Spotlight on OHE: Innovation, Regulation and Antibiotics

OHE long has been involved in analysing the nature of innovation and the effects of regulation. Two recent OHE presentations address the core issues.

Incentives for innovation in antibiotics

The growing crisis of antibiotic resistance and the spread of ‘superbugs’ has spurred governments worldwide to seek approaches for encouraging innovation in antimicrobials. In his presentation at the 2014 One Bug, One Drug conference, OHE’s Jorge Mestre-Ferrandiz outlined the economic forces that influence whether innovation occurs and what it targets. He argued that specific measures, particularly public incentives, are important in encouraging the pharmaceutical industry to devote the extensive resources necessary to develop new treatments in some disease areas, such as orphan diseases, and some therapeutic areas, such as antibiotics. For orphan diseases and antibiotics in particular, one problem is low return on investment.

Incentives for innovation are either ‘push’ or ‘pull’ in nature. Push incentives include funding and other inducements for undertaking development; pull incentives provide assurance that a market will exist for the medicines produced. Orphan drug legislation in the US and the EU combine aspects of both push and pull and, despite imperfections, unquestionably have made a difference.

Antibiotics are less attractive targets for pharmaceutical companies than some other therapeutic categories because income from antibiotics usually is less. In a sense, then, antimicrobials is an ‘orphan’ therapeutic area. Recently, the US and EU each have introduced push incentives for antibiotic R&D, including funding and changes in regulatory requirements, but pull incentives are far fewer and have been limited primarily to market exclusivity, in the US. What is needed, the presentation concludes, is an ‘insurance-type’ model coupled with pricing that can reduce the barriers erected for both payer and innovator by uncertainty and risk.

For additional information, please contact Jorge Mestre-Ferrandiz.

Blog posts describing OHE research and analyses on innovation and antibiotics are available by clicking here.


Understanding the connection between regulation and innovation

The Regulatory Policy Institute, based in Oxford, holds an annual conference on competition and regulation. At this year’s conference, OHE’s Jon Sussex described how the prescription medicines market in England is regulated for innovation.

The regulatory problem for the pharmaceutical market is different from that for utilities markets, transport, financial services and indeed markets for all other types of goods and services. The source of the regulatory problem for prescription medicines in the NHS is that the consumer (patient) neither decides which medicine is prescribed nor is responsible for paying for it. For other goods and services, the consumer decides and pays, as well as consumes. In the pharmaceutical market under the NHS, it is the payer that effectively decides the value of an innovation, not the patient.

The cost and risk in drug development are high. To determine how best to target its R&D efforts, the pharmaceutical industry needs clear signals about what innovation the health care payer, the NHS, values. The recent history of such signalling has been dominated in England by the actions of the National Institute for Health and Care Excellence (NICE), whose assessments also have considerable influence internationally. Moreover, although England represents only 2% of the world pharmaceutical market, its prices are used as a reference for pricing in other markets.

How NICE expresses the value of medicines can be viewed as the NHS’s way of regulating innovation in prescription medicines. NICE bases its decisions about value on the incremental cost to the tax-funded health and social care services of the additional quality-adjusted life years (QALYs) a new medicine offers to patients. During the last year, NICE has been consulting on ways to broaden its assessment of value, particularly on whether to take account of the burden of disease and wider societal impacts beyond QALYs. But no decisions are close to being made and the signal to potential pharmaceutical innovators remains fuzzy.

For additional information, please contact Jon Sussex.

Blog posts about OHE research examining NICE’s decision making approach and its effects are available by clicking here.


Cost Savings from Treating Obstructive Sleep Apnoea: OHE Consulting Report

The British Lung Foundation commissioned OHE Consulting to undertake an analysis of the costs of obstructive sleep apnoea and the economic benefits of treating it. The results are summarised below.

