Pharmaceutical Pricing and Reimbursement in Europe Reference Pricing and Similar Initiatives Being Applied to Innovative Drugs Pose Significant Challenge to

Document Sample
Pharmaceutical Pricing and Reimbursement in Europe Reference Pricing and Similar Initiatives Being Applied to Innovative Drugs Pose Significant Challenge to Powered By Docstoc
					       Pharmaceutical Pricing and Reimbursement in Europe -
      Reference Pricing and Similar Initiatives Being Applied to
           Innovative Drugs Pose Significant Challenge to
                     Pharmaceutical Companies
 Reference Code: GBIHC122MR                                                                                                                                  Publication Date: November 2011


                                     Pricing and Reimbursement in Europe
Healthcare across EU is
                                      Pricing and Reimbursement in Europe, Estimated Costs Paid by the Patient and Health
largely publicly financed
                                      Insurance System in the Total Reimbursed Pharmacy Market Value at Retail Prices (%),
                                      2008

                                                           100%

                                                           90%

                                                           80%

                                                           70%

                                                           60%
                                              % of Costs




                                                           50%

                                                           40%

                                                           30%

                                                           20%

                                                           10%

                                                            0%
                                                                                                                                                 Italy




                                                                                                                                                                  Norway
                                                                                                                             Germany




                                                                                                                                                         Poland




                                                                                                                                                                                                 Sweden
                                                                              Czech Republic




                                                                                                                                       Hungary




                                                                                                                                                                                         Spain
                                                                  Austria




                                                                                                          Finland




                                                                                                                                                                               Romania
                                                                                                                    France




                                                                                                                                                                                                          The UK
                                                                                               Denmark




                                                                            Costs paid by compulsory health insurance systems (%)                                          Costs paid by patients

                                      Source: GBI Research, European Federation of Pharmaceutical Industries and Associations (EFPIA)




                                     Healthcare across the European Union (EU) and majority of the European nations is largely
                                     publicly financed and is provided by health insurance systems; hence, the governments of
                                     European nations play a key role in providing healthcare for their citizens. Health is a high priority
                                     for Europe’s citizens and pharmaceutical costs are the third most costly component in the member
                                     states’ healthcare budgets. Hospital and ambulatory care spending account for the first two most
                                     important components in their health care budgets, according to a 2009 report by the European
                                     Commission. Currently, the governments of the member countries face substantially rising costs for
                                     the provision of health care (average costs are rising at a faster rate than Gross Domestic Product
                                     (GDP) due to factors such as over-prescription of drugs, their irrational usage, and other key
                                     factors such as Europe’s ageing population and increasing cost of new medical technologies.
                                     Consumer preference for branded drugs to generic drugs in cases where drug patents have
                                     expired is also contributing to increasing healthcare costs.




