Questions linger as England’s Innovative Medicines Fund kicks off

Market Access
medical innovation

In part one of this two-article series on the latest on England’s Innovative Medicines Fund (IMF),  Leela Barham examined what the IMF is and what is known about how it will work. In part two, Leela explores some of the questions that remain about whether the IMF will add value and serve its purpose.

Political capital

When it comes to politics there can be a lot of value added from approaches like the IMF and the CDF. They generate all those upbeat press releases and they do have a feel-good factor, and of course, one of the benefits is also that they also allow for those statements to talk about the thousands of patients that have, and can be, treated in the future. Big numbers are often useful for comms.

Deals could already be done

Yet there is a question to pose about whether such funds really add value, given there were already mechanisms in place that would have allowed access, including evidence generation to move from a promise to making sure that they deliver the hoped-for clinical benefits at a price that offers value for money. NHS England (NHSE) recognises this, pointing to an agreement with Orchard Therapeutics for Libmeldy (atidarsagene autotemcel), a gene therapy for metachromatic leukodystrophy (MLD) as well as spinal muscular atrophy (SMA) therapy, Zolgensma (onasemnogene abeparvovec).

It was already possible for the NHS and health technology assessment body, NICE, to agree arrangements with companies that covered both commercial and evidence generation issues and provide interim funding for some of the most promising treatments for rare diseases.

Could deal-making become easier?

The added value of the IMF really hinges on whether it will become easier to reach such deals now that there is a framework in place, one that could add more consistency that will allow companies to know a little more on what’s expected and when, as they negotiate deals.

Companies might not be all that keen though, now clear that any deal in the IMF includes a commitment for the company to continue to provide that treatment, even if NICE subsequently says no, running the risk of no routine funding and perhaps a lifetime commitment to treat. That is different to the CDF, which came with no such commitment, albeit in part that’s because many cancer treatments simply won’t be used for that long given the nature of the rare cancers and low survival. Hitting – and crucially offering an even better deal – current cost-effectiveness thresholds is also tough when it’s treatments for very rare diseases too.

Yet it might also prove to be a thorn in the side of NICE and NHSE, they’ll find it harder not to come to the table if future new treatments meet the criteria for consideration of the IMF. That could level the playing field when currently not all companies feel that they can get NHSE to talk about potential deals. However, it also takes work and both NICE and NHSE only have so many people and so many hours in the day.

Criticism likely to continue

Not everyone has supported the CDF. There is always the concern that money could be spent on drugs that might look promising but may turn out not to be as good as hoped for. That means other, more cost-effective care, could have been funded with that money. The same argument applies to rare disease treatments.

An implicit rationale for any interim fund is that it’s worth the NHS spending something – probably less than the prices that might otherwise have been sought by companies, given the need to strike commercial terms – to find out if the promise of these new treatments can be delivered, and cost-effectively. Yet it’s only after the fact that you can know if the spend on interim was ‘worth it’ from a value for money for the NHS perspective.

How will the IMF work alongside VPAS?

The UK has a voluntary scheme – and a statutory one that is almost in lock step with it – that requires companies to make payments to the DHSC when total spend on branded medicines goes beyond a pre-agreed growth rate, known as VPAS. The current growth rate is 2% and the industry has paid back over £2 billion since the latest deal was struck and implemented in 2019.

VPAS is essentially a cap on branded medicines spend from the perspective of the UK government. Looking at it from the industry side, it’s a sales tax as companies have to pay back 15% on their sales in 2022 and that’s projected to rise to 23.7% in 2023.

The IMF, just like the CDF, has an expenditure control mechanism (ECM). That means that collectively companies who have treatments in either fund will need to all pay back should more than £340 million be spent. With VPAS in place, it seems to duplicate.

Unsurprisingly there’s little sympathy with this idea in NHSE’s response to the engagement exercise. It doesn’t even get a response, although the issue was brought up by respondents.

At the very least, there’s a lack of detail on just how the new total of £680 million that will be spent in the CDF and IMF will be treated under VPAS and any successors. Details on this are absent from the VPAS, although the predecessor to that deal did have an adjustment for the CDF set out in an appendix.

Time will tell

There’s quite a bit of optimism about the IMF. But is that optimism misplaced? It’s always hard to tell as much rests on both the ‘system’ but also the appetite amongst companies.

About the author

leela barhamLeela Barham is a researcher and writer who has worked with all stakeholders across the health care system, both in the UK and internationally, on the economics of the pharmaceutical industry. Leela worked as an advisor to the Department of Health and Social Care on the 2019 Voluntary Scheme for Branded Medicines Pricing and Access (VPAS).