Plain English Summary

An important question for health systems is how much they should pay for new pharmaceuticals. Paying more for new drugs may increase incentives for manufacturers to invest in to researching and developing more new drugs. However, devoting more NHS budget to new drugs means that these monies are not available to address other health priorities. 

In this research we seek to provide empirical evidence about how new pharmaceuticals contribute to health and health care expenditure. This will include consideration of how prices of medicines are expected to change over time. This is important as though new drugs are often initially very expensive, once their patent runs out, much cheaper versions called “generic” medicines are often available. The research will provide estimates of the long-term overall benefits of new medicines to NHS patients, accounting for how medicines expenditure impacts delivery of other care in the NHS. It will also quantify how much of the overall benefits of new medicines accrue to patients and how much of the benefits accrue to the pharmaceutical industry. 

We will develop a framework to estimate the long-term impact of pharmaceutical spending on population health. We will then use this to estimate the value of some specific new drugs and how this value is shared between patients and the pharmaceutical industry. The analysis will use data from publicly available research papers, government reports and datasets.

This research will provide important information about the value of spending money on new medicines within the NHS. This is expected to help us understand whether the NHS could improve the way it pays for new medicines.