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Special measures — time for a healthydebate on specials procurementThe way pharmacists source and supply specials is under intense scrutiny as theNHS looks to root out the specials spendthrifts, reports Ailsa Colquhoun

Information and guidance on the prescribingand use of unlicensed pharmaceutical specialsmakes clear that the days of the specialsspendthrift are over. Noting the budget-busting near tripling of NHS spend in thisarea over the past four years, the guidance,published by the East of England NHSCollaborative Procurement Hub in January2010, recommends a number of measuresdesigned to curb inappropriate specials supplyby pharmacies. According to the EECPH’sprocurement project manager StephanieSprakes, this guidance has been widelywelcomed by primary care and other trusts,which are now working to implement itsrecommendations. She says: “The market hasgot to the stage where something has tohappen. This growth in spend cannotcontinue at this rate.” (Panel 1.)

Importantly, these principles are alsosupported by commercial specials suppliers,which welcome a healthy debate on themarket forces at play in specials procurement.Karol Pazik, managing director of MandevilleMedicines, said: “I know that specialsrepresent value for money, but I am notconvinced that pharmacists who supply thosespecials add value.”

Cost-effective supportThe EECPH guidance is primarily designedto act as refresher guidance for healthcareprofessionals on the individual responsibilitiesand the risks involved in prescribingunlicensed medicines, but it also makes nobones about the need to improve the costeffectiveness of specials used in the NHS.Specifically raising the subject of commercialprocurement policies, the document statesthat “pharmacists should avoid manufacturersoffering excessive levels of discount . . . andintermediaries . . . to avoid excessive handlingcosts and mark ups.”

Reference is also made to the newprofessional guidance from the RoyalPharmaceutical Society on supplying specials,which was published in June (Panel 2).

For prescribers, there are also guidelines,such as regularly reviewing the patient’songoing need for a special, and the documentgives explicit examples where specialsprescribing could be improved. Among the“worst offenders”, the EECPH cites thevolumes recently prescribed for phenytoin90mg/5ml, and tacrolimus solutions, despitethe important bioavailability issues (Panel 3).

Finally, for PCTs, the guidance documentsa set of practical actions to support themanagement of specials prescribing in the

areas. Noting that “no one option will delivercomplete control but a range may have aneffect”, the guidance spells out a range ofdemand-side initiatives such as GP incentiveschemes that reduce specials prescribing,specials prescribing authorisation schemesand post payment verification. On the supply

side it mentions a best value list and newarrangements with secondary care. MsSprakes says: “NHS acute trusts canmanufacture some of these medicines at afraction of the price. In this current financialsituation, we have to question why we are notusing that option.”

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The guidance also provides comprehensiveinstructions on using the specials reportingfunctionality of ePACT software. Ms Sprakessays this could help trusts “drill down” intotheir specials spending hot-spots, at specificdrug and individual practice levels. It is theEECPH’s opinion that the costs of specialshave been escalated by “commercialcomplexities in the market”, which include theprice inflation that can occur during thepassage of the product through the supplychain.

She says: “The fact is that specials havebeen allowed to slip under PCTs’ financialradar and, as a result, the market has attracteda large number of companies which haverealised its lucrative potential. But, the fact isthat specials are now on the radar both atnational (prescription pricing authority level)and PCT level.”

She describes the response to the guidanceas “overwhelming and very well received.Trusts are showing a clear demand forsupport in the management of specials.” Suchis the demand for support with themanagement of specials that the work of thespecials sourcing group continues as apriority.

Ms Sprakes says that among the specialsinitiatives also develop ed by her organisationis the online publication of PCT-level spenddata on specials. Preliminary work is alsounder way with the School of Pharmacy atEast Anglia University, which aims to buildgood practice in the supply of specials into thepharmacy undergraduate curriculum.