Obstructive Sleep Apnoea: Health Economics ReportObstructive sleep apnoea (OSA) is the temporary cessation of breathing during sleep because of a narrowing or closure of the pharyngeal airway. It produces episodes of brief awakening from sleep as the body seeks to restore normal breathing. Although severity varies, untreated OSA can result in daytime sleepiness that affects cognitive function, mood and quality of life. Research has shown that this, in turn, can increase the risks of road traffic and work-related accidents, as well as cardiovascular disease and stroke from associated hypertension.

Currently, an estimated 1.8 million people in the UK are living with OSA, 1.5 million of them adults. Risk factors for developing it are gender (more likely in men), age (more likely in older people), diabetes, hypertension and obesity. These risk factors are expected to increase in prevalence, most likely producing a consequent increase in the costs of OSA as well.

Treatment for OSA varies with disease severity—mild, moderate or severe—and ranges from lifestyle changes and use of dental/oral devices to the use of continuous positive airway pressure (CPAP) machines. In 2008, NICE assessed three interventions and recommended the use of CPAP machines for adults with moderate or severe OAS, but recommend use in milder cases only if other options had failed or were inappropriate. NICE estimated the cost of treating OSA with CPAP at £5,000 per QALY, well below its ICER of £20,000–£30,000.

As the OHE Consulting report points out, other research has found that oral devices are preferred by some patients—particularly those with milder disease—and, while less cost-effective than CPAP machines, are cost effective compared to no treatment. Research on lifestyle changes, possibly appropriate for milder cases, is inconclusive at this point.

Despite the clear evidence of benefit, the report notes that recent research estimates that about 85% of OSA cases currently are undiagnosed and untreated in the UK. In this report, OHE Consulting calculates the direct savings that could be realised if more cases were treated. For example, increasing diagnosis and treatment rates from the current estimated 22% to 45% of people with OSA could yield annual savings of £28 million for the NHS and generate 20,000 additional QALYs; treating all people with moderate to severe OSA could produce an estimated £55 million in annual NHS savings and 40,000 QALYs compared to a situation where people with OSA are not treated or not diagnosed. The cost of not treating people with moderate-to-severe OSA, then, substantially exceeds that of treatment.

Indirect costs also could be reduced by treating a larger proportion of people with OSA. If all those estimated to have moderate to severe OSA in the UK were treated, approximately 40,000 road accidents could be prevented each year, reducing consequent injuries and fatalities. Work productivity also would likely increase and work-related injuries decrease.

An important complicating factor in increasing treatment rates is that the geographic distribution of people with OSA coincides poorly with the availability of diagnosis and treatment centers. For example, services are scarce in rural areas, where OSA is likely more prevalent as the population tends to be older than in urban areas. In addition to discouraging wider treatment, this mismatch undermines equity in access to care.

As the report notes in conclusion, much remains to be learned about OSA’s full range of causes and effects as well as the effectiveness, and cost effectiveness, of alternative interventions. A brief outline of needed research is included in the report.

For additional information, please contact Jon Sussex at OHE. For information about OHE Consulting and its services, please contact Jorge Mestre-Ferrandiz.

Download: Rejón-Parrilla, J.C., Garau, M. and Sussex, J., 2014. Obstructive sleep apnoea: health economics report. Consulting Report. London: Office of Health Economics.



Competition and Outcomes in the NHS: Hip Replacement

Discussed yesterday at an OHE Lunchtime Seminar is a new journal article that explores the possible connection between hospital competition and outcomes for non-emergency hip replacement surgery in England.

As the authors[i] note, ‘Health care reforms in England during the last decade have been influenced by the idea that encouraging competition between hospitals, with nationally fixed prices, will increase the quality of care for patients’. Indeed, some research has found a positive connection between competition and outcomes, although the methods and assumptions of some earlier studies have been questioned.

A principal criticism of earlier studies concerned the measures of quality of care that were used. This new analysis benefits from the NHS Patient-Reported Outcome Measures (PROMs) data, collected in England since 2009 for all NHS-funded surgeries for four elective procedures. The current study focuses on one of those: elective hip replacement. PROMs data are collected both before and after treatment, indicating the extent to which the surgery produces improvement in patients’ self-reported health status. Changes in patients’ hip-related health is measured using the Oxford Hip Score.

