HSE's concerns on funding CF drug

The head of the HSE has warned Health Minister James Reilly that the State may in future be unable to afford the cost of expensive high-tech medicines, and that paying for them may lead to funding being diverted from other services.

Tony O'Brien expressed his concerns on Thursday, just before the Minister decided to make the cystic fibrosis 'wonder' drug Kalydeco available to patients. Mr O'Brien said the HSE would be in a position to approve the medicine subject to a final decision on the matter from the Minister.

The HSE recently agreed a price reduction for Kalydeco with the manufacturers, Vertex Pharmaceuticals.

Despite the HSE's decision to recommend that the drug be funded, it still has major concerns over the future financial implications for the State of approving Kalydeco.

In a letter to the Health Minister on Thursday, Mr O'Brien said the HSE Drugs Group had decided on balance that society would wish that the CF medicine be funded but it was concerned that the precedent may have implications in the long-term for the affordability of new drugs and other medical technologies.

He pointed out that the cost to the State of funding Kalydeco would amount to around €220 million over 10 years. The drug has been hailed as a major breakthrough, offering hope for the estimated 120 patients in Ireland with a particular mutation of CF who could benefit from it.

Mr O'Brien told the Minister that the HSE Drugs Group recognised that there is a significant chance of substantial survival benefit for patients who take the new drug.

However, the Drugs Group, in its opinion on funding Kalydeco, said the survival benefit had not to date been formally demonstrated and any estimate of survival benefit was prone to great uncertainty.

The group said while a new lower price for Kalydeco had been agreed with the manufacturers, it was still concerned about the cost of the drug to the State.

It warned that a positive reimbursement decision might ultimately have implications for the funding of other social services, including health services, and felt funding such an expensive drug could rapidly make adoption of new drugs and other medical technologies unaffordable.

The Drugs Group said the proposed new pricing arrangement would result in 'economic outcomes multiple factors beyond any conventional understanding of cost effectiveness.'

It said it was concerned that the pharmaceutical industry might believe that the HSE considered this level of pricing to be acceptable or reasonable.

However, the group recognised that affordability of new high-tech drugs was a concern that health systems in all countries were struggling with.

It said what was now available in terms of price was a final offer from the manufacturers and a decision had to be made on that offer, which was a significant improvement  the originally quoted price.

Prior to the recent price reduction, the National Centre for Pharmacoeconomics (NCPE) had recommended against the drug being funded by the State at the submitted price.

The Drugs Group concluded that society would wish that the medicine be funded, given the possibility of significant survival benefits, but said the effectiveness of Kalydeco should be monitored in the long-term to ensure the extent of its benefits to patients was demonstrated.

Mr O'Brien told the Minister that following agreement on a lower price for the drug, approving it would not lead to the HSE exceeding its new high-tech drugs budget for this year.

It will cost around €22 million to fund Kalydeco for 120 patients this year. The HSE's entire budget for funding new drugs for 2013 is €70 million.

Minister Reilly had come under considerable pressure politically and from patient advocates to approve Kalydeco.

CF drug to be made available

[Posted: Sat 02/02/2013]

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