An NHS-wide focus East of England is far from alone in making astand on specials, and the Quality, Innovation,Productivity and Prevention (QIPP)initiative — postponed from June toSeptember — has already earmarked specialsspending as an area ripe for specificinvestigation. Launching the £20bn medicinesmanagement and procurement efficiencydrive earlier this year, pharmacist Peter Rowesaid that some £50m is currently spent eachyear on specials when a licensed alternativecould be prescribed in its place. The QIPPmedicines workstream lead said: “I cannot seehow you could conceivably justify prescribinga special when there are licensed productswhich, on the face of it, do the same job.”

Specials come in for special attention inproject one of the QIPP primary caremedicines management project. Under theterms of this workstream, QIPP recommendsthat if drugs bill inflation is to be curbed, thereneeds to be:

• General awareness raising on prescribing“specials”

• General guidance for prescribers andcommissioners highlighting the costly natureof specials and guidance on appropriateprescribing

• Recommendations on anynational/structural changes that may berequired to minimise inappropriate use

Taking forward the QIPP workstream, atthe beginning of August NHS chief executive

PANEL 2: NEW RPS PRACTICEGUIDANCE ON SPECIALSRESPONSIBILITIES

Practice guidance from the RoyalPharmaceutical Society outlines the keyprofessional responsibilities for pharmacistsproviding advice on, or supplying specials, andprovides support in making appropriate choicesfor their patients.

The document covers:

• General information about specials• Key professional responsibilities• Assessing clinical need• Choosing a suitable product• Choosing a suitable supplier and placing anorder

• Good record keeping

Additionally, this guidance encouragescommunity, hospital, primary care and industrialpharmacists to engage with one another andwith prescribers to discuss the issue ofspecials.

Prescribers are not always aware they areprescribing a special and therefore will not beaware that as a bespoke special it is likely to bemore expensive to procure than a licensedproduct. This can lead to a more efficientprocurement of specials within the locality

PANEL 1: SPECIALS PRESCRIBED IN ENGLAND AND DISPENSED IN THE COMMUNITY

Items (numbers) Net ingredient costTagged* Other specials Total Tagged Other specials Total

2006/2007 284,881 693,453 978,334 £18,427,807 £43,791,968 £62,219,7762007/2008 389,208 775,064 1,164,272 £40,145,337 £41,848,800 £81,994,1372008/2009 461,578 1,183,379 1,644,957 £67,288,325 £59,289,454 £126,577,7792009/2010 649,682 971,867 1,621,549 £120,060,578 £53,307,922 £173,368,500

*Specials tagged as expensive. Caution is needed when comparing year-on-year growth in tagged items, because this list is extended each year as newmedicines meeting the criteria are includedSource: PACT data analysis by the NHS Information Centre

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David Nicholson wrote to English trustsasking for boards to consider how QIPP’srecommendations can be implemented at trustlevel. Trusts are also asked to give feedbackahead of the publication of the latest NHSOperating Framework in the autumn. Callingfor local trusts to react proactively to thechallenges laid down by QIPP, Mr Nicholsonsaid: “Alongside pandemic flu, this is the mostimportant challenge facing the NHS for theforeseeable future.”

Financial planningQIPP, of course, is just part of an ongoingNHS workstream to curb the spiralling drugsbill — said to be inflating by 14 to 22 per centa year in secondary care — and plenty hasalready been done to improve procurementefficiency across the NHS.

In May 2009, the Department of Healthunveiled plans to boost the commercial andprocurement skills across the NHS in theform of a new commercial operating model.Among the products of this model is thenetwork of commercial support units (CSUs),designed to support NHS health careproviders and service commissioners to helpthem improve their skills, gain better value

from procurement and respond moreeffectively to commercial challenges.Launching the new commercial model, theDepartment of Health director general ofcommissioning and system managementMark Britnell said: “The new commercialoperating model will deliver a step change incommercial capability, raising the standard ofcommercial knowledge at all levels across theNHS. . . . In a colder economic climate, a newcommercial operating model is a necessity, nota nicety or an optional extra.”