Pharmaceutical Pricing and Reimbursement in Europe -                                                                                          GBIHC122MR /Published NOV 2011
Reference Pricing and Similar Initiatives Being Applied to                                                                                                                  Page 1
Innovative Drugs Pose Significant Challenge to Pharmaceutical                                            © GBI Research. This report is a licensed product and is not to be copied,
Companies                                                                                                                                reproduced, shared or resold in any form
                                     Growing Healthcare Expenditure Fueled by an Ageing Population in Europe
                                     It was estimated that in 2009, the average number of healthy life years by people in the EU (27
                                     countries) was 73.3 years, with Sweden accounting for the highest number of healthy life years at
                                     79.1 years. Governments across Europe are facing growing healthcare expenditure, primarily due
                                     to ageing populations. However, recent austerity measures implemented by countries such as Italy,
                                     France, Germany and the UK to tackle the economic crisis have resulted in tightening healthcare
                                     budgets, resulting in a downward pressure on pharmaceutical prices. This is bringing changes in
                                     the pricing and reimbursement scenario in countries across Europe. The specific features of
                                     individual policies vary significantly across the member nations.
                                     Value-based pricing Replacing Pharmaceutical Price Regulation Scheme in the UK from
                                     2014
                                     After the current PPRS, the system of pricing medicines, launched in 2009 has run its course, a
                                     new value-based approach to the pricing of branded medicines, called value-based pricing (VBP) is
                                     expected to be introduced in the UK after the expiry of PPRS in 2013, despite concerns regarding
                                     the mechanism of the VBP system. The UK is among the few markets that allows drug companies
                                     to set their own prices; however, the National Institute of Health and Clinical Excellence (NICE),
                                     one of the main regulatory bodies, under the Conservative-Liberal Democrat coalition has decided
                                     to adopt VBP which will be determined by the maximum affordable cost per Quality Adjusted Life
                                     Years (QALY) generated by the use of new medicines. At the time of establishing the price of a
                                     new drug candidate, the drug manufacturer will be required to submit clinical trial evidence
                                     suggesting that their drug is more effective than existing drugs in the market. The new system will
                                     be applied to newly branded prescription drugs, but will not be applied to currently marketed drugs
                                     or generics. As this new system is introduced, the main focus of regulation is shifted towards profit
                                     rather than price controls.
                                     Reimbursement Reduced for Drugs with Moderate and Low Clinical Benefit in France
                                     The French government intends to cut its healthcare bill and a major reduction will be derived from
                                     limiting drug prices and enforcing price cuts including parallel imported drugs. The French
                                     government's pricing and reimbursement committee, Economic Committee on Health Products
                                     (CEPS) has instituted a change in reimbursement rate of drugs with moderate clinical benefit from
                                     35% to 30% and to 15% from a previous 20% for drugs with low clinical benefit. The move was part
                                     of the 2011 Social Security Budget Bill. Moreover, for all medical procedures, the co-payment will
                                     be increased by half a percentage point. Also, the health ministry is creating a roadmap for
                                     changes in the laws on reimbursing drugs that will result in quicker termination of reimbursement
                                     for drugs given a minimal clinical benefit rating.
                                     Benefit Assessment Led Price Negotiation, Price Freeze and Mandatory Discounts in
   AMNOG in Germany is               Germany
   expected to assist in the
   overall effort to curb in         Pharmaceutical prices in Germany have been among the highest in Europe. The Act on the Reform
   exploding costs for the           of the Market for Medicinal Products (AMNOG) that came into effect on January 2011 in Germany
   country's public health           is expected to assist in the overall effort to curb in exploding costs for the country’s public health
   insurance system.                 insurance system. The new act will only allow the pharmaceutical manufacturers to set prices freely
                                     for the first year post the drug product’s launch in the German market after which they are required
                                     to negotiate the prices with the Federal Joint Committee (Gemeinsamer Bundesausschuss, G-BA).
                                     A major cost containment measure relates to the in-patent drugs where pharmaceutical
                                     manufacturers are required to submit evidence of the added benefit rendered to patients when they
                                     launch a product with new active ingredients to market. Mandatory discounts for patented
                                     medicines offered to the statutory health system have been increased from 6% to 16%. Moreover,
                                     price freeze on medicines have been imposed until the end of 2013 at August 2009 levels. The
                                     objective behind the measure was an urgent and short term control on expenditure growth. It will
                                     also retain the old discount price contract system for generic drugs.




Pharmaceutical Pricing and Reimbursement in Europe -                                                        GBIHC122MR /Published NOV 2011
Reference Pricing and Similar Initiatives Being Applied to                                                                                Page 2
Innovative Drugs Pose Significant Challenge to Pharmaceutical          © GBI Research. This report is a licensed product and is not to be copied,
Companies                                                                                              reproduced, shared or resold in any form
                                     A Rebate of 7.5% for In-Patent Drugs and Price Cuts for Generics in Spain
                                     Though price cuts are not imposed on reimbursed patented drugs in Spain, effective from June
                                     2010 they have been imposed with rebates under the National Health System (NHS). The rebate is
                                     7.5% of the sales to the NHS for all reimbursed medicines, whether for ambulatory or hospital use.
                                     Orphan medicines are also subject to a 4% rebate. An average 25% cut in generic prices has been
                                     implemented from July 2010 as a part of the austerity package in an effort to bring down the health
                                     care costs. Moreover, several regions in the country such as Navarra, Extremadura, Catalonia are
                                     attempting to shape prescribing pattern and encourage greater use of generics by instructing
                                     doctors to prescribe common medications by active pharmaceutical ingredient instead of branded
                                     products. Other initiatives expected to impact pricing of pharmaceuticals include regional tendering,
                                     and creating regional catalogues that prioritize reimbursed medicines though such catalogues
                                     exceed regional authority and the Supreme Court often overturn these regional initiatives.




