Ant McWatt comment ed April 26th:
I think the idea is that if the British government are serious about
reducing the tax burden of the NHS on UK taxpayers, one of the better ways
for them to do this would be to set-up in-house divisions within the NHS to
provide drugs and medical equipment (and the research in these) rather than
relying on private companies to provide them. You can see such a policy as
largely cutting out the middle man i.e. the shareholders in these private
companies. I state "largely" as there probably would be _in practice_
certain specialised drugs and equipment that only some private companies
could provide (either due to licensing, technical or economic reasons).
Platt then asked April 27th:
It would appear that such a change would virtually eliminate the free market
as the provider of drugs and medical equipment, risking the loss of Dynamic
Quality. Do you see this as a concern?
Ant McWatt comments:
Platt,
Good question. Yes I think it's a concern that would have to be kept in
mind though the present arrangement isn't sustainable nor particularly
Dynamic. For instance, see a couple of sections from a recent article from
the UK's "Healthcare Equipment and Supplies" journal in the following:
Watchdog deplores NHS drug bills
February 20th 2007
By Gregory Roumeliotis
The NHS is paying up to ten times more than it should for some drugs and
needs to reassess its pharmaceutical procurement mechanisms, the Office of
Fair Trading (OFT) has concluded.
In a damning report, the OFT identifies a number of drugs where prices are
significantly out of line with patient benefits and blames the
pharmaceutical price regulation scheme (PPRS) for the excess expenditure.
The PPRS is a voluntary scheme negotiated every five years between the
Department of Health (DH) and the Association of the British Pharmaceutical
Industry (ABPI). It consists of price-capping and price-controlling
components.
--cut---
The OFT argues that the profit cap has had little effect on company
behaviour, since... neither the profit cap nor the price cut helps ensure
that the price of medicines reflects the health benefits they bring to
patients, according to the OFT.
Focussing prices on the needs of patients rather than on the costs [read
profits - Ant] of drug companies would be good for both patients and for
business, said OFT chief executive John Fingleton.
It would allow more patients better access to more effective treatments and
it would focus drug company innovation and investment on the areas where
patients need it the most, creating more valuable drugs in the future.
The regulator believes the current regime is unsustainable because hundreds
of millions of pounds are spent every year on expensive drugs, for example
for cholesterol, stomach acid and high blood pressure, which have
alternatives that may be slightly less effective but much less expensive.
Therefore, the OFT wants to see a patient-focussed value based pricing
scheme, such as that found in countries like Sweden, Australia and Canada,
where the prices that the government pays for medicines reflect the
therapeutic benefits they bring to patients.
The OFT estimates that this would release in the region of £500 million of
expenditure that could be used more effectively, giving patients better
access to medicines and other treatments which they may currently be denied.
http://www.hesmagazine.com/story.asp?storyCode=2042326
In other words, if most drugs were supplied "in house" by the NHS (rather
than private drug companies), inefficient schemes such as the
"pharmaceutical price regulation scheme" (PPRS) wouldn't arise in the first
place to be a burden on the taxpayer. Also note the reference to Canada (as
a role model) which Arlo has mentioned recently in comparison to the US
health system.
Best wishes,
Anthony
.
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