Avastin and cost effectiveness

I can’t understand the blame being apportioned in press coverage over NICE’s decision not to fund Avastin, or bevacizumab, for the treatment of advanced bowel cancer. Many patients groups are laying the blame with NICE. Is this fair?

The important bit to me is ‘cost effectiveness’. It isn’t about either cost or effectiveness alone. While Roche have offered a risk sharing scheme for cost (which wasn’t much less cash and still looked pretty expensive to me), it would have been better had they simply made their product cheaper. In other words, if you have a product which is marginally effective, compensate for this by making it less expensive. If the price is right, it thus becomes cost effective and NICE approved.

Don’t blame NICE. Examine the pharmaceutical pricing instead.

3 Responses to “Avastin and cost effectiveness”

  1. 1971thistle August 30, 2010 at 9:56 am #

    I feel this an unrealistic approach to the cost of drug development economics. Avastin is already funded in a number of other European countries; if the UK was to have it a lower price, most of the Avastin in the UK would be parallel-exported to mainland Europe; savings would simply absorbed as profit by the traders (we have already seen UK shortages in certain medicines as a result of this when the UK pound was weak; even UK hospitals were profiteering on this, for goodness’ sake).

    Also, a company cannot easily have major differences in price. As a result of reference pricing, if you cut in one country, you trigger cuts in others who use their neighbours price as a basis for reimbursement; the UK is a popular choice for reference pricing already. That’s why it is more attractive to offer risk-sharing as a way to discount, rather than a price cut.

    It just underlines how arcane drug pricing is. Nothing else I can think of is so constrained

  2. Margaret McCartney
    margaretmccartney September 1, 2010 at 6:43 am #

    http://blogs.bmj.com/bmj/2010/08/31/james-raftery-on-bevacizumab-for-metastatic-colorectal-cancer/?utm_source=feedburner&utm_

    this is an interesting backview on the costing process in this instance: I think the bottom line is that it’s still too expensive for what it does…

  3. 1971thistle September 6, 2010 at 10:07 am #

    Fair point re perhaps being too expensive, although I guess for those it does help it’s valuable. It does seem to be funded in other countries, all the same.

    However the point I was trying to make is that a manufacturer cannot just cut the price; the consequences of so doing are complex; parallel exporting and the impact via international reference pricing being just two of those factors. I think the discount scheme was an honest attempt to make it more accessible/affordable.

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