The cost of entry: An analysis of pharmaceutical registration fees in low-, middle-, and high-income countries.

BACKGROUND: Advances in pharmaceuticals offer improved health outcomes for a wide range of illnesses, yet medicines are often inaccessible for many patients worldwide. One potential barrier to making medicines available to all is the cost of product registration, the fees for regulatory review and licensing for the sale of medicines beyond the cost of clinical trials, if needed. METHODS AND FINDINGS: We performed a cross-sectional analysis of pharmaceutical registration fees in low-, middle-, and high-income countries. We collected data on market authorization fees for new chemical entities and for generic drugs in 95 countries. We calculated measures of registration fee size relative to population, gross domestic product (GDP), and total health spending in each country. Each of the 95 countries had a fee for registering new chemical entities. On average, the ratio of registration fees to GDP was highest in Europe and North America and lowest in South and Central America. Across individual countries, the level of registration fees was positively correlated with GDP and total health spending, with relatively few outliers. DISCUSSION: We find that, generally speaking, the regulatory fees charged by medicines regulatory authorities are roughly proportional to the market size in their jurisdictions. The data therefore do not support the hypothesis that regulatory fees are a barrier to market entry in most countries.

Patients' knowledge and attitude towards therapeutic reference pricing system in Slovenia.

Background The therapeutic reference pricing (TRP) in Slovenia was implemented for proton pump inhibitors in 2013 and for angiotensin-converting enzyme inhibitors and lipid-lowering medicines in 2014. Objective The study aimed to assess patients' knowledge and attitude towards the TRP system. Moreover, the patients' willingness to pay was evaluated for patients who rejected the substitution of a current medicine within a therapeutic class by the reference medicine for which no co-payment is needed. Setting Invitation of patients to participate in a survey and filling in the first part of the questionnaire was run in the community pharmacies in Slovenia. The second part of the questionnaire was filled in at patients' home. Method A representative sample of 676 patients that had been prescribed at least one medicine from the three therapeutic classes was surveyed. The survey was carried out from 15th May to 15th June 2014 in 40 community pharmacies with the help of the pharmacists, who filled in the first part of the questionnaire in the presence of the patients. The second part of the questionnaire was filled in by 475 patients at home and returned by prepaid mail. Main outcome measure Patients' knowledge of and attitude to the TRP system implemented into Slovenian health care practice. Results Most of the statements describing patient' rights and duties within the TRP system were known by approximately 50 % of the patients. Patients were inhomogeneous in their view about the necessity and benefits of the TRP system, most of them regarded it as an unnecessary burden. Among 50.4 % of the patients who were required to copay for their medicine, 46.7 % accepted and 3.7 % rejected co-payment. The average co-payment was € 6.92, while the expressed average willingness to co-pay was € 10.4 per 3 months of therapy. Conclusion Our results indicate that the implementation of the TRP system and potential upgrades represent a significant challenge for the patients.

Pitfalls associated with the therapeutic reference pricing practice of asthma medication.

BACKGROUND: Therapeutic reference pricing (TRP) based on the WHO daily defined dose (DDD) is a method frequently employed for the cost-containment of pharmaceuticals. Our objective was to compare average drug use in the real world with DDD and to evaluate whether TRP based on DDD could result in cost savings on maintenance medication and the total direct health expenditures for asthma patients treated with Symbicort Turbuhaler (SYT) and Seretide Diskus (SED) in Hungary. METHODS: Real-world data were derived from the Hungarian National Health Insurance Fund database. Average doses and costs were compared between the high-dose and medium-dose SYT and SED groups. Multiple linear regressions were employed to adjust the data for differences in the gender and age distribution of patients. RESULTS: 27,779 patients with asthma were included in the analysis. Average drug use was lower than DDD in all groups, 1.38-1.95 inhalations in both SED groups, 1.28-1.97 and 1.74-2.49 inhalations in the medium and high-dose SYT groups, respectively. Although the cost of SED based on the DDD would be much lower than the cost of SYT in the medium-dose groups, no difference was found in the actual cost of the maintenance therapy. No significant differences were found between the groups in terms of total medical costs. CONCLUSIONS: Cost-containment initiatives by payers may influence clinical decisions. TRP for inhalation asthma drugs raises special concern, because of differences in the therapeutic profile of pharmaceuticals and the lack of proven financial benefits after exclusion of the effect of generic price erosion. Our findings indicate that the presented TRP approach of asthma medications based on the daily therapeutic costs according to the WHO DDD does not result in reduced public healthcare spending in Hungary. Further analysis is required to show whether TRP generates additional expenditures by inducing switching costs and reducing patient compliance. Potential confounding factors may limit the generalisability of our conclusions.