Pharmaceutical Pricing and Reimbursement in Europe -                                                        GBIHC122MR /Published NOV 2011
Reference Pricing and Similar Initiatives Being Applied to                                                                                Page 3
Innovative Drugs Pose Significant Challenge to Pharmaceutical          © GBI Research. This report is a licensed product and is not to be copied,
Companies                                                                                              reproduced, shared or resold in any form
                                     1         Table of Contents
                                     1 Table of Contents ........................................................................................................................ 4
                                       1.1    List of Tables..................................................................................................................... 6
                                       1.2    List of Figures ................................................................................................................... 6
                                     2 Pricing and Reimbursement in Europe - Introduction .................................................................. 7
                                       2.1    GBI Research Report Guidance ....................................................................................... 7
                                     3 Pricing and Reimbursement in Europe - Overview ...................................................................... 8
                                       3.1    Healthcare Expenditure Highly Correlated with GDP ...................................................... 10
                                       3.2    Relation between Pharmaceutical Expenditure and GDP ............................................... 12
                                       3.3    Overview of Pharmaceutical Regulations in Europe ....................................................... 13
                                          3.3.1    Negotiations............................................................................................................. 14
                                          3.3.2    International Price Referencing ............................................................................... 14
                                          3.3.3    Internal Reference Pricing ....................................................................................... 15
                                          3.3.4    Tendering ................................................................................................................ 15
                                          3.3.5    Price Capping of Generic Pharmaceuticals ............................................................. 15
                                          3.3.6    Use of Positive and Negative Formulary ................................................................. 16
                                          3.3.7    Value Based Pricing and Risk-Sharing Models ....................................................... 16
                                          3.3.8    Increased Focus on Evidence-based Medicine and Health Technology Assessment
                                                   (HTA) ....................................................................................................................... 18
                                          3.3.9    Role of Pharmacoeconomics in Pricing and Reimbursement .................................. 19
                                          3.3.10 EU Single Pricing – Still an Unresolved Issue ......................................................... 20
                                       3.4    Recent Major Changes in Pricing and Reimbursement of Drugs in Europe.................... 21
                                          3.4.1    The UK to Adopt VBP Replacing PPRS from 2014 despite Concerns of Companies
                                                   and Experts Alike..................................................................................................... 21
                                          3.4.2    Major Challenge Regarding VBP Adoption in the UK .............................................. 21
                                          3.4.3    France Decreases Reimbursement for Drugs with Moderate Clinical Benefits Along
                                                   With Overall Price Cuts ........................................................................................... 21
                                          3.4.4    Benefit Assessment Led Price Negotiation, Price Freeze and Mandatory Discounts
                                                   Key Features Of German P&R Changes ................................................................. 22
                                          3.4.5    Italian P&R Scene Dominated By Price Cuts and Changes in Reference Price Level
                                                    ................................................................................................................................ 22
                                          3.4.6    Main Austerity Measures in Spain Include 7.5% Rebate for In-Patent Drugs and
                                                   Price Cuts for Generics ........................................................................................... 22
                                          3.4.7    Renewed P&R Cut Of 7% in Czech Republic and Proposed Changes in VAT for
                                                   2012 And 2013 ........................................................................................................ 22
                                          3.4.8    Expenditure on Reimbursement of Medicines Fixed At 17% of the NHF in Poland . 23
                                          3.4.9    Levy on Sale of Reimbursed Drugs in Hungary to Go Up To 20%; Payment-By-
                                                   Result another Major Move...................................................................................... 23
                                     4 Pricing and Reimbursement in Europe - The Top Five Countries of Europe ............................. 24
                                       4.1    The UK ............................................................................................................................ 25
                                          4.1.1    Healthcare System in the UK................................................................................... 25
                                          4.1.2    Healthcare expenditure – Other Developed Countries More Prominent Healthcare
                                                   Spenders ................................................................................................................. 26
                                          4.1.3    Pricing and Reimbursement Process in the UK ....................................................... 27
                                          4.1.4    Key Trends .............................................................................................................. 29
                                          4.1.5    Major Challenges..................................................................................................... 30
                                       4.2    France ............................................................................................................................. 31
                                          4.2.1    Healthcare System in France .................................................................................. 31
                                          4.2.2    Pricing and Reimbursement Process in France....................................................... 33
                                          4.2.3    Key Trends .............................................................................................................. 36
                                          4.2.4    Major Challenges..................................................................................................... 39
                                       4.3    Germany ......................................................................................................................... 40
                                          4.3.1    Healthcare System in Germany ............................................................................... 40
                                          4.3.2    Pricing and Reimbursement Process in Germany ................................................... 41
                                          4.3.3    Key Trends .............................................................................................................. 42


