National Formulary" is cited by only
3% of high prescribers and 0% of low prescribers as their main
influence in prescribing.
Professor Colin-Thomé:
It is one of many, but what I am saying is that GPs have ready
access to information. There is evidence that older GPs like face-to-face
consultations with advisers, which is why we have a menu of options.
If GPs say that they do not have ready information, I would argue
that they should not be able to use that excuse, because one cannot
get much better than what is available.
Q86 Mr Dunne: Those GPs that also
operate as dispensing practices generate quite a significant proportion
of their remuneration from dispensing activities. Is there not
an inherent conflict for them in seeking to reduce the cost of
prescribing with their own remuneration? How do you deal with
that?
Professor Colin-Thomé:
There is a risk. However, if you look at the evidence from dispensing
doctors, their average costs match those of non-dispensing GPs,
as I have said. There is a small percentage of very expensive
drugs that might seem to be more common in dispensing practices,
but even that number is declining. In any event, we changed the
remuneration to create a flat rate instead of having payments
linked to the drug cost. Dispensing doctors provide an excellent
service where pharmacies are not available. In fairness, the average
costs and prescribing patterns were very similar, and there were
only one or two small examples in which that was not the case.
Q87 Mr Dunne: Turning to pharmacists
rather than dispensing practices, is there any specific incentive
on them to be supplied by either the branded drug producers or
by the generics? My sense is that they have more flexibility with
generics than with the branded drug suppliers, because they can
negotiate better deals. Is that fair? One would then be inclined
to get a higher proportion of such drugs from pharmacists.
Dr Harvey: They can certainly
negotiate their deals. On reimbursement, they are reimbursed at
the category M reimbursement price for generics and in relation
to branded drugs they are reimbursed at the PPRS price. It is
important that they purchase well, which is why the remuneration
system incorporates a degree of permitted retention of received
discounts, so as to ensure that prices and markets are kept buoyant.
Q88 Mr Dunne: I have a final couple
of questions on NICE and new drugs. The Report mentions that few
drugs are coming off patent during the next year or so. With medical
advances, what sense can you give the Committee of how many drugs
you anticipate that NICE will approve during the next 12 months
or so? If there is an accelerating drug discovery pattern, what
pressure will that put on the prescribing budget?
Dr Harvey: I cannot remember
the exact number, but I know that NICE is conducting many appraisals
at the moment. From memory, I believe that it is approximately
26, although that might not be correct and we might need to come
back to you with the correct figure.[5]
A lot of new drugs are being processed at the moment. The new
single technology appraisal mechanism means that the NICE process
begins much earlier, as the licence dossier for the drug is submitted
to NICE and the regulator. That means that the NHS has information
within a couple of months of a drug having market authorisation.
In terms of what has been happening to
date in respect of pressure from NICE, since NICE came into being
in 1999, there has been huge growth in NHS finances. The overall
increase in the drugs budget[6]
due to NICE recommendations on drugs has been about £1.2
billion. That comes from huge growth of many, many billions within
the NHS.
Professor Colin-Thomé:
Some £40 billion.
Dr Harvey: There has been
£40 billion worth of growth in the NHS. When we put drugs
into the work programme for NICE, we look carefully at the cost
implication that we will see down the line for PCTs. That is factored
into the finances for primary care trusts. We consider that very
carefully.
However, it is fair to say that as novel
medicines get more and more innovative and specific for people,
we may find down the line that we want to spend a greater proportion
on drugs, because of the impact that that would have on changing
patient pathways—having more care out of hospitals and at
home, which is very much the direction of the White Paper. Clearly,
we need to look at that for the long term, in terms of horizon
scanning for the sort of impact that medical advances can have.
Chairman: The final question comes
from Mr Mitchell.
Q89 Mr Mitchell: In answer to an
earlier question, David Nicholson said that when negotiating prices
with the drugs firms, you had to bear in mind that they make up
a major British industry and a very effective competitor. That
must mean that you are giving them a soft deal—that you
are subsidising them.
David Nicholson: I do not
think that that is the case.
Q90 Mr Mitchell: Why say that, then?
David Nicholson: We have
to take it into account. Our current arrangements are being reviewed
in the light of the OFT report on the drugs industry. We are reviewing
those, and the Government will at some stage come forward with
their proposals on that. One of the benefits of the arrangements
that we have at the moment is price stability, which is beneficial
to us in terms of planning and also as far as the industry is
concerned.
Q91 Mr Mitchell: Prices should be
coming down. These are big multinationals, and there is no need
for them to be subsidised in this country.
David Nicholson: Prices are
coming down. Two and a half years ago, we agreed a 7% reduction
with them as part of the 2005 PPRS.
Q92 Chairman: Thank you very much,
Mr Nicholson. The fact remains that although we constantly read
of the NHS being short of resources, £200 million a year
could be saved if doctors prescribed generic drugs, which are
just as effective as branded ones. My colleague Mr Dunne referred
to the case study in Bristol. I am not convinced that you are
being sufficiently energetic in encouraging GPs to prescribe generic
drugs. Our job in this Committee is to protect the interests of
the taxpayer, and I am sure that our Report will reflect that,
Mr Nicholson.
David Nicholson: May I say
two things about that?
Chairman: You may have the last
word.
David Nicholson: First, we
have the highest generic rates in Europe.
Q93 Chairman: So what? You could
always do better.
David Nicholson: Of course,
but we are doing extraordinarily well compared with other health
systems across Europe. Secondly, prescribing is about not just
cost, but quality.
Q94 Chairman: Of course. But I specifically
said that we could save £200 million by prescribing drugs
that are just as effective as branded ones.
David Nicholson: But the
quality of the relationship between the GP and the individual
patient is important to us in that regard.
Chairman: Thank you very much, Mr
Nicholson and colleagues.
5 Note by witness: NICE's Business Plan indicates
that it expects to publish around 32 Technology Appraisals in
2007/08, though some of these will include guidance on more than
one drug or technology. A small number of NICE appraisals relate
to non-drug technologies. The exact number of pieces of guidance
published will depend on factors such as drug licensing timescales
and whether or not appeals are lodged against particular appraisals. Back
6
Note by witness: This relates to total estimated drug
spending, in both primary and secondary care, not just the area
of expenditure studied in the NAO Report which focuses only on
primary care. Back
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