Following an approach common in the literature on competition, hospital market concentration is used as an indicator of competition, i.e. more hospitals providing care to residents of a geographic area can be expected to create greater competition. Data were collected for 2011–12 for all English NHS hospitals and all elective primary hip replacements. In the analyses, adjustments were made to control for characteristics of patients and/or hospitals that might confound the results.

The ‘key finding’ from the study, the authors state, ‘is that we found no statistically significant association (at the 5% level) between hospital market concentration and the improvement in health of hip patients after surgery’. However, for the 50% of hip patients with less severe problems, greater concentration of hospitals was associated with slightly better patient reported outcomes at the 10% significance level. This indicates that it would be desirable to investigate further with additional years’ data, which the authors intend to do.

This project was funded jointly by the Office of Health Economics and the Nuffield Trust. For additional information, please contact Yan Feng at OHE.


[i] Open access: Feng, Y.(a), Pistollato, M.(a), Charlesworth, A.(b), Devlin, N.(a), Propper, C.(c,d), and Sussex, J.(a), 2014. Association between market concentration of hospitals and patient health gains following hip replacement surgery. Journal of Health Services Research & Policy. Published online before print. doi:10.1177/1355819614546032.  (a)OHE; (b)The Health Foundation; (c)Imperial College London; (d)University of Bristol


Generating EQ-5D-5L Values in the UAE with TTO and DCE: Initial Results

Shah and Papadimitropolous with TTO / DCE poster

Shah and Papadimitropolous at ISPOR Asia Pacific

As reported in this blog in November 2013, OHE’s Professor Nancy Devlin and Koonal Shah have been working on-site in Abu Dhabi to establish a new programme to measure and value health in the United Arab Emirates (UAE). The project is being undertaken in collaboration with the United Arab Emirates University and Eli Lilly & Company, which is funding the project. The first results were presented at the 6th ISPOR Asia-Pacific Conference in September 2014 (see poster below).

In the Middle East, public preference data are gaining in importance as a basis for deciding about drug coverage. The first results of this joint project report on the feasibility of using time trade off (TTO) and discrete choice experiments (DCE) in the creation of EQ-5D-5L value sets for the UAE. Interviews of the general public generated a sample of 200 responses, although young and highly educated individuals were overrepresented.

These initial findings show that cultural beliefs complicated the collection of data for TTO, as the concept of ‘worse than dead’ (WTD) proved difficult to explain to some respondents. Differences between this survey and those in Western countries such as England included fewer health states being rated as WTD in the UAE and greater concern about mobility in the UAE than about anxiety/depression. However, the face validity of the TTO data appeared to be reasonably high, with higher values elicited for mild health states and lower values for severe health states. No problems were encountered with the use of DCE.

The authors conclude that meaningful health-state valuation data can be collected in the UAE, but that some adaptation of TTO methods may be necessary.

Papadimitropoulous, M., Elbarazi, I., Blair, I., Katsaiti, S., Shah, K. and Devlin, N., 2014. An investigation of the feasibility and cultural appropriateness of using time trade off (TTO) and discrete choice experiments (DCE) to generate EQ-5D-5L values in the United Arab Emirates. Poster presented at 6th ISPOR Asia-Pacific Conference. Beijing, China. 6-9 September 2014.



Annual Lecture 2014: Is Universal Health Coverage the Holy Grail?

Anne Mills Annual Lecture on Universal Heath Care

Towse, Mills, Drummond

Each year, the OHE sponsors a lecture that explores a timely issue in medicine or health economics. At the 22nd Annual Lecture, held in June 2014, the issues and challenges of universal health care coverage in low- and middle-income countries were presented by Professor Anne Mills of the London School of Hygiene and Tropical Medicine. What follows is a brief summary of her remarks.