Economic outcomes of exenatide vs liraglutide in type 2 diabetes patients in the United States: results from a retrospective claims database analysis.

OBJECTIVE: The safety and efficacy of the GLP-1 receptor agonists exenatide BID (exenatide) and liraglutide for treating type 2 diabetes mellitus (T2DM) have been established in clinical trials. Effective treatments may lower overall treatment costs. This study examined cost offsets and medication adherence for exenatide vs liraglutide in a large, managed care population in the US. METHODS: This was a retrospective cohort analysis comprising adult patients with T2DM who initiated exenatide or liraglutide between 1/1/2010 and 6/30/2010 and had 6 months pre-index and post-index continuous eligibility. Patients were propensity score-matched to controls for baseline differences. Medication adherence was measured by proportion of days covered (PDC). Paired t-test and McNemar's test were used to compare outcomes. RESULTS: Matched exenatide and liraglutide cohorts (n=1347 pairs) had similar average total 6-month follow-up costs ($6688 vs $7346). However, exenatide patients had significantly lower mean pharmacy costs ($2925 vs $3272, p<0.001). Among liraglutide patients, patients receiving the 1.8 mg dose had significantly higher average total costs compared to those receiving the 1.2 mg dose ($8031 vs $6536, p=0.026), with higher mean pharmacy costs in the 1.8 mg cohort ($3935 vs $3146, p<0.001). There were no significant differences in inpatient or outpatient costs or medication adherence between groups (mean PDC: exenatide 56% vs liraglutide 57%, p=0.088). LIMITATIONS: The study assumed that all information needed for case classification and matching of cohorts was present and not differential across cohorts. The study did not control for covariates that were unavailable, such as HbA1c and duration of diabetes. CONCLUSIONS: Patients initiating exenatide vs liraglutide for T2DM had similar medication adherence and total healthcare costs; however, exenatide patients had significantly lower total pharmacy costs. Patients prescribed 1.8 mg liraglutide had significantly higher costs compared to those on 1.2 mg.

How can pharmacist remuneration systems in Europe contribute to generic medicine dispensing? / ¿Cómo pueden contribuir los sistemas de remuneración farmacéutica a la dispensación de medicamentos genéricos?

Generic medicines can generate larger savings to health care budgets when their use is supported by incentives on both the supply-side and the demand-side. Pharmacists’ remuneration is one factor influencing the dispensing of generic medicines. Objective: The aim of this article is to provide an overview of different pharmacist remuneration systems for generic medicines in Europe, with a view to exploring how pharmacist remuneration systems can contribute to generic medicine dispensing. Methods: Data were obtained from a literature review, a Master thesis in Pharmaceutical Care at the Catholic University of Leuven and a mailing sent to all members of the Pharmaceutical Group of the European Union with a request for information about the local remuneration systems of community pharmacists and the possible existence of reports on discounting practices. Results: Pharmacists remuneration in most European countries consists of the combination of a fixed fee per item and a certain percentage of the acquisition cost or the delivery price of the medicines. This percentage component can be fixed, regressive or capped for very high-cost medicines and acts as a disincentive for dispensing generic medicines. Discounting for generic medicines is common practice in several European countries but information on this practice tends to be confidential. Nevertheless, data for Belgium, France, the Netherlands and United Kingdom indicated that discounting percentages varied from 10% to 70% of the wholesale selling price. Conclusion: Pharmacists can play an important role in the development of a generic medicines market. Pharmacists should not be financially penalized for dispensing generic medicines. Therefore, their remuneration should move towards a fee-for-performance remuneration instead of a price-dependent reimbursement which is currently used in many European countries. Such a fee-for-performance remuneration system provides a stimulus for generic medicines dispensing as pharmacists are not penalized for dispensing them but also needs to account for the loss of income to pharmacists from prohibiting discounting practices (AU)

