Making outcome-based payment a reality in the NHS: Phase 1

Chemotherapy medication

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If England's National Health Service (NHS) links the price paid for a cancer medicine to the outcomes it achieves in routine practice, it will be important to understand the patients' and carers' desired outcomes.

In this first phase of a wider study into outcome-based payment, researchers found that cancer patients prioritise survival, but also other outcomes. As such, the team recommends four types of outcome measures as standard: survival; disease progression, relapse or recurrence; long-term side effects; and return to normal activities.

Because outcome-based payment schemes are most desirable when there is uncertainty about outcomes even after clinical trials, they are likely to be suitable for some, but not all, new medicines.


There is often a difference between the efficacy of a medicine seen in clinical trials (does the drug work under ideal conditions?) and its effectiveness when it is used routinely in real world practice (does the drug work in a real-world health care environment?). This potential efficacy-effectiveness gap is what drives the need to generate real world evidence, and what makes it attractive to link the price paid for a medicine to the outcomes it achieves in routine practice. This link is known as outcome-based payment (OBP) for medicines. OBP provides the opportunity to ensure payment is aligned with effectiveness in the real world.


RAND Europe and the Office of Health Economics (OHE) were commissioned by Cancer Research UK and Greater Manchester Health and Social Care Partnership to explore the feasibility of introducing OBP for new cancer medicines in the NHS, focusing on the kinds of outcomes that patients and their carers consider most important to refer to in this context. The objectives of this first phase of the research were to:

  • produce a body of evidence to underpin criteria to evaluate the real-world benefit of a new cancer drug, taking particular account of the views of patients;
  • define these criteria, which will provide a benchmark for future OBP schemes for cancer drugs; and
  • produce pragmatic evidence that is transferable to the NHS setting – taking into consideration the existing capabilities in NHS and UK datasets, as well as the potential for future indicators to be developed.


This first phase of research was undertaken through two literature reviews (of cancer outcomes and of pricing schemes internationally), interviews with key stakeholders and experts in the field, as well as engagement with patients through focus groups and a patient-focused survey.


OBP schemes are feasible when there is uncertainty

OBP is most relevant where uncertainty remains about the effectiveness of medicines even after clinical trials. In such cases, linking the price of a medicine to the outcomes achieved in routine practice could allow patients access to medicines much sooner.

OBP is likely to be desirable for some, but not all, new medicines

OBP could be desirable where a more traditional payment approach cannot be agreed upon between NHS England and the manufacturer of the medicine, but where there is the potential of it being proven sufficiently beneficial to justify reimbursement.

Cancer patients’ views show they prioritise survival but also other outcomes

Survival and the avoidance of relapse or disease progression are objective outcomes that are possible to measure for use in OBP schemes. Other outcomes were considered important by patients too, such as avoiding unpleasant side-effects and being able to return to normal activities.

Collecting outcomes data is a challenge that can be overcome

Objectivity of outcome measures and simplicity of operation are important for OBP schemes. Collecting data to measure outcomes other than survival entails staff time and hence cost. However, such data challenges and costs are surmountable when the benefit for doing so is big enough. The higher the potential value of the medicine and the greater the uncertainty about its outcome, the more attractive OBP becomes.


  • Stakeholders should continue to explore the use of OBP schemes, with the aim of facilitating patient access to cancer medicines in cases where a simple discount on the medicine’s list price cannot be agreed on a timely basis. Conversations should be taken forward on a joint basis, through forums and initiatives such as the Accelerated Access Collaborative.
  • Stakeholders should work together to horizon scan medicines nearing regulatory submission that may be suitable for OBP. These would likely be medicines with high potential benefit to patients, as well as a small sized patient population, immature clinical trials data and a disease profile that allows measurable outcomes in the short term.
  • For future OBP schemes between NHS purchasers of cancer medicines and manufacturers, specific metrics should be included to measure the drug’s effects on patients. We recommend four types of outcome measures as standard: survival; disease progression, relapse or recurrence; long-term side effects; and return to normal activities.
  • Future research into the use of OBP in the NHS should investigate with NHS staff the practicalities of collecting data for an OBP scheme, based on exemplar medicines and for measures of the four outcome types mentioned earlier.