Universal health coverage[1] (UHC) in developing countries currently is the topic of intense debate in the global health community. With the Millennium Development Goals set to expire in 2015, momentum is growing towards making universal coverage a key global goal. At the World Health Assembly in 2014, the Director General of the WHO suggested a target of 80% effective coverage for key health services for all population groups within each country by 2030.

In part, the focus on UHC is a response to the concerns about the unintended consequences of the large increase in development assistance for health since the early 1990s. Most such assistance focused on specific diseases or disease areas, but neglected development of national health care infrastructures and sustainable financing systems. Access to care continues to be a serious challenge in low- and middle-income countries (LMICs), with comparatively high out-of-pocket payments still posing a serious problem.

To achieve UHC, countries must solve the puzzles created by three core challenges: sufficient and stable financing, reliable and effective financial intermediaries, and a sufficient supply of competent service providers.


The greatest challenge is coverage for low income workers and the self-employed — usually a large portion of the working-age population — and those outside the workforce, i.e. the young, elderly, disabled and unemployed. A mix of financing approaches and sources currently are used in the LMICs, including: social health insurance, general taxation, voluntary contributions and out-of-pocket payments. The particular mix varies by country; evidence is not yet available to suggest which specific mix may be most effective in a particular setting. However, experience does suggest that a core mandatory financing mechanism is essential – either social health insurance or general tax revenues.

Financial intermediaries

Issues include whether systems should be single payer or allow more than one fund, and what the role of the private sector should be. Multiple funds can produce inequities, but many countries still use a mix. Although the public sector is the traditional intermediary, more countries are experimenting with a mix of public and private, contracting with private companies to manage arrangements. India’s RSBY, for hospital coverage, is an example.

Service providers

To achieve UHC, the first concern should be care for those most vulnerable, i.e. the poorest sectors of the population. This requires, of course, that sufficient services be available in the appropriate locales, not just in the larger cities. Discussion of financing issues, especially insurance options, too often tends to eclipse the essential focus on extending service provision. Ensuring access to both primary and hospital care, and integrating the two, remains problematic. Providers may be either public or private, although the private sector is expanding and, with greater resources, often has superior infrastructure.

Research most often focuses on the evaluation of performance in relation to the design features of UHC, but just as important are the institutional underpinnings of UHC. More attention needs to be paid to what political, economic, social and cultural institutions might allow government to pursue and make progress towards UHC. This includes an effective civil service with recruitment and tenure based on merit; ensuring that the voice of those less well off are heard and factored into policy debates; incentives to encourage those better off to remain in the system, along with evidence of the impact of this; and sufficient social solidarity to support cross-subsidisation of income groups.

It is critical to put the necessary elements of UHC in place early on because it can be politically difficult to make changes later. Four elements are particularly important:

  1. A combination of financing sources
  2. Strong purchasing arrangements that make use of both public and private providers and include an emphasis on health promotion and disease prevention
  3. A payment system that includes incentives for both cost containment and quality of care
  4. Strong primary care and local-level infrastructure with appropriate geographic spread.

The evolution of health care systems towards UHC is, and will continue to be, very country-specific; what works in one simply may not work in another. Whatever the system or ideology, however, a strong government role is necessary, even if the government is not the only actor.

Although discussions — and the movement towards adopting UHC as a global goal — may suggest the opposite, it is crucial to understand that UHC is a process over time, not a fixed point that can be achieved once and for all.

[1] WHO defines universal health coverage as ‘ensuring that all people can use the promotive, preventive, curative, rehabilitative and palliative health services they need, of sufficient quality to be effective, while also ensuring that the use of these services does not expose the user to financial hardship.’

For audio recording of the entire lecture, click here

About Professor Mills

Professor Anne Mills CBE MA DHSA PhD FMedSci FRS is a world renowned expert in health economics, health care financing and policy in low- and middle-income countries.