Los medicamentos genéricos pueden producir mayores ahorros a los presupuestos sanitarios cuando se apoyan con incentivos tanto a la oferta como a la demanda. La remuneración de los farmacéuticos es un factor que influye en la dispensación de medicamentos genéricos. Objetivos: El objetivo de este artículo es proporcionar una revisión de diferentes sistemas remunerativos de medicamentos genéricos en Europa, con idea de explorar con la remuneración de los farmacéuticos puede contribuir a la dispensación de genéricos. Métodos: Se obtuvieron datos de una revisión de la literatura, de una tesis de Master en Atención Farmacéutica en la Universidad Católica de Lovaina, y de un correo enviado a todos los miembros del Grupo Farmacéutico de la Unión Europea solicitando información sobre los sistemas locales de remuneración de farmacéuticos comunitarios y la posible existencia de informes sobre las prácticas de descuentos. Resultados: La remuneración de los farmacéuticos en la mayoría de los países europeos consiste en la combinación de una tasa fija por artículo y un cierto porcentaje del precio de compra o del precio de venta del medicamento. Este componente porcentual puede ser fijo, regresivo o con topes para los medicamentos de muy alto coste, y actúa como un desincentivo para dispensar medicamentos genéricos. Los descuentos para medicamentos genéricos son practica común en varios países Europeos, pero la información sobre esta práctica tiende s ser confidencial. Sin embargo, los datos de Bélgica, Francia, Holanda y Reino Unido indican que los porcentajes de descuento varían del 10% al 70% del precio del mayorista. Conclusión: Los farmacéuticos pueden jugar un papel importante en el desarrollo del mercado de genéricos. No se debería penalizar financieramente a los farmacéuticos por dispensar genéricos. Por tanto, su remuneración debería moverse hacia una tasa-por-acto en lugar de un rembolso precio-dependiente, que es lo que ocurre en la mayoría de los países Europeos. Este sistema de remuneración en tasa-por-acto produce estímulos para la dispensación de genéricos, ya que los farmacéuticos no son penalizados por dispensarlos, pero también necesita tener en cuenta las pérdidas de ingresos al prohibir las prácticas de descuentos (AU)

Presenting Germany's drug pricing rule as a cost-per-QALY rule.

In Germany, the Institute for Quality and Efficiency in Health Care (IQWiG) makes recommendations for ceiling prices of drugs based on an evaluation of the relationship between costs and effectiveness. To set ceiling prices, IQWiG uses the following decision rule: the incremental cost-effectiveness ratio of a new drug compared with the next effective intervention should not be higher than that of the next effective intervention compared to its comparator. The purpose of this paper is to show that IQWiG's decision rule can be presented as a cost-per-QALY rule by using equity-weighted QALYs. This transformation shows where both rules share commonalities. Furthermore, it makes the underlying ethical implications of IQWiG's decision rule transparent and open to debate.

Comparison of corticosteroid nasal sprays in relation to concomitant use and cost of other prescription medications to treat allergic rhinitis symptoms: retrospective cohort analysis of pharmacy claims data.

BACKGROUND AND OBJECTIVE: Intranasal corticosteroids are considered to be highly effective in patients with perennial or seasonal allergic rhinitis. Multiple intranasal corticosteroid products are available; however, an intranasal corticosteroid that treats nasal and ocular seasonal allergic rhinitis symptoms may be more cost effective by reducing the need for concomitant drugs. The purpose of this study was to compare the utilization and costs of concomitant allergic rhinitis drugs among commonly used branded intranasal corticosteroid drugs. METHODS: Pharmacy claims data between 1 April 2006 and 31 January 2008 were obtained from the Wolters Kluwer SourceLx dataset. Patients with at least one pharmacy claim for a branded intranasal corticosteroid agent (fluticasone furoate, budesonide, mometasone or triamcinolone) during the index period of 1 April 2007 through 31 July 2007 were included. Study outcomes assessed were time to concomitant use of prescription allergic rhinitis drugs (other than intranasal corticosteroids) and costs of those medications and intranasal corticosteroid drugs during a 60-day post-index period. RESULTS: A total of 793 349 patients were included in the study. At index, a majority of the patients were using mometasone (62.9%), followed by triamcinolone (21.1%), budesonide (15.1%) and fluticasone furoate (1.0%). After controlling for other covariates, patients receiving fluticasone furoate had on average a 21% lower risk of concomitant prescription allergic rhinitis drug use (adjusted hazard ratio [HR] 0.79; 95% CI 0.75, 0.83) compared with the other three branded intranasal corticosteroid agents. Compared with fluticasone furoate, all other branded intranasal corticosteroid agents incurred statistically significant higher costs of concomitant allergic rhinitis drugs (6.3%, p = 0.002), resulting in increased costs to health plans of $US5-$US6 per patient over a 60-day period. Mean intranasal corticosteroid costs per patient during the 60-day follow-up period were lowest for budesonide ($US70.15), followed by fluticasone furoate ($US70.86), triamcinolone ($US73.23) and mometasone ($US75.48). CONCLUSION: In this cohort of intranasal corticosteroid users, fluticasone furoate was shown to reduce the need for concomitant prescription allergic rhinitis medications compared with other leading branded intranasal corticosteroid therapies, resulting in lower costs per patient and potentially leading to significant savings for health plans.

