Practical Implementation of Innovative Pricing in the UK

The theory behind Innovative Pricing, and examples of what they could look like, are abundantly available across various mediums (on the off chance you have missed them, you can find an introduction here). With this in mind, I thought a more useful topic to approach might be how to implement these sorts of schemes in the UK.

There are, in short, three ‘problems’ any solution for the implementation of these schemes needs to address.

1. The implementation must make clinical sense, with endpoints and ‘measurables’ that are relevant to both the treatment and the payer.
2. The implementation must cause as little administrative burden to both sides of the contract as possible, otherwise, it will simply fall apart once operational.
3. The implementation must make financial sense to both sides of the contract, this includes the cost of the implementation to the pharma company (as well as any rebates or discounts created through the contract itself).

As such, one proposed solution is to run the contracts off the patient Electronic Health Record (EHR). For obvious reasons, I am not going to outline exactly how to negotiate the minefield that is NHS data protection rules or how to get around the fact that different portions of the NHS don’t use standardised coding formats, let alone database structures.

These are services we offer but we do need to keep some USP under our hats. However, I can show how our approach addresses the three problems outlined above.

Problem 1: Clinically Relevant

This is actually quite simple. It is a case of designing your scheme to take account of what the NHS naturally does without any interference from an outside body. Things like, the patient’s diagnosis and start and stop dates for long-term medications are universally recorded into the patient’s Primary Care records. This means indication variable pricing, ‘try before you buy’, and dose cap schemes can all be run with reasonable ease.

Large-scale acute events (such as heart attacks or strokes) are also ubiquitously recorded within primary care, so schemes, where the endpoint is the prevention of these types of events, are also fairly easy to implement.

What this leaves (for the keen-eyed of you) are Outcome Based Schemes that are reliant on very particular variables (such as HB1AC values for diabetes), that need to be taken at regular intervals. These still can be run, however, you will need to pick the variables that the NHS already collects on a regular basis. One option is to use values outlined in the NICE Guidelines, however, an even safer bet is to utilise values that count toward the Quality Outcomes Framework (see footnote). An example would HB1AC for diabetes or RCP3 questions for Asthma.

We also have a methodology that allows us to patch in data from numerous sources across the NHS if desired, allowing for a fine-tuning of variables to suit the contract you are trying to execute.

Problem 2: Administrative Burden

Most schemes that are currently run in the UK use a double entry system (i.e. the physician has to enter the information into the patient’s EHR and then into a second form for the contract or scheme). While this does work for small patient populations (e.g. rare disease), it is never going to be practical for large-scale chronic conditions such as Asthma.

By running the scheme off the patient’s EHR and designing the scheme to utilise values the physician will already be collecting, the administrative burden or the NHS is effectively zero. We run our algorithm’s periodically (monthly or quarterly depending on the scheme), and use this information to create concise reports for the relevant NHS institution (such as a Clinical Commissioning Group or Trust), and for the pharma company on which the rebates or discounts can be based.

Problem 3: Cost

Any of you with experience within Research Circles are probably starting to spot the potential problem with this methodology. Cost.
And you would be right, to a point. This would not be a cost-effective way to run one scheme, for one drug in a single locality. However, if you were to split it over several drugs in your portfolio, and run it over the whole of the UK, and then split that cost between several like-minded pharma companies, it starts to look very economical, very quickly.
And that’s what we are proposing. A centralised platform any pharma company can use, to run any scheme they like, for any treatment, anywhere in the UK.

If you would like to find out more about the CK Group’s Innovative Pricing Solution or how it might be able to help facilitate your scheme, feel free to get in touch. Please contact: e: or t: 01438 768718.

Quality Outcomes Framework or QOF is a system of standardisation and payment utilised within primary care in the UK. In short, if a physician hits certain targets, such as giving all of your Asthma patients

Author: Adam Marsh

Adam Marsh