It’s a well known fact that many drugs for many diseases don’t work very well in in many patients. If we could identify in advance which patients will benefit from a drug and which won’t, then drugs could be prescribed in a much more targeted manner. That is actually a lot harder to do than it sounds, but it’s an active area of research, and I am confident that over the coming years and decades medical research will make much progress in that direction.

This is the world of personalised medicine.

Although giving people targeted drugs that are likely to be of substantial benefit to them has obvious advantages, there is one major disadvantage. Personalised medicine simply does not fit the economic model that has evolved for the pharmaceutical industry.

Developing new drugs is expensive. It’s really expensive. Coming up with a precise figure for the cost of developing a new drug is controversial, but some reasonable estimates run into billions of dollars.

The economic model of the pharmaceutical industry is based on the idea of a “blockbuster” drug. You develop a drug like Prozac, Losec, or Lipitor that can be used in millions of patients, and the huge costs of that development can be recouped by the  huge sales of the drug.

But what if you are developing drugs based on personalised medicine for narrowly defined populations?  Perhaps you have developed a drug for patients with a specific variant of a rare cancer, and it is fantastically effective in those patients, but there may be only a few hundred patients worldwide who could benefit. There is no way you’re going to be able to recoup the costs of a billion dollars or more of development by selling the drug to a few hundred patients, without charging sums of money that are crazily unaffordable to each patient.

Although the era of personalised medicine is still very much in its infancy, we have already seen this effect at work with drugs like Kadcyla, which works for only a specific subtype of breast cancer patients, but at £90,000 a pop has been deemed too expensive to fund in the NHS. What happens when even more targeted drugs are developed?

I was discussing this question yesterday evening over a nice bottle of Chilean viognier with Chris Winchester. I think between us we may have come up with a cunning plan.

Our idea is as follows. If a drug is being developed for a suitably narrow patient population that it could be reasonably considered a “personalised medicine”, different licensing rules would apply. You would no longer have to obtain such a convincing body of evidence of efficacy and safety before licensing. You would need some evidence, of course, but the bar would be set much lower. Perhaps some convincing laboratory studies followed by some small clinical trials that could be done much more cheaply than the typical phase III trials that enrol hundreds of patients and cost many millions to run.

At that stage, you would not get a traditional drug license that would allow you to market the drug in the normal way. The license would be provisional, with some conditions attached.

So far, this idea is not new. The EMA has already started a pilot project of “adaptive licensing“, which is designed very much in this spirit.

But here comes the cunning bit.

Under our plan, the drug would be licensed to be marketed as a mixture of the active drug and placebo. Some packs of the drug would contain the active drug, and some would contain placebo. Neither the prescriber nor the patient would know whether they have actually received the drug. Obviously patients would need to be told about this and would then have the choice to take part or not. But I don’t think this is worse than the current situation, where at that stage the drug would not be licensed at all, so patients would either have to find a clinical trial (where they may still get placebo) or not get the drug at all.

In effect, every patient who uses the drug during the period of conditional licensing would be taking part in a randomised, double-blind, placebo-controlled trial.  Prescribers would be required to collect data on patient outcomes, which, along with a code number on the medication pack, could then be fed back to the manufacturer and analysed. The manufacturer would know from the code number whether the patient received the drug or placebo.

Once sufficient numbers of patients had been treated, then the manufacturer could run the analysis and the provisional license could be converted to a full license if the results show good efficacy and safety, or revoked if they don’t.

This wouldn’t work in all cases. There will be times when other drugs are available but would not be compatible with the new drug. You could not then ethically put patients in a position where a drug is available but they get no drug at all. But in cases where no effective treatment is available, or the new drug can be used in addition to standard treatments, use of a placebo in this way is perfectly acceptable from an ethical point of view.

Obviously even when placebo treatment is a reasonable option, there would be logistical challenges with this approach (for example, making sure that the same patient gets the same drug when their first pack of medicine runs out). I don’t pretend it would be easy. But I believe it may be preferable to a system in which the pharmaceutical industry has to abandon working on personalised medicine because it has become unaffordable.