Pfizer Drug Wins U.K. Support Following Overhaul of Cancer Fund

(Bloomberg) -- Pfizer Inc.'s leukemia drug Bosulif won the backing of a key health authority in the U.K. after the nation's public health system overhauled how it pays for cancer treatments and the pharmaceutical company offered discounts.

The U.S. drugmaker is providing undisclosed concessions on the current price of 45,000 pounds ($58,000) a year for treating each patient, the National Institute for Health and Care Excellence said Thursday in a statement. NICE, which assesses the cost and effectiveness of medicines, said it would recommend that the U.K.'s National Health Service begin using the drug for people with chronic myeloid leukemia.

The endorsement makes Bosulif -- which has been available in the U.K. through the government's Cancer Drug Fund after it was rejected by NICE in 2013 for broader use -- the first treatment to be reconsidered for coverage by the NHS. The cancer fund's mushrooming budget was capped at 340 million pounds for the current year in the overhaul, and NICE was authorized to determine which drugs would be covered. Pfizer said the reforms don't go far enough.

‘Not Sustainable'

“All too often, U.K. patients don't get access to the modern medicines they need because of the way the health system values and assesses medicines,” David Montgomery, medical director of oncology at Pfizer, said in a statement. “It is not sustainable to ask companies to continuously drop the price for these medicines and it will impact our ability to make further medical progress if we do so.”

About 80 new patients across England and Wales will now be eligible each year to receive the treatment within the public health system, NICE said. The authority is reviewing another 30 drugs, previously covered by the Cancer Drugs Fund, and also began appraising new treatments in July. Existing patients can continue to get their oncology treatments through the fund.

Initially set up to cover the expense of cancer drugs not routinely used by the NHS, the Cancer Drug Fund's costs more than doubled to 416 million pounds for the 12 months ended March 2015, from 175 million pounds two years earlier, triggering calls for changes.

The new system is designed to cut costs and speed up access to new drugs, NICE said in March. A key change is that the authority will begin to review the cost-effectiveness of the cancer drugs when companies file an application with the U.K.'s Medicines & Healthcare products Regulatory Agency, rather than waiting for the regulator to grant the license.

Taxpayer Benefits

“Companies will be given the opportunity to demonstrate their drugs will benefit patients and bring value to the NHS,” Andrew Dillon, chief executive officer of NICE, said at that time. “Taxpayers can be reassured that only those medicines that are clinically and cost effective will be used routinely.”

Drugmakers see fewer benefits.

“Ultimately, NICE's methods haven't changed and they remain narrow and technical, which often doesn't work for cancer medicines and rare diseases,” Pfizer's Montgomery said in e-mailed responses to questions. “Medicines that treat hundreds of thousands of people and medicines that treat thousands or even hundreds of patients shouldn't be assessed using the same measurements of value.”

Bosulif, known as bosutinib, is used to treat CML patients who have an abnormal chromosome –- called the Philadelphia chromosome –- that can lead to an overproduction of white blood cells. It typically offers a treatment option for people who don't respond to other drugs. The medicine is projected to generate $70 million in sales this year for Pfizer, according to analysts' estimates compiled by Bloomberg.

Final recommendations by NICE typically form the basis of funding decisions for NHS bodies across the country.

To contact the reporter on this story: John Ainger in London at jainger@bloomberg.net. To contact the editors responsible for this story: Chitra Somayaji at csomayaji@bloomberg.net, Tom Contiliano at tcontiliano@bloomberg.net, Stephen West