Pharmaceutical Pricing and Reimbursement in Europe -                                                                       GBIHC122MR /Published NOV 2011
Reference Pricing and Similar Initiatives Being Applied to                                                                                               Page 4
Innovative Drugs Pose Significant Challenge to Pharmaceutical                         © GBI Research. This report is a licensed product and is not to be copied,
Companies                                                                                                             reproduced, shared or resold in any form
                                          4.3.4     Major Challenges..................................................................................................... 45
                                       4.4    Italy ................................................................................................................................. 45
                                          4.4.1     Healthcare System in Italy ....................................................................................... 45
                                          4.4.2     Pricing and Reimbursement Process in Italy ........................................................... 45
                                          4.4.3     Key Trends .............................................................................................................. 46
                                          4.4.4     Major Challenges..................................................................................................... 48
                                       4.5    Spain ............................................................................................................................... 48
                                          4.5.1     Healthcare System in Spain .................................................................................... 48
                                          4.5.2     Pricing and Reimbursement Process in Spain......................................................... 48
                                          4.5.3     Key Trends .............................................................................................................. 49
                                          4.5.4     Major Challenges..................................................................................................... 50
                                     5 Pricing and Reimbursement in Europe - Eastern Europe .......................................................... 51
                                       5.1    Czech Republic ............................................................................................................... 52
                                          5.1.1     Healthcare System in Czech Republic .................................................................... 52
                                          5.1.2     Pricing and Reimbursement Process in the Czech Republic ................................... 52
                                          5.1.3     Key Trends .............................................................................................................. 53
                                          5.1.4     Major Challenges..................................................................................................... 53
                                       5.2    Poland ............................................................................................................................. 53
                                          5.2.1     Healthcare System in Poland .................................................................................. 53
                                          5.2.2     Pricing and Reimbursement Process in Poland....................................................... 54
                                          5.2.3     Key Trends .............................................................................................................. 54
                                          5.2.4     Major Challenges..................................................................................................... 56
                                       5.3    Romania.......................................................................................................................... 56
                                          5.3.1     Pricing and Reimbursement Process in Romania ................................................... 56
                                          5.3.2     Key Trends .............................................................................................................. 57
                                          5.3.3     Major Challenges..................................................................................................... 58
                                       5.4    Hungary .......................................................................................................................... 58
                                          5.4.1     Healthcare System in Hungary ................................................................................ 58
                                          5.4.2     Pricing and Reimbursement Process in Hungary .................................................... 58
                                          5.4.3     Key Trends .............................................................................................................. 59
                                          5.4.4     Major Challenges..................................................................................................... 60
                                     6 Pricing and Reimbursement in Europe - Scandinavia ............................................................... 61
                                       6.1    Norway ............................................................................................................................ 62
                                       6.2    Finland ............................................................................................................................ 62
                                       6.3    Denmark ......................................................................................................................... 62
                                     7 Pricing and Reimbursement in Europe - Appendix .................................................................... 64
                                       7.1    Market Definitions ........................................................................................................... 64
                                       7.2    Abbreviations .................................................................................................................. 64
                                       7.3    Research Methodology ................................................................................................... 66
                                          7.3.1     Healthcare System .................................................................................................. 66
                                          7.3.2     Pricing and Reimbursement Process ...................................................................... 67
                                          7.3.3     Key Trends .............................................................................................................. 67
                                          7.3.4     Major Challenges..................................................................................................... 67
                                       7.4    Contact Us ...................................................................................................................... 67
                                       7.5    Disclaimer ....................................................................................................................... 67
                                       7.6    Sources ........................................................................................................................... 68




Pharmaceutical Pricing and Reimbursement in Europe -                                                                       GBIHC122MR /Published NOV 2011
Reference Pricing and Similar Initiatives Being Applied to                                                                                               Page 5
Innovative Drugs Pose Significant Challenge to Pharmaceutical                         © GBI Research. This report is a licensed product and is not to be copied,
Companies                                                                                                             reproduced, shared or resold in any form
                                     1.1       List of Tables
                                     Table 1:  Pricing and Reimbursement in Europe, Supply-Side Pharmaceutical Regulations ........ 13
                                     Table 2:  Pricing and Reimbursement in Europe, Demand-Side Pharmaceutical Regulations ..... 13
                                     Table 3:  Pricing and Reimbursement in Europe, Regulatory Mechanisms in Top Five Countries of
                                               Europe ........................................................................................................................... 24
                                     Table 4: Pricing and Reimbursement in Europe, the UK, General Price Changes (%), 2009-2013
                                               ....................................................................................................................................... 29
                                     Table 5: Pricing and Reimbursement in Europe, France, Types of Treatment and their
                                               Reimbursement levels.................................................................................................... 32
                                     Table 6: Pricing and Reimbursement in Europe, France, Social Security Deficit, €bn and $bn,
                                               2009-2011 ...................................................................................................................... 34
                                     Table 7: Pricing and Reimbursement in Europe, France, National Target for Expenditure in Public
                                               Healthcare/ ONDAM, €bn and $bn, 2010-2011 ............................................................. 35
                                     Table 8: Pricing and Reimbursement in Europe, List of Innovative Drugs for Regions, AIFA, 2010
                                               ....................................................................................................................................... 47
                                     Table 9: Pricing and Reimbursement in Europe, Regulatory Mechanisms in Eastern Europe ..... 51
                                     Table 10: Pricing and Reimbursement in Europe, Regulatory Mechanisms in the Scandinavian
                                               Countries ........................................................................................................................ 61