She has a distinguished academic career at the London School of Hygiene and Tropical Medicine, where she is Vice Director of the School and Professor of Health Economics and Policy in the Department of Global Health and Development. She previously served as Director of the Health Economics and Financing Programme, which was supported by a variety of research grants from funders such as DFID, the Wellcome Trust, EU and WHO, and as the Head of the Faculty of Public Health and Policy. She has advised many multilateral, bilateral and government agencies; served on the WHO’s 2001 Commission on Macroeconomics and Health chaired by Jeffrey Sachs; and co-chaired one of the two Working Groups for the 2009 High Level Taskforce on Innovative International Finance for Health Systems, co-chaired by Prime Minister Gordon Brown.

In 2006 she was awarded a CBE for services to medicine and elected a Foreign Associate of the US Institute of Medicine. In 2009 she was elected Fellow of the UK Academy of Medical Sciences and received the Prince Mahidol Award in the field of medicine. She was President of the International Health Economics Association (iHEA) for 2012/13. She was elected a Fellow of the Royal Society in 2013.

This Annual Lecture will be available as a publication and, as for previous years, will be available for download from the publications section of this website. To view blog posts about earlier OHE Annual Lectures, click on the Annual Lecture tag in the right column of this blog.




What Determines the Shape of an EQ-5D Index Distribution?

What Determines the Shape of an EQ-5D Index Distribution? Parkin, Devlin and FengIn a new OHE Research Paper, OHE’s Nancy Devlin and Yan Feng join David Parkin from King’s College London in analysing characteristics of the EQ-5D indexing process that may obscure useful, and important, information about health states.

Because the EQ-5D is one of the most used health-related quality of life instruments worldwide, it is crucial that the characteristics of the data be well understood. The EQ-5D is used to ask patients or others to self-report their health in terms of five dimensions and three levels of problems (‘no’, ‘some’ or ‘extreme’). That information from patients is then summarised by a single number, anchored at 0 (dead) and 1 (full health) to show how ‘good’ or ‘bad’ each state is. The authors of this paper note that distributions of EQ-5D index values in patient and general populations have an interesting characteristic: they typically divide into two distinct groups. This might reflect the actual distribution of ill health, but it also might be an artefact of how the EQ-5D index is constructed.

In this OHE Research paper, the authors examine the determinants of the shape of EQ-5D distributions, particularly the origins of the ‘two groups’ distribution. They analyse data from elective English NHS surgery patients (hip and knee replacements, and varicose vein and hernia repairs) and a study of primary care patients with chronic disease (asthma and angina). The distributions of EQ-5D index values are compared to distributions based on data that have not been weighted; with the distributions that arise when different countries’ weights are used to summarise patients’ data; and with condition-specific indexes for the same patients.

The research shows that a very small number of profiles account for most of the observed data: just twelve EQ-5D health state profiles account for 86% of all the health states reported by patients. The explanation for the ‘two groups’ characteristic seems to lie both in the grouping of profiles and in the nature of the weights applied to them. Examining the group with higher index values, the most commonly observed health states all had ‘some’ problems with mobility, usual activities and pain, and had either ‘no’ or ‘some’ problems with self care and anxiety/depression. In the group with lower index values, the most commonly observed health states all had ‘extreme’ problems with pain/discomfort and some also had the worst level of usual activities. The weights commonly used to calculate the index place more weight on level 3 health problems, creating a noticeable gap in index values across the two groups.

The authors also show that the ‘two-groups’ characteristic of EQ-5D index distributions is not uniquely associated with the use of the UK value set. Applying different value sets produces different distributions, but the two-group distribution arises in most cases. However, the difference between the distributions in each case serves as a reminder that, for any given set of patients’ EQ-5D data, which value set is used to summarise them will have an important bearing on the results.

The authors point out that concentrating on the EQ-5D index may obscure useful information about health states and possibly produce misleading information. They emphasise the importance of exploratory analysis of EQ-5D data — both to improve analyses of EQ-5D data for comparison and inference purposes, and to help develop more accurate mapping across different health measures. Any health status index based on weighted profiles, the authors note, will benefit from this analytical approach.

