The National Institute for Health and Clinical Excellence (Nice) has recommended a scheme to fund bortezomib (commonly known as Velcade) for multiple myeloma sufferers in England and Wales who respond well to it.

Under the scheme - the first of its kind considered by Nice - the drug's manufacturer would refund the NHS when the treatment does not work.

The turnaround follows an appeal by the cancer charities Myeloma UK, Cancerbackup and Leukaemia CARE, which argued Nice's initial rejection of Velcade six months ago was based mainly on the grounds of cost, rather than effectiveness.

They said the decision was "perverse and unfair", particularly as the cost of the drug was just over the £30,000 threshold for NHS drugs.

Under the draft guidance, Nice recommends that "all suitable patients" have access to the treatment, with the NHS continuing to fund the drug for those who show a full or partial response.

Patients who do not benefit should be taken off the treatment, with the cost refunded by the manufacturer, Janssen-Cilag, Nice said.

It said the new guidance followed an evaluation of a refund scheme put forward by Janssen-Cilag. The guidance is subject to a three-week consultation, with final approval tabled for October.

Nice chief executive Andrew Dillon said: "We are aware of the challenge that the NHS faces in ensuring that patients can access expensive, but potentially effective, treatments for life-threatening conditions such as cancer.

"If the drug's manufacturer accepts the proposals we are consulting on today, it will mean that when the drug works well the NHS pays but when it doesn't the manufacturer should bear the cost."