The contract conundrumFor specials manufacturers supplyingsecondary care, one of the most importantramifications of the new CSU model has beenthe recommendation that procurement chiefsidentify “the opportunity to develop currentmechanisms to achieve further efficiencies onproviders’ own third-party spend of some £20billion a year.”

According to Bath ASU, a specialscompany specialising in asepticmanufacturing, a manifestation of the newcommercial model has been to increase theuse of longer term contracts; for Bath ASU,over the past four years, this has grown its

PANEL 3: SUMMATIVE REPORT OF PRESCRIBING VOLUMES OF SPECIALS MEDICINES AND PRICES(PACT DATA, ENGLAND, SEPTEMBER 2009)

Formulation No of No of Total cost of Most common No of Average Maximum Minimumprescriptions different all volumes volume scripts cost cost cost

quantities prescribed prescribed forprescribed common

volumeCo-Dydramol_Liq Spec 10mg/500mg/5ml 207 21 £36,298.90 150 58 £112.26 £342.86 £89.97Diazepam_Oral Soln 10mg/5ml 188 24 £20,011.14 200 95 £95.35 £602.41 £7.17Ferr Sulph_Liq Spec 60mg/5ml 183 18 £31,638.07 100 29 £128.72 £409.33 £7.89Omeprazole_Liq Spec 10mg/5ml 1,034 39 £215,895.27 150 188 £220.55 £812.62 £13.87Paracetamol Susp 500mg/5ml. 470 23 £62,359.76 500 268 £107.64 £493.67 £6.36Phenytoin_Sod Liq Spec 90mg/5ml 425 32 £43,967.43 500 247 £120.83 £453.63 £3.96Tacrolimus_Liq Spec 2.5mg/5ml 77 10 £55,961.68 100 22 £382.37 £579.94 £177.85

Source: Appendix 7: Information and Guidance on the Prescribing and Use of Unlicensed Pharmaceutical Specials.Full list online at www.eoecph.nhs.uk/Pharmaceutical_Specials.pdf

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contract business from around 5 per centwhen the company was formed in 2006, toaround 60 to 70 per cent today.

It is the view of Bath ASU managingdirector Richard Wastnage that the offer ofcommercial security has undoubtedly securedprice deflation in the specials market insecondary care. But in his mind, the questionstill remains whether, in the long term, thisbusiness model will prove more cost-efficientthan simple market forces.

He says: “In the aseptic segment there aresix major multinational manufacturers andcompetition is intense as a result. I believethat the Department of Health is alreadygetting the best prices and that thecontractual framework will not improve onthis.”

Furthermore, as contracts can be made ona product and price — rather than service-ledmodel — he believes that the NHS is beingencouraged to see specials as “stockcommodities”, which, he says, “threatens theessence of what a special should be – and thatis a product that is produced on an individualpatient basis”.

A special futureBath ASU is also sceptical about the EECPH’svision to see outsourced specials manufactureswitch to in-house technical departments. Thewell documented, all-band vacancy rates insecondary care aside, Mr Wastnage says thereare several factors at play that suggest, ifanything, in the future there will be demandfor more — not less — outsourcing in hismarket. These include:

• Environmental factors — better screening,treatment, increased use of second- andthird-line chemotherapy options, morecomplex treatment schedules, and existingnational strategies to centralise asepticmanufacturing are already putting pressureon technical unit capacity

• Regulatory capacity constraints• Human resources — insufficient technical

skills in the pharmacy workforce• Product liability concerns• Health and Safety concerns — risk to the

health and safety of technical manufacturingstaff

Manufacturers respondCommercial specials manufacturers workedwith the RPS on its practice guidance and theAssociation of Commercial SpecialsManufacturers hopes that this will be the startof more collaboration to come. Alan Krol,managing director of MoorfieldsPharmaceuticals and current ACSMchairman, says: “As an industry meeting aunique clinical need [there is] need to worktogether to ensure that doctors, pharmacistsand patients are armed with the rightinformation.”