Download Parkin, D., Devlin, N. and Feng, Y., 2014. What determines the shape of an EQ-5D distribution? Research Paper 14/04. London: Office of Health Economics.

For further information, please contact Professor Nancy Devlin. For an overview of OHE’s extensive activities in patient-reported outcomes measures, please click here.


Bengt Jönsson Honoured for Contribution to Health Economics

Portrait of a Health Economist -- Bengt JonssonLaunched at a seminar in his honour May 2014, Portrait of a Health Economist: Essays by Colleagues and Friends of Bengt Jönsson is an impressive collection of essays commemorating Bengt’s lifetime contribution to health economics. He was one of the true pioneers in the field – his 1976 doctoral thesis was on cost-benefit analysis in public health and medical care. He has since published hundreds of papers, reports and book chapters worldwide. In 1979, Bengt founded the Swedish Institute for Health Economics (IHE), using the OHE as a model, and in 1982 became professor of health economics at the University of Linköping, where he founded the Center for Medical Technology (CMT). IHE and CMT today are the focal institutions for health economics in Sweden. In 1991, Bengt moved to the Stockholm School of Economics, where he is now Professor Emeritus and remains as active as ever. He joined the OHE Policy Board[1] in 2007.

Edited by Tony Culyer and Gisela Kobelt, the book’s list of contributors reads like a worldwide who’s who of experts in the field, including OHE Policy and Editorial Board members Martin Buxton, Tony Culyer, Mike Drummond, and Peter Zweifel, as well as past OHE Annual Lecturers Bob Evans, Uwe Reinhardt and Milt Weinstein. The thirty chapters address a range of topics including: health economics and politics; the theory underlying the design of health economic evaluation and its use in decision making; specific analytical techniques and approaches, e.g. QALYs; appropriate use of cost effectiveness analyses in health care decision making in general, in specific countries or to meet specific goals such as designing a benefits package; the health economics of particular diseases, e.g. diabetes and cancer; and chapters specifically on aspects of Bengt’s contributions to the field.

The chapter contributed by OHE’s Adrian Towse[2] discusses Bengt’s observations in a 2011 publication[3] about the role of relative effectiveness research (RE) in the European medicines market. To ensure value for money, understanding actual use of medicines in the health care system is an essential supplement to information from clinical trials. To move in this direction, Towse defines a deceptively simple challenge: creating an environment where choice of therapy is based on an optimal amount of evidence from relative effectiveness research that is generated and used efficiently across health care systems. He identifies three sets of changes that must occur to meet the challenge:

  1. A new drug development paradigm supported by regulatory authorities, HTA agencies and pharmaceutical companies that encourages the efficient collection of RE data before and after a medicine reaches the market
  2. Concerted efforts to eliminate the currently costly duplication across countries in infrastructure and RE-based assessments
  3. Understanding how and how well individual health systems use and benefit from new medicines, both to identify when expected differences mean country-specific RE may be needed and help identify instances where health systems use treatments inefficiently.

Towse notes that ‘appraisal of RE evidence should edge both parties towards efficient pricing and use of a new drug’, (p. 185), which he believes EU reforms can encourage in various ways. He is somewhat less optimistic about trans-Atlantic convergence.

[1] OHE’s Policy Board provides advice and guidance on OHE’s research programmes. A full list of current Policy and Editorial Board members is available here on our website.

[2] Towse, A., 2014. Comparative and relative effectiveness: a challenge for health systems, regulators, or the pharmaceutical industry? In Culyer, A.J. and Kobelt, G. eds. Portrait of a health economist: essays by colleagues and friends of Bengt Jönsson. Lund: Swedish Institute for Health Economics, pp.179-188.

[3] Jönsson, B., 2011. Relative effectiveness and the European pharmaceutical market. European Journal of Health Economics. 12(2), pp.97-102.

