James O'Mahony: Cost of new drugs must be balanced with our poor access to entry-level healthcare 

Clinically basic and highly cost-effective elective care in Ireland is being neglected while we maintain an excessively generous threshold for new drugs, writes James O’Mahony of Trinity College.

In the coming weeks you may hear industry lobbyists, patient groups and doctors extolling the need to remain at the forefront of access to new medicines.

The Irish Pharmaceutical Healthcare Association (IPHA) is a powerful lobby representing branded drugs manufacturers in Ireland. For decades it has been an important player in price negotiations over new medicines.

It strikes periodic pricing deals typically lasting three to six years. The IPHA is due to agree a new deal with the HSE and the Departments of Health and Public Expenditure and Reform early this year.

The new deal's timing could not be more challenging. Our health service is still under acute strain from Covid.

Even when the acute phase passes, the hangover of unmet need from more than 10 months of cancelled planned care and suppressed demand will take years to clear.

Similarly, Covid has required enormous additional expenditure from health budgets and public spending in general. All of this comes on top of the HSE's existing poor waiting time performance and regular, large annual overspends.

A key element of IPHA pricing deals is the cost-effectiveness threshold. This is the limit on what the public health system agrees to pay for the equivalent of one year's good health, the QALY. The current threshold is €45,000/QALY.

It is used to decide if new drugs offer sufficient value for money to merit funding. The higher the threshold, the faster we can expect access to more novel treatments and a bigger drugs bill. IPHA will likely press for maintenance of the current threshold.

While the threshold appears to impose a price on life, something many understandably consider unethical and impossible to judge, health economists view it another way: as a rule of thumb to balance the costs of new services with existing care.

James O'Mahony: "Irish electorates have long-known not to expect timely access from the HSE and those with means use private health insurance to skip queues. While a politically convenient solution, this is morally bankrupt."

When we fund new services, there are always other services that we implicitly decide not to fund. In principle, the threshold should represent these other services.

The worrying problem is the current threshold fails to correspond to these other services. Indeed, it is not supported by any evidence at all, but rather is the outcome of industrial negotiation behind closed doors.

I have written academic papers about my concerns that clinically basic and highly cost-effective elective care in Ireland is being neglected while we maintain an excessively generous threshold for new drugs. An excessive threshold that adds expensive, high-tech medicines to an otherwise weak system risks damaging population health, not enhancing it.

A generous threshold is fine if there are no waiting lists for basic services such as hip replacements and knee replacements or cataract removals.

The reality in Ireland is that we have huge and growing lists for such care.

The threshold needs to be tethered back to the reality of poor access in our health system. I and other health economists argue that we need to adopt a lower, stricter threshold.

This is needed to balance spending on new services with ensuring sufficient access to existing care. The pressures of Covid mean the need for a reality check on the threshold has never been greater.

A stricter threshold will mean slower access to new therapies. You can expect doctors and patient groups to complain.

While this might seem penny-pinching by health economists, it is a call for a fair balancing of the needs of patients within the health system. It is unfair and inefficient to press ahead with ground-breaking new treatments when basic care is neglected.

In the coming weeks you may hear industry lobbyists, patient groups and doctors extolling the need to remain at the forefront of access to new medicines.

Do not forget that this cutting-edge access comes at the cost of massive waiting lists for painful conditions for our children, chronic conditions deteriorating unchecked by simple interventions and undignified treatment on trolleys in overcrowded corridors for our older people.

Many reading this will be insulated from the problems of our over-generous threshold. Those services that suffer the most because of our out-of-touch threshold for elective care.

Irish electorates have long-known not to expect timely access from the HSE and those with means use private health insurance to skip queues. While a politically convenient solution, this is morally bankrupt.

Faced with the Covid hangover, the time is nigh to adopt a stricter threshold that reflects the inconvenient truths about access within our health system. It is hoped that this pressing need will not be lost on the new Department of Health interim secretary general, the economist Robert Watt.

• James O’Mahony, Assistant Research Professor, Trinity College Dublin