Professor Karl Claxton doesn't mince words. After founding NICE's Appraisal Committee in 1999 and spending over a decade shaping UK health technology assessment, he published what he calls his "public declaration of war on NICE" in 2015. His grievance? The institution had been "thoroughly captured."

In late 2025, he wrote an open letter to the Prime Minister warning against a proposal to raise NICE's willingness-to-pay threshold. His warnings went unheeded.

The context: Pharma companies had walked out of negotiations in August. CEOs declared the UK a "terrible place" to invest. Lord Valance, the UK's Minister for Science, suggested increasing pharma spending from 9% to 14% of the NHS budget. And Trump's US trade negotiator was arriving with an explicit agenda to force other countries to pay more for drugs while Americans pay less.

Despite Claxton's warnings, the government moved forward. NICE's willingness-to-pay threshold was raised from £20,000-£30,000 per QALY to £25,000-£35,000 per QALY.

Claxton had called this "a damn silly thing done in the most damn silly way."

His reasoning: Even with rebates in place, threshold increases matter enormously because new drugs are exempt from rebates for their first three years. More importantly, raising the threshold badly distorts incentives—it over-rewards drugs that increase NHS costs while under-rewarding those that reduce them.

"It directly undermines the objectives in the 10-year plan for the NHS," Claxton argued.

This brings us to one of the most provocative findings from Claxton's research team at York: pharmaceutical companies should receive roughly 20% of a drug's long-term value.

Wait—how do you even calculate "long-term value"?

Claxton's colleague Beth Woods led two papers in Health Economics that answered this question. The first examined what share of long-term value the UK currently pays. The surprising answer? Often more than 100%.

The second paper asked: what should the share be? Using causal evidence on how innovation responds to financial rewards, they concluded that if the NHS (or the world acting collectively) wants to optimize both access and innovation, about 20% of long-term value is the right target.

The long-term value according to Claxton works like this: it benchmarks new branded drugs against generic versions of older brands. Any incremental health gain from the original innovation gets "baked in" and continues delivering value even after the branded version disappears from prescriptions. Factor in disease incidence trends and discount rates, and you get a generous estimate of total value created.

The threshold increase wasn't just a UK story—Claxton was blunt about what drove the pressure: Trump wanted cheaper domestic drug prices and was willing to use trade negotiations and tariff threats to make other countries pay more. The pharmaceutical industry leveraged this to extract higher prices globally.

"It's no secret. It's out there in black and white," Claxton said.

His warnings about the consequences were specific: diverting NHS spending to higher drug prices would be catastrophic for health outcomes across all patient groups and would damage local economic growth. His team at York had built a body of causal evidence demonstrating these impacts.

His frustration at the time? "There is no publicly available impact assessment of the things being considered by government."

That lack of transparency meant the decision was made without public understanding of its full implications—exactly what Claxton had warned against.

Claxton doesn't just criticize the current proposal—he argues the entire NICE process needs fundamental restructuring.

The Single Technology Appraisal (STA) system, introduced during his time on the committee, was "a total disaster" born from political pressure to approve new drugs. It was implemented "in a matter of weeks."

His proposal: separate price negotiation from clinical guidance entirely. NICE should return to indication-based appraisals that evaluate all treatment options available at a particular point in a patient's disease journey—not just compare one new drug to existing practice.

This would produce guidance that's actually useful for clinical practice while creating a fairer, more transparent pricing mechanism.

When asked which country has the best HTA system, Claxton points to an almost-success story: Canada’s Patent Medicines Prices Review Board.

Their approach was elegant: charge whatever price you want, but rebates must bring the effective price down to what Canada can afford. Prove your post-rebate price hits the target across provinces, and you're approved.

The genius was in the enforcement mechanism. If a company refused to launch in Canada despite a post-rebate price sufficient to manufacture without losses, Canada would treat this as non-assertion of the patent and issue compulsory licenses for domestic production.

"That's as close as we got to something sensible," Claxton notes. "The threat of compulsory license if you refuse to launch but you could manufacture and deliver for that post-rebate price—I think that's very important. It would never need to be done more than once."

For those familiar with NICE methodology, you might think broader value assessments could help—considering wider societal benefits, productivity gains, caregiver impacts.

Claxton is sceptical: "Every petal you put on the ISPOR flower is a petal on the opportunity cost side. The more petals you put on, the more we'll estimate what we lose. Forget about the ISPOR flower. It won't save you."

Translation: expanding what you measure doesn't change the fundamental budget constraint. It just makes explicit all the other things you're sacrificing.

This conversation was a warning. The NICE threshold has now increased to £25,000-£35,000 per QALY. The pressure from industry, from Trump's trade agenda, and from ministers wanting to appear pro-innovation won.

Claxton's research team had the causal evidence showing that this decision would harm millions of NHS patients and damage the UK economy. The decision was made anyway, without public impact assessment.

As Claxton put it in our conversation: "We live in a democracy. Celebrate it."

Whether we're celebrating or mourning remains to be seen. The consequences he predicted are now unfolding in real time.