The book may be downloaded as a pdf from the website of the Swedish Institute of Health Economics.





Spotlight on OHE: Competition in the NHS, HESG, Publications

OHE was active in several forums in June. This blog post summarises the highlights.

Competition in the NHS

Jon SussexJon Sussex was a keynote speaker at the Capita conference on competition in health care held in June, where the audience was primarily from the NHS. Jon’s presentation summarised the state of provider competition in the NHS to date as well as national and international evidence about the impact of competition on quality. Competition would be important for some services, Jon noted, but unimportant for others. Assessing the feasibility of competition is essential using, for example, the framework developed by the OHE Commission on NHS Competition.

OHE at HESG: Health Care Decision Making, Hospital Market Concentration

The Health Economists’ Study Group (HESG) was founded in 1972 to support and promote the work of health economists. Its members are from academic, commercial, and government settings. The purpose of HESG is to transmit knowledge and ideas, ranging from the theoretical to very practical policy issues. HESG meets twice a year, most recently in June 2014.

Two OHE papers were discussed at the most recent HESG meeting.

  1. A paper by Karla Hernandez-Villafuerte and Jon Sussex that sets out a preliminary model intended to characterise the behaviour of decision makers in the health sector who must make choices based on budget constraints set by government or another health system authority. Specifically, the model focuses on the options available when use of new health technology is mandated.

See also the recent OHE Research Paper Opportunity costs of implementing NICE decisions in NHS Wales.

  1. A paper co-authored by Yan Feng, Michele Pistollato, Anita Charlesworth, Nance Devlin, Carol Propper and Jon Sussex that assesses the relationship between market concentration in hospital care and health gains as reported by patients following primary hip replacement surgery. This research is a joint project of OHE and the Nuffield Trust.

June Publications

In June, OHE welcomed two new members to its team, Dr Amanda Chapman and Grace Marsden. Shortly after beginning her position at OHE, a paper on which Amanda is lead author appeared online in Applied Health Economics and Health Policy. The article is based on Amanda’s work on medical devices while at the University of Birmingham and assesses the effect of NICE’s Medical Technologies Evaluation Programme over its first three years of operation[1].

Also just published online is an article by Karla Hernandez-Villafuerte on age and inequalities in access to care[2].

To inquire further, please contact the relevant OHE team member by visiting the About Us section of the website.


[1] Chapman, A., Taylor, C.A. and Girling, A.J., 2014. Are the UK systems of innovation and evaluation of medical devices compatible? The role of NICE’s Medical Technology Evaluation Programme (MTEP). Applied Health Economics and Health Policy. DOI: 10.1007/s40258-014-0104-y.

[2] Hernandez-Villafuerte, K., 2014. El adulto mayor y la universalidad de la salud: Análisis de desigualdad basado en una comparación entre los diferentes grupos de edad. Estudios de Economia Aplicada. [Available in Spanish only.]



Interdependencies in Funding Medical Research in the UK

Exploring the Interdependencies of Research Funders in the UKCancer Research UK has recently released a report completed for it by OHE and the Science Policy Research Unit (SPRU) at the University of Sussex that focuses on the strength and nature of interdependence in the funding of cancer research.

As earlier OHE research has demonstrated, sources of funding for medical research—public, charity and private sector—are complementary in effect, not duplicative. The three sectors also differ in their approaches; reduced funding from one would not only decrease the overall financing available, but also change the nature of the research effort overall. This is a concern given that austerity in government spending in the UK is likely to continue for some time.

OHE and SPRU produced a report for Cancer Research UK to explore two sets of questions:

  1. What are the differences in the research activities supported by various funders in the UK? How complementary and interdependent are they?
  2. If government funding of life sciences research was cut, what would be the effect on life sciences research in the UK? Could other funders compensate for the loss of funds?

The research for the report included the following.

1.  Economies of scale in charity- and publicly-funded medical research in the UK were explored via a literature review, interviews with major UK medical research funders and analysis of cost data provided by those interviewed.

