A pharmaceutical company submits evidence to NICE showing that its new cancer drug extends median survival by 3 months at a cost of $150,000 per patient. The ICER is $200,000/QALY, well above NICE's standard threshold of £20,000-30,000/QALY. Under what circumstances might NICE still recommend the drug?
ANever — if the ICER exceeds the threshold, the drug is rejected
BNICE may apply end-of-life criteria (short life expectancy, life-extending treatment, small patient population) that allow a higher effective threshold, or negotiate a confidential price discount that brings the ICER below threshold
COnly if the manufacturer lobbies Parliament successfully
DIf patient advocacy groups generate sufficient media pressure
NICE uses modified criteria for end-of-life treatments: if the condition is terminal (life expectancy < 24 months), the treatment extends life by ≥ 3 months, and the patient population is small, NICE may weight QALYs gained by up to 1.7×, effectively allowing ICERs up to about £50,000/QALY. Additionally, confidential patient access schemes (managed access, outcome-based contracts) can reduce the effective price. The process is flexible within principled boundaries — it does not mechanically reject everything above threshold, but any exception must be justified through explicit criteria.
Question 2 True / False
HTA bodies evaluate the same drug and reach different conclusions in different countries (e.g., approved in the UK but rejected in Canada). This inconsistency proves that HTA is arbitrary.
TTrue
FFalse
Answer: False
Different conclusions reflect different thresholds, different healthcare system contexts, and different societal values — not arbitrariness. Countries set different willingness-to-pay thresholds reflecting their wealth, healthcare budgets, and political preferences. The evidence base may also differ (different comparators in different markets, different patient populations). Furthermore, budget impact — the total cost relative to the national health budget — varies by country. HTA is a structured decision process within a specific national context; different contexts legitimately produce different decisions.
Question 3 Short Answer
Explain why budget impact analysis is a necessary complement to cost-effectiveness analysis in HTA, even when the ICER is favorable.
Think about your answer, then reveal below.
Model answer: An intervention can be highly cost-effective (low ICER) but still unaffordable if the eligible patient population is large. A treatment costing $50,000/QALY is cost-effective by most thresholds, but if 1 million patients are eligible, the total budget impact is $50 billion — potentially unaffordable. Budget impact analysis evaluates whether the healthcare system can absorb the total cost of adopting the technology over a defined time horizon (typically 3-5 years), considering the existing budget, displacement of other spending, and the rate of uptake. Both cost-effectiveness and affordability must be assessed for a responsible coverage decision.
This is why HTA bodies consider budget impact separately from cost-effectiveness. A breakthrough gene therapy might be cost-effective per patient but have a total budget impact that crowds out other valuable care. Some systems use budget impact thresholds or installment-based payment models (annuity payments for gene therapies) to manage affordability while preserving access to cost-effective innovations.