Adjusting to Value-Driven Acquisition in an Evolving NHS Environment
The National Health Service (NHS) is set to roll out a new value-based procurement (VBP) framework, marking a significant shift in how MedTech innovation is evaluated within the health system. This strategic approach prioritizes long-term outcomes and innovation impact over just short-term cost considerations.
Key Elements of the Value-Based Procurement Framework:
1. **Focus on long-term value and patient outcomes**: The new framework will evaluate technologies on evidence of clinical effectiveness, cost-effectiveness, and impact on patient care over time, not just initial cost.
2. **National standard guidance and rules-based pathways**: To create more consistency and fairness across NHS trusts and Integrated Care Boards (ICBs), national standard guidance and rules-based pathways for MedTech procurement will be implemented.
3. **Integration with reimbursement and NICE appraisal**: From April 2026, NICE’s technology appraisal process will include some MedTech devices, diagnostics, and digital products, with mandated NHS funding for proven innovations.
4. **Innovator passports and central portals**: A national "innovator passport" for MedTech is in development, sharing evaluation data and standardizing evidence requirements. Central knowledge hubs and marketplaces like the NHS HealthStore will support SME innovators and patients.
5. **Pilot programs and early engagement**: NHS Trusts and ICBs will participate in pilot programs in late 2025 to trial the VBP framework, helping to refine and demonstrate its effectiveness in real-world procurements.
Impact on MedTech Suppliers:
1. **Stronger emphasis on evidence generation**: Suppliers will need to demonstrate clear, measurable clinical and economic benefits of their products over the medium to long term, aligning with the NHS’s focus on value rather than upfront cost only.
2. **Reduced local evaluation duplication**: The innovator passport and national standards will simplify and speed up evaluation and procurement processes, saving time and resources for suppliers.
3. **New market access pathways**: Inclusion in NICE’s appraisal and mandatory funding networks will potentially improve market access and reimbursement for MedTech innovations.
4. **Requirement for collaboration and data sharing**: MedTech companies will be encouraged or required to work closely with the NHS during early stages, sharing data and participating in outcome evaluation to meet the VBP criteria.
5. **Innovation budgets and incentivization**: Dedicated innovation budgets and a more coordinated NHS procurement system may create new opportunities for MedTech suppliers with novel technologies that demonstrate high value.
In summary, the NHS’s value-based procurement framework represents a significant shift to a more sustainable, innovation-friendly system that rewards MedTech suppliers for delivering proven health outcomes and efficiency gains, while reducing administrative complexity and duplication across the health system. Suppliers must understand where their product fits in the whole patient pathway, and how it impacts cost, efficiency, and outcomes across the system.
Sources: [1] Department of Health and Social Care (DHSC) [2] NHS England and NHS Improvement [3] National Institute for Health and Care Excellence (NICE) [4] Medicines and Healthcare products Regulatory Agency (MHRA)
- The new value-based procurement framework in the NHS prioritizes digital health solutions, leveraging technology to improve medical-conditions management and overall health-and-wellness.
- The focus on evidence-based MedTech procurement within the framework encourages innovation in science, fostering the development of novel diagnostics, treatments, and digital products.
- With the integration of reimbursement and appraisal systems, the value-based procurement framework opens up new opportunities for finance and business growth in the health sector, especially for small and medium enterprises.
