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

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

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 healthcare costs. Austerity packages announced by the countries are incorporating demand side and supply side policies to reduce the fiscal burden of which healthcare costs command a major proportion. The governmental demand side policies include measures that affect the reimbursements of drugs such as positive and negative lists, cost sharing, reference pricing, risk-sharing contracts, tenders, pay-back arrangements and other provisions aimed at a more rational use of pharmaceutical products and making demand more price sensitive. The most applied supply policy is price regulation which includes price control and price negotiation. The specific features of individual policies vary significantly across the member states. Single pricing mechanism is still an issue in the Europe.

Scope

- Detailed study of the healthcare systems and roles of the key players in the respective pharmaceutical systems of top five countries of Europe – the UK, France, Germany, Italy and Spain; Eastern European countries of Czech Republic, Poland, Hungary, and Romania; and Scandinavian countries of Norway, Denmark and Finland.
- Analysis of the major pricing and reimbursement mechanisms in each country.
- Key trends that follow from the recent changes brought about in the pricing and reimbursement mechanism.
- Build an understanding of the possible major challenges brought about by the enactment of changes in the pricing and reimbursement scene in the countries covered.

Reasons to buy

- Build understanding of the pharmaceuticals related key pricing and reimbursement mechanisms in the key markets of Europe.
- Optimize your investment through identification and understanding of the changes in the pharmaceuticals regulatory mechanism in the economies.
- Develop effective business strategies related to new drug launches through the analytical insight gained from key trends in pricing and reimbursement scene for the countries covered.
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
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

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 ($bn) Vs NHS Medicines Cost per capita ($), 2000-2009 27
Figure 10: Pricing and Reimbursement in Europe, European Counties, the US, Japan, Total Healthcare Expenditure vs Out-of-Pocket Expenditure in European Countries, 2009 31
Figure 11: Pricing and Reimbursement in Europe, Pharmaceutical Expenditure Per Capita Among the Highest in France, $PPP, 2007-2008 33
Figure 12: Pricing and Reimbursement in Europe, LFSS 2011 34
Figure 13: Pricing and Reimbursement in Europe, Germany, Healthcare Expenditure, $ per inhabitant, 2008 40
Figure 14: Pricing and Reimbursement in Europe, Germany, Cost Containment Measures, 1980-2011 42
Figure 15: Pricing and Reimbursement in Europe, Germany, Structural Reforms by AMNOG, 2011 43
Figure 16: Pricing and Reimbursement in Europe, Romania, Key Aspects of New Pharmaceutical Regulations 57