The study found that economies of scale are relatively modest except when research requires particularly specialized and costly equipment and infrastructure.

2. Analysis of the interdependencies and the differences across the research activities supported by the diverse funders of cancer research in the UK. Research publications were examined to gain an understanding of the importance of funders named or acknowledged, including those from outside the UK.

The study found that funding for two-thirds of projects reported in publications routinely came from more than one funder, just under half had funding from outside the UK, and a fifth received funding from industry. The study’s findings reflect the highly collaborative nature of cancer research, with the majority of papers being produced by teams working across organisations and many relying on international co-authorship ties. These ties leverage thousands of national and international funding sources, large and small, to support the 7% of global cancer publications that the UK produces.

3. To explore the connections between government and charity funding of cancer research in the UK, the study included an Internet-based survey of how changes in government funding might affect the general public’s willingness to donate to cancer research charities.

The study found that the general public would not want public funding for cancer research to be reduced, but would also not donate more to compensate for a reduction.

The report concludes that:

Exploring the interdependencies between different medical research funders, particularly in cancer, provides us with a striking picture of the extent to which research funders contribute together to produce world class research. The findings provide a compelling case for why investment—by all sectors—is needed to allow the UK to maximize its research outputs.

Download Shah, K., Sussex, J., Hernandez-Villafuerte, K., Garau, M., Rotolo, D., Hopkins, M., Grassano, N., Crane, P., Lang, F., Hutton, J., Pateman, C., Mawer, A., Farrell, C. and Sharp, T., 2014. Exploring the interdependencies of research funders in the UK. Research Paper 14/03. London: Office of Health Economics.

For additional information, please contact Jon Sussex at OHE. For earlier OHE research on these issues, click here.

The report is also available on Cancer Research UK’s website.




OHE Consulting Report on the Trajectory of Dementia in the UK

The trajectory of dementia in the UK – making a differenceAlzheimer’s Research UK commissioned OHE Consulting to model the growing prevalence and costs of dementia in the UK and the impact that new treatments could have were they to be introduced from 2020.

Today over 800,000 people aged 60 and over are living with dementia in the UK. The risk of developing dementia increases greatly with age, from around 1% of men and 1.5% of women in their sixties to more than a quarter of men and a third of women aged 90 and over. The ageing of the UK population, then, will mean an increasing number of people living with dementia.

Based on the latest official UK population projections and the most authoritative estimates of the prevalence of dementia, OHE Consulting built a model to project the number of people with dementia in the UK to 2050. The model then was used to project the health and social care costs of dementia. The results show that unless ways are found to prevent or cure dementia, the number or people in the UK aged 60 and over who will be living with dementia is likely to double over the next 25 years and reach two million by 2050.

The economic cost to the UK of caring for people with dementia is estimated to grow correspondingly from £24 billion in 2014 to £59 billion (at constant prices) by 2050. A large part of the cost of care is the time given up by informal carers to look after loved ones with dementia; the UK will need around 1.7 million informal carers by 2050 compared to the around 700,000 currently giving care.

OHE’s model shows how new interventions to prevent and treat dementia could radically change this picture. Delaying the onset of dementia by five years in the UK from 2020 could reduce the projected number of people with dementia in 2050 by one third (666,000) and reduce the need for informal carers by 566,000; costs of care would be £21 billion lower in 2050 (£38 billion rather than £59 billion).

Even if it were not possible to delay the onset of dementia, slowing the rate at which it progresses – from mild to moderate to severe – would bring major improvements in quality of life and less premature mortality from dementia.

Download Lewis, F., Schaffer, S.K., Sussex, J., O’Neill, P. and Cockcroft, L., 2014. The trajectory of dementia in the UK – making a difference. Consulting Report. London: Office of Health Economics.

For additional information, please contact Jon Sussex at OHE.

 For an associated policy report by Alzheimer’s Research UK click here.