Health campaigners have expressed disappointment after the medicines watchdog rejected the first pill to treat multiple sclerosis.
The MS Society urged the National Institute for Health and Clinical Excellence (Nice) and drug firm Novartis to work together so Gilenya (also called fingolimod) can be re-appraised.
In draft guidance which is subject to consultation, Nice rejected the drug due to "uncertainties" over its effectiveness, a lack of appropriate data and concerns over cost-effectiveness.
It said it was unclear how much the drug would help the specific group of people for whom it was licensed - adults with relapsing-remitting multiple sclerosis (RRMS) who experienced at least one relapse a year despite being treated with beta interferon drugs.
Another group of patients suitable for the drug were those with rapidly evolving severe RRMS, who experience two or more disabling relapses regardless of their treatment.
Nice said Novartis had submitted data mainly looking at a subgroup of patients with the former type of MS.
Novartis also only submitted data comparing Gilenya with a placebo and with a type of beta interferon not believed to be widely prescribed on the NHS, according to Nice.
Professor Carole Longson, director of the health technology evaluation centre at Nice, said: "While it's important that people with multiple sclerosis have treatment options, Nice has to ensure that the NHS provides treatments that bring benefits that are value for money.
"Unfortunately our independent committee wasn't given sufficient evidence to show that fingolimod could reduce relapses considerably better than the other treatments currently being used.
"Based on the available clinical evidence and economic analysis, our independent committee concluded that fingolimod would not be effective good use of NHS resources."
Simon Gillespie, chief executive of the MS Society, said: "This is disappointing news for people with MS and it will leave some people with no effective treatment option.
"Access to MS treatments in the UK is very poor - in fact people with MS would be better off living almost anywhere else in Europe, and this decision will only deepen that inequality.
"We're concerned at how this decision has been reached and now strongly encourage Nice and Novartis to work together to look at how the treatment can be better re-considered and evaluated."
Novartis said Nice had suggested best supportive care (no active treatment at all) as the appropriate comparator for Gilenya.
But it said this did not reflect current clinical practice in the UK according to neurologists.
A statement said: "Novartis believes that comparing fingolimod to best supportive care will unfairly restrict access to fingolimod, as well as any future new treatments.
"It will be very difficult for any new therapy to demonstrate cost effectiveness against best supportive care.
"This approach is likely to restrict new treatment options in the UK to symptom management medicines only, which could result in continued relapses."
MS has traditionally been treated with injectable drugs. Around 100,000 people in the UK have MS.