For those who need it will be free - but not to the health service, who do have to pay the sticker price.

I understand your cynicism, but let’s inject some actual data.

The price that the manufacturer charges for a course of blinatumomab (in a different indication for adults, not that this is especially relevant in this discussion) is ~£56k [0] - so significantly lower than the price quoted from the US.

NICE (the organisation which published the document referenced) exists to achieve value for money for the NHS for higher-priced and specialist treatments. If, following a thorough assessment, a medicine does not achieve the required value for money standard at the price proposed by the manufacturer, they are presented with two options: to not have the drug reimbursed in the UK at all, or to lower the effective price, so that the drug becomes cost-effective.

[0] https://www.nice.org.uk/guidance/ta589/documents/final-appra...

> If, following a thorough assessment, a medicine does not achieve the required value for money standard at the price proposed by the manufacturer, they are presented with two options: to not have the drug reimbursed in the UK at all, or to lower the effective price, so that the drug becomes cost-effective.

Which is effectively price controls, because the number of people with the money to pay out of pocket will be low, so the choice is essentially to sell at the regulated price or not at all. And the company would be crazy to choose the latter because the high cost is to pay for R&D, not manufacturing, so they'll never be better off to abandon the market than to take whatever they're offered.

Then you have prices being set by the political system. If the regulators get captured by pharma companies (as would be likely if implemented in the US) they'd overpay when the drug isn't worth it. If not, the regulators would have all the leverage and very little reason not to set prices too low, reducing the incentive for R&D and causing more people to die.

They have a disincentive to sell to other countries at a discount if those countries allow medical tourism from the US. They don't want US patients taking advantage of the lower cost there.

And then many countries don't allow that, for exactly that reason.

I'd assume this kind of pricing negotiations between government entities and state of the art pharmaceutical companies is a deadly dance around how much money needs to be paid to the companies to incentivise research, lobbying and how much money a life is worth.

Yes, selling for cheap is better than not selling at all, but if the government entities keep being stingy, maybe next time the company won't develop a treatment for a rare disease at all because it's just not worth it...

> Yes, selling for cheap is better than not selling at all, but if the government entities keep being stingy, maybe next time the company won't develop a treatment for a rare disease at all because it's just not worth it...

Which is exactly the problem. And it's even worse than that, because it's a global market with national monopsony buyers. If your country is 4% of the global market, whatever you do isn't going to change the math for the drug company very much and you can ride on the coattails of other countries, so you might as well be as stingy as possible. But then everyone has the same incentive and the net effect is tragedy of the commons.

Or in practice, the US disproportionately funding drug development for the whole world and then people from other countries criticizing them for having higher drug prices.

That's not the real price in the UK because manufacturers will negotiate a confidential price with NICE.

And the quoted price is not the price insurers pay in the US either.

As someone who has worked in this space, the EU is lower than the US, but for oncology drugs the difference isn't that large.

NHS is approximately a monopsony, which probably has some advantages for price negotiation.

A family member has had immunotherapy on the NHS and it was disclosed to them (not sure how reliable or accurate this is) that a single dose cost the NHS 4 figures. It needed several layers of approval for it to be administered.

For one of the same drugs discussed above by Traubenfuchs? If so, unless I've misread the discussion, that looks like 12-140 times cheaper depending on which drug and exactly where in the 1000-9999 GPB it was?

Prices in earlier comment are per year, prices the NHS paid were per dose. Do we know how many doses per year?

Indeed it was per dose, and IIRC the figure was over £5000. It wasn’t intended to be public knowledge, I don’t think the patient was supposed to be shown it. The various supporting chemos ranged from below £100 to about £250/dose IIRC.

I mention it because in the UK people don’t really understand that drugs can be really expensive. The assumption is that due to the scale of the NHS they’re heavily discounted or even free, and that the high prices mentioned by US folk is due to the unusual healthcare situation there.

But there’s real money being paid by taxes, as well as procedures that determine whether you’re worth the expenditure.

I'm sure some (many) make that kind of mistake, so it is worth pointing out.

But also:

> and that the high prices mentioned by US folk is due to the unusual healthcare situation there.

Are they wrong? I keep hearing that the US government spends more per person on healthcare than the UK government, even though the US also has mostly private insurance on top of that and the UK mostly doesn't?

Not wrong at all.

The NHS probably does barter discounts. But consider that a discount of 50% off $150k/yr would be incredible, yet still be a vast amount of money for a single treatment.

>It wasn’t intended to be public knowledge

The price the NHS pays for drugs is published in the BNF.

Thanks! That means I did misread.

Sticker price varies by country, and national health systems can negotiate those prices with quite a bit of market power.

https://www.pgpf.org/blog/2022/11/how-much-does-the-united-s...

> According to a 2021 study by the RAND Corporation, a non-profit global policy think tank, prices of prescription drugs in the U.S. are 2.4 times higher than the average prices of nine other nations (Austria, Australia, Belgium, Canada, Germany, Japan, Sweden, Switzerland and the United Kingdom). That higher cost is largely related to brand-name drugs, which are 4.9 times more expensive in the U.S. than in those countries. In fact, brand-name drugs are responsible for 84 percent of total drug costs in the United States despite accounting for only 8 percent of drugs dispensed.

The US is just starting to negotiate pricing, beginning with ten specific drugs. Until 2022, it was illegal for Medicare to do so.

https://www.hhs.gov/about/news/2023/10/03/biden-harris-admin...