Indication-specific pricing in England: Business as usual?
Leela Barham highlights data that shows that indication-specific pricing has been used in England for at least four years and over 60 times.
Lessons from that experience should be used to provide greater clarity for companies on when and how they can pursue indication-specific pricing as part of their pricing strategy, supporting patient access.
Indication-specific pricing a Life Sciences Sector Plan promise
Despite the lack of agreement between the UK government and the industry group ABPI on the voluntary scheme for branded medicines access and pricing (VPAG), companies are still having to get on with the job of pricing and achieving reimbursement of those new treatments that are still coming to the UK market. For those treatments where value differs by indication, indication-specific pricing could help companies manage pricing dynamics.
In July 2025, the government published their Life Sciences Sector Plan. Action 28 in the plan promised the introduction of “a new and proportionate approach to NICE appraisals and NHS indication-specific based pricing agreements for medicines.”
The plan suggests that indication-specific pricing will be offered when those medicines meet several criteria: where there are a large number of indications, strong long-term outcome data, and low affordability risk.
Carl Prescott, senior director for pipeline and early access strategy at AXIS, described the pilot of multi-indication pricing as the most interesting announcement within the strategy.
Lack of clarity
What the plan means in practical terms for when indication-specific pricing will be available to companies wasn’t spelled out, nor what the new and proportionate approach means for how to agree on indication-specific pricing.
The lack of clarity was noted by Julie Brennan from Verto Health Consulting Ltd, in a LinkedIn post. Prescott also said much the same thing: “I think the exact processes/methodologies will be tricky to implement.”
Optimism
Despite the lack of detail, there’s optimism. A LinkedIn post from Gordon Bache, partner at Windrose Consulting Group, described indication-specific pricing as a “game changer.” Brennan suggested that indication-specific pricing and streamlined NICE appraisal of multi-indication medicines was a standout for access, pricing, and evidence strategies.
Previous policy
The Life Sciences Sector plan is just the latest policy document to moot indication-specific pricing. There’s much to learn from those, not so much in terms of process, but in when indication-specific pricing could be used.
The VPAG agreement, published in December 2023, set out criteria for when NHSE would consider use of indication-specific pricing, including:
The indication meets an unmet clinical need.
The company can demonstrate that uniform pricing would reduce the total revenue for a medicine from introducing additional indications.
Sufficient data is available within existing NHS systems to make such arrangements operationally feasible.
The cost-effective price is highly differentiated for all indications under consideration.
The value proposition for the indication aligns to the expectations set out in paragraph 3.30.
Paragraph 3.30 states: “the arrangements […] would normally correspond to medicines that would be expected to have value propositions at or below the lower end of the standard NICE cost effectiveness threshold range.”
The VPAG included the commitment that NHS England would consult on an update to the NHS England Commercial Framework for New Medicines that included being “more explicit about enhanced commercial flexibilities and when they can be offered, including the approach taken for assessing the eligibility for medicines treating multiple indications to qualify for indication-specific pricing mechanisms.”
The most recent iteration of the Framework sets out the same criteria for indication-specific pricing to apply as set out in VPAG, but adds further details. They include signals about the NHS drive for better value referencing health system productivity benefit, as well as assurance on affordability, with requirements for companies to share volume forecasts. Operational features are highlighted too, including data to monitor how many patients are treated.
The ABPI suggested that the criteria for indication-specific pricing were clearer than in the past, yet, the requirement for treatments to provide additional value being at or below the lower end of NICE’s cost-effectiveness threshold was a significant barrier. The association’s blog warned: “Many medicines requiring commercial flexibility may struggle to meet these conditions, limiting patient access.”
VPAG was arguably a clearer signal about the potential for indication-specific pricing than its predecessor VPAS. That agreement, published in December 2018, said: “The health service in England does not operate blended pricing or pricing by indication.” Yet, it also softened that position a little, adding, “[i]n cases where uniform pricing would lead to a reduction in total revenue for a medicine overall from the introduction of additional indications, other forms of commercial flexibility may be considered for medicines with a strong value proposition.”
As a side note, this discussion leaves aside whether indication-specific pricing should be an option at all. There’s been a debate about its impact in England, with a recent illustration being the OHE’s critique of an EEPRU paper in November 2024. But since it is an option, the question becomes how best to do it.
Opportunity to learn from practice
Indication-specific pricing has been an option in England according to policy, but just how much has it been used? Some data helps with that.
The Department of Health and Social Care provided data to support a response to a Parliamentary Question (PQ) on 4 August 2025 that said that “NHS England had entered into 62 commercial agreements involving indication-specific pricing for cancer indications.” Those agreements were agreed upon between January 2020 and March 2025. That means around 15 a year.
The PQ response also broke the 62 down between rare and ultra-rare cancer indications; 60 were in rare cancer indications, and two for ultra-rare indications.
Other data sheds some light on routes to agreeing multi-indication arrangements. A PQ response from 21 May 2024 said that, “since April 2020, NHS England had agreed to 37 commercial agreements that resulted in non-uniform pricing by medicine, via either the Cancer Drugs Fund, or through bespoke commercial deals to support routine commissioning”. A freedom of information follow-up to that PQ revealed that 13 were commercial agreements via the CDF, 20 outside of the CDF, and 4 both via the CDF and outside the CDF.
This older data also suggests that use of indication-specific pricing has been growing in recent years; 25 indication-specific agreements from May 2024 to March 2025 alone.
The data demonstrates that indication-specific pricing has been used for years. By now, the NHS and its various bodies involved must have worked through how to do it. Companies must have learnt, too. What would be helpful is to identify from that experience when and how to go about agreeing on indication-specific prices. Those lessons should be used to provide clarity to companies to know how to pursue indication-specific pricing as a strategy. That would help everyone to know just when it can become part of business as usual and support access to treatments for patients.
