LONDON (Reuters) - Britain's health cost watchdog NICE will be responsible for assessing the full value of medicines under a value-based pricing system for new drugs due to take effect from 2014, the government said on Thursday.
The move, which had been expected, will allow the National Institute for Health and Clinical Excellence (NICE) to build on its current drug evaluation processes by giving it broader scope to assess a medicine's benefits and costs.
Britain's current drug pricing arrangements cap the return on investment that drugmakers can make. From January 2014, the new scheme - details of which have still to be finalized - will seek to reward manufacturers based on a drug's value to society.
This means that companies will be rewarded with higher prices for the most effective, innovative and badly needed new medicines. But the shift to value-based pricing has triggered concerns in industry that Britain might become a more difficult market in which to launch new products.
NICE has been assessing which drugs should be paid for on Britain's state health system for the last 14 years.
Its decisions recommending against reimbursement often spark controversy, as in the case of several rebuffs for cancer treatments from companies including Roche and GlaxoSmithKline. Overall, however, it recommends many more new medicines than it turns down.
(Reporting by Ben Hirschler; editing by Keiron Henderson)