In the media

How NHS collaboration with the pharma industry could benefit both players

Health Service Journal

18 August 2011


The challenge to find cost-savings while innovating services presents issues for both the NHS and the pharmaceutical industry to address, but an opportunity to collaborate could bring them closer together for the benefit of all. PA Consulting Group colleagues Dr Stephen Black and Ian Rhodes explain.

The NHS is one of the largest monolithic health systems in the world and is one of the largest organisations on the planet by number of employees. As a result it possesses one of the largest repositories of medical data anywhere and this should be a valuable resource for improvement and research.

Both the NHS and the pharmaceutical and medical equipment industry are facing major challenges. The industry has a high cost base and is struggling to create the next generation of products. The NHS faces very demanding productivity targets and has to manage increasing demand and public expectations.

However, there are real opportunities for both sectors from making better use of the wealth of data held by the NHS. Effective collaboration to share this data could reduce costs and drive improvement in patient care, develop payment systems for drugs based on outcomes; and to increase the productivity of drug research.

Although the NHS and pharmaceutical companies already work together in a number of ways, there are tensions that can create barriers to effective partnerships. Many in the NHS are suspicious that the pharmaceutical companies will exploit their intellectual assets for profit, while pharmaceutical businesses are understandably focused on safeguarding their investments in research and development, and ensuring a return.

So it is important to find ways to build trust between the two to unlock the enormous value of this collaboration. This needs to start with both parties understanding and acknowledging each other’s constraints and goals. It is then important to set out the required outcomes, and the terms of engagement on how they will hold each other to account.

Trust could be gained through building on existing collaborations, such as clinical trials with specific institutions, to demonstrate that these relationships can work effectively. Both parties also need to work together to set challenges for each other to deliver the desired outcomes.

For example, the NHS could commission pharmaceutical companies to develop and produce the most clinically effective drug at a given price and give open access to all the available data, with the prize being a known market for the drug.

Once these relationships are in place, then further opportunities for collaboration can be developed. One area where this could make a real difference is managing long term conditions, which account for a disproportionate financial burden on the NHS.

Effective use of data in home monitoring of these conditions can both increase the productivity of the NHS and improve the quality of life for patients. This, however, requires new ways of working both for the NHS and their partners. For example, to get the benefits of home monitoring of patients with chronic obstructive pulmonary disease, the NHS has to identify the sub-group of patients who will benefit most. This, in turn, requires the NHS to join up different internal datasets and change the way the service works with the patient, collaborate with device manufacturers and provide the patient’s own information back to them in a useful form so they can act on it with confidence.

Another challenge faced by both the industry and the NHS is to improve the effectiveness of new drugs and devices. Drugs and devices make up more than 10 per cent of the NHS budget so there is pressure to improve the effectiveness of this spending. However, many expensive new drugs offer greatly improved outcomes for one sub-set of patients, so the overall cost-benefit for the NHS looks poor. Equally, many promising candidate drugs fail clinical trials because of side effects that only occur in one sub-group of the population.

Should we develop more payment mechanisms that only rewarded the drugs that work? If this could be coupled with better identification of the right target patients (or patients who might suffer dangerous side effects) we could see major gains for both the NHS and the industry.

The NHS could also be used as a test bed to discover these sub-groups of patients where new drugs are really effective. This could lead to a much higher success rate in R&D, but would also allow the NHS to focus its budget where it will maximise the benefits. Where the NHS struggles to justify using expensive drugs which have limited success and where NICE might not allow use in the wider population, this approach could allow a pharmaceutical company to launch the treatment anyway, knowing that payment will only come where the treatment works.

Finally, effective exploitation of the huge data store in the NHS might help reinvigorate the process of identifying new drugs and devices by providing new insights into which disease processes matter to patients’ wellbeing. If, for example, the NHS could link together patient-level records of morbidity, treatments and prescriptions, it might provide new insights into targets and disease processes (or for immediate benefit, identify ineffective or dangerous prescribing patterns).

The NHS doesn’t have the skills to do this itself. However, collaboration could align the focus of the industry with the needs of one of its biggest customers for mutual benefit.

Existing NHS data may provide some of the insights if the right sort of analytical tools are used. But the NHS is also a potentially great place to test new ideas and to identify possible volunteers for trials of new treatments. This could then lead to faster development of new treatments (and would generate income from the trials for the NHS). The drug companies would gain from being able to improve the productivity of their R&D and from getting new products launched faster.

So it is clear that a much closer relationship as well as sharing and collaboration between the NHS and the pharmaceutical industry could deliver enormous benefits for all of us. The NHS is a hugely valuable strategic asset to UK plc and in combination with the pharmaceutical industry it could help to deliver the improvements in cost effectiveness, innovation and patient care that we need.


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