U.K. to extend cancer drug fund for treatments NICE rejects

NICE, the cost watchdog for the U.K.'s national health system, this week nixed Pfizer's ($PFE) targeted lung cancer drug, Xalkori. While effective, they found its benefits were not worth its cost. Last month the gatekeeper said Roche's ($RHHBY) new breast cancer drug Perjeta was also too expensive. But NICE is not always the final say on whether expensive, new treatments will be paid for. Doctors can turn to a £200 million ($322.2 million) annual fund set up two years ago to pay for such treatments, a fund that the government is about to extend, despite its critics.

The Financial Times says that Prime Minister David Cameron will announce at the Conservative party conference next week that the fund will be renewed. While drugmakers and the cancer patients who tap the fund will obviously be pleased, there are critics. They argue the money spent on those drugs could better be used to buy drugs where the government will get more bang for its buck or on prevention measures. The Lancet medical journal slammed the fund as "the product of political opportunism and intellectual incoherence."

The cancer drug fund has been an important safety valve for some drugmakers. Roche's Avastin has been turned down by regulators for payment for any of the 5 areas it is licensed for treatment, such as colorectal and lung cancers. NICE turned it down for ovarian cancer in April. Yet it is one of most prescribed drugs in the country.

Pharmafile points out that the fund was initially set up as a stop-gap while the government negotiated new "value based pricing" with drugmakers, which begins in January. It says that Roche, Novartis ($NVS) and Sanofi ($SNY) have been lobbying the government hard to either maintain the fund or overhaul its approach to approving drugs. "We feel that NICE's methods need to be reformed to better take into account the nature of cancer and the way it can be treated," Sanofi's Katy Munns told the publication. "It is hard to see how the CDF (cancer drug fund) can be withdrawn if VBP simply inherits the existing process".

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