                                     1.2       List of Figures
                                     Figure 1: Pricing and Reimbursement in Europe, Estimated Costs Paid by the Patient and Health
                                                Insurance System in the Total Reimbursed Pharmacy Market Value at Retail Prices (%),
                                                2008 ................................................................................................................................. 8
                                     Figure 2: Pricing and Reimbursement in Europe, Healthy Life Years At 65 For Males And
                                                Females, 2009 ................................................................................................................. 9
                                     Figure 3: Pricing and Reimbursement in Europe, Health expenditure per capita With Respect To
                                                GDP per capita, $PPP, 2009 ......................................................................................... 10
                                     Figure 4: Healthcare Expenditure in Europe and the US, Healthcare Expenditure as % of GDP,
                                                1960-2008 ...................................................................................................................... 11
                                     Figure 5: Pricing and Reimbursement in Europe, Pharmaceutical Expenditure Per Capita And
                                                GDP Per Capita ($PPP), 2009 ....................................................................................... 12
                                     Figure 6: Pricing and Reimbursement in Europe, Value Based Pricing – Concept and Process .. 16
                                     Figure 7: Pricing and Reimbursement in Europe, ISPOR 33 Guidelines for Pharmacoeconomics
                                                Assessment ................................................................................................................... 19
                                     Figure 8: Pricing and Reimbursement in Europe, Healthcare expenditure % of GDP, 2008 ......... 26
                                     Figure 9: Pricing and Reimbursement in Europe, the UK, NHS expenditure on medicines ($bn) Vs
                                                NHS Medicines 
				
DOCUMENT INFO
Shared By:
Tags:
Stats:
views:61
posted:11/8/2011
language:English
pages:68
Description: Pharmaceutical Pricing and Reimbursement in Europe - Reference Pricing and Similar Initiatives Being Applied to Innovative Drugs Pose Significant Challenge to Pharmaceutical Companies Summary GBI Research, the leading business intelligence provider, has released its latest research “Pharmaceutical Pricing and Reimbursement in Europe - Reference Pricing and Similar Initiatives Being Applied to Innovative Drugs Pose Significant Challenge to Pharmaceutical Companies”. It provides a comprehensive overview of the healthcare system, and pricing and reimbursement process in 12 European nations with a detailed analysis of the different regulatory mechanisms used in these countries. The report closely scrutinizes the major changes in the pharmaceuticals related pricing and reimbursement in these European nations in the recent past and their impact in the near future. The countries analyzed in the report are the top five countries of Europe, Eastern European countries such as Czech Republic, Poland, Romania and Hungary as well as Scandinavian countries such as Norway, Finland and Denmark. GBI Research’s analysis describes healthcare across the 12 European nations, which is largely publicly financed and is provided by health insurance systems; hence, the European governments play a key role in providing healthcare for their citizens. Health is of high priority for Europe’s citizens and pharmaceutical costs are the third most important component in the member states’ healthcare budgets. Currently, the governments of the member countries face substantially rising costs for the provision of health care (average costs are rising at a faster rate than GDP) due to over-prescription of drugs, their irrational usage, and other key factors such as Europe’s ageing population and increasing cost of new medical technologies. Consumer preference for branded drugs to generic drugs in cases where the patent for the drug has expired is also one of the reasons for increasing healthcar
BUY THIS DOCUMENT NOW PRICE: $3500 100% MONEY BACK GUARANTEED
PARTNER GBI Research
GBI Research is a market-leading provider of business intelligence reports. GBI Research covers worldwide markets and issues, supplies actionable data and forecasts and is driven by industry leaders’ insights. GBI Research provides a broad spectrum of reports across the healthcare and energy industries and its online offering is easy to navigate - a comprehensive resource for business information needs. Headquartered in the UK, the company has branches in the US and Asia, and provides world class client support and service.