The ACSM says that over the past fewyears pharmacists have come to value and relyon the specials sector, and it is the ACSM’sopinion that most pharmacists now order intheir specials, rather than undertaking theirown preparation. Each week Martindale

Pharma says it is approached for between 20and 24 new formulations — due to factorsincluding growing awareness of the role of thedelivery mechanism in compliance, the ageingpopulation, and the increasing incidence ofcancers, which are having an impact on thenumber of patients with dysphagia. PACTfigures for the past three years(2007/08–2009/10) confirm that liquidspecials now represent almost 60 per cent ofall specials tagged by PACT as “expensive”,up from 44 per cent, and 73 per cent of thetotal cost of this specials group (up from 68.7per cent).

Mr Krol says this is not a reflection of theskill of the pharmacist: “Rather it isrecognition that manufacture of even thesimplest formulation takes time, resource andinvestment, together with all the requirementsfor quality and recording.” For this reason, theACSM says that most pharmacists will preferto pick up the telephone and order the special.“This is true of NHS pharmacists as well ascommunity pharmacy, with a significantnumber of orders coming from hospitals,” hesays.

Also stimulating demand for specials is theindustry’s total recent stated investment of

THE LEGAL AND ETHICAL ISSUES OF TABLET CRUSHING

There are several important legal and ethical implications that become relevant when the form of amedicine is changed by crushing a tablet or emptying a capsule.These can render the personadministering the medicine liable for any harm that is caused to the patient’s health.

The main statutory framework for the regulation of medicines is the Medicines Act 1968. The Actrequires that all medicinal products for human use are manufactured and used in accordance with aproduct licence or manufacturing authorisation. The Act states that “a medicine with a product licencewould be used in an unlicensed manner if the dose, route or form were outside the licensed terms”.

Statutory protection against harmful products is provided by the Consumer Protection Act 1987that implements the Product Liability Directive (Directive 85/374/EEC) from the EU. Strict liability (liabilitywithout fault) makes a producer accountable for damage caused by a defective product and thisincludes medicines. Unless it is designed to do so, changing the form of medication by crushing atablet or emptying a capsule removes the protection afforded by the Consumer Protection Act 1987and renders the person administering the altered medicine liable for any harm caused.

Duty of careThe law places a duty of care on health professionals (Kent v Griffiths [2001]). They are required toprescribe and administer medicine to others to a standard consistent with a responsible body ofprofessional opinion (Bolam v Friern HMC [1957]). The Court of Appeal has held that the duty of careincludes giving advice to patients, carers and nurses about the risks inherent in treatment, safemethods of administration and, even, the standard of handwriting used to convey instructions(Prendergast v Sam and Dee [1989]). In terms of supplying specials, Royal Pharmaceutical Societyguidance states that the pharmacist who supplies the product to the patient remains accountable forits quality. Pharmacists should, therefore, take all reasonable steps to assure it. All holders of amanufacturer’s specials licence should supply products with a certificate of conformity. A certificate ofanalysis should be available for any batch manufactured special.

Care with crushing If a healthcare professional advises that a tablet is crushed or a capsule opened to assist withswallowing difficulties and harm results then liability in negligence might arise and the injured partycould seek damages for the harm caused.

Furthermore, it is insufficient defence to say that tablet crushing is common practice. Unless it canbe shown that the practice is a safe, evidence-based, well-reasoned intervention then the court has theright to reject the professional standard (Bolitho v City & Hackney Health Authority [1998]). A healthcareprofessional will not to be exonerated because others too are negligent or common professionalpractice is slack (Reynolds v North Tyneside Health Authority [2002]).

