Tuesday, December 04, 2007

A NICE New Business: Fee-for-Advice

The UK’s National Institute of Clinical Excellence (NICE) is piloting a fee-for-service business that would see companies paying to receive early advice on what kind of cost-effectiveness and pharmaco-economic data they might require to secure drug reimbursement.

Speaking at the Financial Times’ Global Pharmaceutical and Biotechnology Conference in London on Monday, NICE CEO Andrew Dillon talked about the need for earlier engagement with industry, and mentioned a test-run it was carrying out with Novartis. “We’ve just completed the formal part of the process, in an attempt to provide some sort of proof-of-concept for the idea,” he told the audience. He declined to specify which Novartis drug candidate is the guinea pig.

NICE will present an evaluation report to its Board at the end of the first quarter of next year, according to Dillon, outlining how valuable the process has been, and what resources are required. It will presumably also outline in more detail how many meetings take place and at what stage in the drug candidate’s development. "I would envisage companies seeking advice as they prepare their phase 3 studies, although in principle they might approach us at any stage in the development of a product," noted Dillon in an email after the meeting.

As pressure mounts on drug companies to prove not just that a product works and is safe, but that it's also cost-effective, many firms want and need to engage with bodies like NICE well before approval stage. Sure, some are now being more creative in circumventing negative reimbursement recommendations--as we saw in the case of Johnson & Johnson and the risk-sharing rebate scheme it suggested for blood-cancer drug Velcade. But better still to have the appropriate data in the first place, ideally at minimum extra cost.

If the early-advice scheme is adopted, drug firms will have to pay for the privilege, though. “This will be a fee-for-service business,” Dillon told IN VIVO Blog. NICE will have to charge companies given the additional resources required, he explained.

But isn’t there a conflict here—companies paying NICE for advice on whether their drug might be labelled cost-effective? Not really, according to Dillon. “Regulators charge extra for early consultations with companies,” he says, “so why not us? It’s what everyone wants.”

That’s for sure. And given NICE’s influence beyond the UK, the agency may find clients seeking advice on how to best design their trials and provide optimal pharmaco-economic data even if the UK isn’t their target market.

Potentially a nice bit of business on the side for NICE, then.

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