EthicsThe Human Rights Act 1998 incorporates into UK law the main rights and freedoms set out in theEuropean Convention on Human Rights by regulating the relationship between individuals and publicauthorities. When deciding on appropriate methods of medication management and administration, it isnow necessary to focus on the patient’s wishes and interests as these closely echo the requirements ofthe Human Rights Act.

The Equality Act, which comes into force from October 1, incorporates the Disability DiscriminationAct 1995. This makes it is unlawful for a contractor to discriminate against a disabled person by failingto comply with a duty in which the effect of that failure is to make it impossible or unreasonably difficultfor a disabled person to make use of any services provided. This may make it necessary forpharmacists to provide easy-open closures or large print labels, remove tablets from blister packs,supply non oral formulations or provide monitored dosing systems.

Source: Rosemont PharmaceuticalsGuidance for contractors on implementing the DDA is available from PSNC at www.psnc.org.uk/

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around £150m in recent years in facilities andproducts. At Martindale Pharma, for example,delivery times have been a core area forbusiness development, and over the past sixmonths, the company claims to have reducedorder-to-door delivery times down from 48hours, to around 24 hours for 85 per cent ofthe company’ product portfolio. This has beenachieved through the identification of itemsmost suited to batch manufacture andmanufacturing capacity improvements, sayscompany chairman Thomas Engelen. Headds: “Patients ultimately don’t distinguishbetween licensed [products] and specials, theyjust want it in their hands as quickly aspossible after leaving the doctor’s surgery. Thechallenge for us is to consider how we canmake our supply chain mirror that of thelicensed product manufacturer.”

Mr Krol confirms that Martindale is notalone in this approach: “Specialsmanufacturers are investing heavily in newproducts, facilities and human resource,leading to faster delivery times, and morecomprehensive customer support services.Many ACSM members are nowspecialising — some in therapy areas such asophthalmics, others in delivery systems suchas liquid formulations. This specialisation willresult in tailored products for specific clinicalneeds, faster response, wider choice, higherlevels of patient compliance and, of course,patient safety.”

Victim of successAs part of its collaborative approach to theongoing investigation in the market, theACSM is readily accepting of some lessdesirable developments in the specialsindustry, namely, the burgeoning presence ofparties, variously described by some ACSMmembers as “quick-buck, cherry-pickingmerchants”, or “happy-slappy specials housesoffering too-good-to-be-true rebates”.

Summarising, these views, the ACSMidentifies the core problem as the specialsresale sector, a distribution chain over which itsays: “neither the manufacturer nor the NHShas control”. Mr Krol says: “This,unfortunately, has had a negative effect on thereputation of the industry.”

Over the past 12 months, the ACSM hasbeen working with the Department of Healthto create a system that more effectively

SUPPLYING A SPECIAL — A DECISION GUIDE FORPHARMACISTS

Preferred choice Lowest net risk

UK licensed medicinesOff-label use of a UK-licensed medicines

An imported product licensed in the country of originA UK manufactured “special” made in MHRA licensed facilities

Crushing UK-licensed tablets or opening capsulesAn extemporaneously dispensed medicine

An imported product not licensed in the country of originA non-UK-made unlicensed medicine or food supplement

Last choice Highest net risk

Source: RPS practice guidance on supplying specials

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SOME EXAMPLES OF ALTERNATIVES TO LIQUIDPHARMACEUTICAL SPECIALS

Drug Formulation and administration adviceAmlodipine Tablets will disperse in water — light sensitive so administer immediately.Doxazosin Tablets can be dispersed in sterile (not tap) water.Ferrous sulphate Change to equivalent dose of sodium feredetate (55mg/10ml = ferrous sulphate

200mg)Phenytoin Convert to syrup: 90mg syrup = 100mg capsules. Single daily dose is preferable.

To avoid adsorption to the tubing mix with equal volume water and flush with30ml water before and after administration. To avoid interaction with feeds it isnecessary to stop feed two hours before and two hours after administering.

Pantoprazole Not suitable for crushing. Consider changing to alternative proton pump inhibitor.

Source: Appendix 5: Information and Guidance on the Prescribing and Use of UnlicensedPharmaceutical Specials. Full list online at www.eoecph.nhs.uk/Pharmaceutical_Specials.pdf

PRICE PROBLEMS WILL CONTINUE

Specials suppliers fear that open price lists for specials will do nothing tocrack the price problems that pervade their market, and they coulddisadvantage quality product manufacturers.On August 19, regulations were published allowing the publication and

dissemination of price lists for unlicensed medicines. The regulations are theMedicines for Human Use (Advanced Therapy Medicinal Products andMiscellaneous Amendments) Regulations 2010. Although the Association of Commercial Specials Manufacturers

(ACSM) has welcomed the move as providing greater transparency, somemanufacturers fear that the initiative does not go far enough. Karol Pazik, ofMandeville Medicines, says: “It won’t disclose the retrospective discountingarrangements of [manufacturers] in primary care who won’t publish theirlists. It will merely give the intermediaries better opportunities to get lowerprices for the products which they already source.” He added thatcontrolling specials pricing needs something quite different.”Mr Pazik believes there are other reasons why open lists are a bad idea.

First, they give the impression that all specials are equal, “and this couldn’tbe further from the truth”, he says. “What would be of real benefit is if thelists were mandated to state the quality standard to which the special wasmanufactured, and whether shelf lives have been validated with supportingevidence.”Secondly, lists can pressure prescribers to fit the clinical need to the

listed special, and not the other way round. Mr Pazik says: “Openly-published lists ‘endorse’ the use of specials and I don’t think that is in thebest interests of the patient. Unlicensed medicines are, after all, just that —totally untried and untested and, in many cases, of dubious clinical benefit.”The Pharmaceutical Services Negotiating Committee believes that the

change has the potential “to ease the current problems pharmacycontractors face in procuring these products”, although it recognises thatsuch lists can not be comprehensive.The ACSM says the publication of price lists “will lead to greater clarity

within the marketplace”.

At Martindale, Mr Engelen agrees that theindustry needs to make a stand and stress itsquality credentials. He says: “There needs tobe a healthy debate — Martindale is a well-known name and we have an establishedrelationship with primary and secondary care.Our pricing has to be defendable, and wedon’t want all specials manufacturers placedin the same basket.”

The company is also keen to see issuessuch as compliance and medicines wastefactored into the discussion. He says: “If amedicine is discontinued due to format issues,then that is simply wasted money.”

For its part, the ACSM accepts the needfor debate, and it is keen that specials shouldbe seen as delivering value for money for theNHS. Checks already under way on thesector — for example, the Medicines andHealthcare products Regulatory Agency’sinformal review of unlicensed medicines —have already tabled suggestions such asimproving patient information and, possibly,strengthening regulation of the sector.Provided clinicians remain able to prescribefreely and according to patient need, theACSM has welcomed these proposals. It says:“ACSM members are confident that any newmeasures requested will be easily implementedinto existing best practice. They can only havea positive impact on their sector – leading to abetter understanding of the role and expertiseof specials manufacturers.”

manages the cost of specials withoutcompromising supply. For many suppliers,this workstream cannot deliver results fastenough. It is the view of MandevilleMedicine’s Karol Pazik that safety, efficacyand quality should be at the heart of a specialsindustry, which in itself should be viewed as a“last chance saloon” procurement decisionmade for the patient. But, he says: “Manypharmacies, particularly those in the smaller

chains, are under pressure to buy on price,particularly, because 80 to 90 per centretrospective rebates are on offer.” Calling fortransparency, he argues for new measures tobe implemented, including ex-factory pricing,and incentives for quality manufacturing, anddisincentives — capped margins and even theintroduction of Drug Tariff prices — forproducts supplied without a certificate ofanalysis.

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