OFT, VBP: QED?

The report by the Office of Fair Trading (OFT) on the UK pharmaceutical price regulation scheme (PPRS) recommends the reform of the current scheme, which is a combination of profit and price controls, to one where price is based on the health benefits offered by a pharmaceutical. On closer examination some of the more commonly expressed concerns about these proposals do not seem to be well founded. In principle, the OFT's recommendations may contribute to allocative and dynamic efficiency in the NHS. However, there are some dangers and the details of how it will be implemented are crucial. For example, value-based pricing with an inappropriate threshold for cost-effectiveness, or an inappropriate pricing structure, could lead to technologies being adopted at prices where their benefits, in terms of health outcome, do not offset the health displaced elsewhere in the NHS, a situation in which the NHS is damaged rather than improved by innovation. A failure to account for uncertainty and the value of evidence in negotiating prices and coverage could also undermine the evidence base for future NHS practice. Whatever view is taken, the OFT report will inevitably shape the scope of future policy debates about value, guidance, price and innovation.

[Pharmaceutical reference pricing in Germany: definition of therapeutic groups, price setting through regression procedure and effects]. / Arzneimittelfestbeträge: Gruppenbildung, Preisberechnung mittels Regressionsverfahren und Wirkungen.

The German reference pricing system defines a reimbursement threshold for groups of pharmaceuticals. Pharmaceuticals are grouped according to certain criteria by the Federal Joint Committee. To make different active ingredients comparable, so called reference values are defined. Subsequently, the federal association of sickness funds sets reference prices using a regression procedure. However, the impact of the reference price system is limited. On the one hand there is a strong incentive for pharmaceutical companies to decrease prices to the reference price. On the other hand there is no incentive for further price reductions. Additionally, only one part of the pharmaceutical market is affected by reference pricing. Therefore the instrument has only managed to lower pharmaceutical expenditure in the short run. For sustainable long-term cost containment the use of other regulatory instruments is necessary. Nevertheless, compared to other instruments of price-regulation, reference pricing seems to be a good alternative to control pharmaceutical prices, since rationing is kept as little as possible.

[Medical problems associated with the national reference pricing system in Hungary]. / A hazai referencia gyógyszerárképzés orvosszakmai problémái.

The author analyses the medical problems associated with the proposed reference pricing system prepared for the 2004 pharmaceutical price and reimbursement negotiations by the Hungarian National Health Insurance Fund (HNIF). In case of drugs containing identical active ingredients the author does not consider it acceptable that from the criteria of reference grouping bioequivalence was omitted, since bioequivalence is the basic clinical pharmacologic principle underlying the safe utilization of generic drugs. The proposal introduces in Hungary the therapeutic reference pricing for drugs belonging to the same ATC 5 level group, having different chemical structures but identical mechanisms of action. The products are listed according to their defined daily dose (DDD) and the arithmetic mean of the cheapest products giving together 50% market share is calculated. Each ATC 5 group has a given per cent reimbursement level and the fixed amount paid by the HNIF for all drugs in the group is defined as the given percentage of the mean price. This sum is reimbursed irrespective whether the products are patent protected or not, furthermore those drugs whose price is three times higher than the fixed mean price are excluded from the reimbursement system. As a result the patients' co-payment for the more expensive drugs will be significantly increased in the future. The basis of the therapeutic reference price is the assumption that the outcome of the treatment will be the same using drugs with the same mechanism of action. However, this assumption lacks valid scientific proof. According to the author, the proposed budget centric reference pricing system, which does not take into account the differing clinical pharmacologic profiles of the drugs, will significantly inhibit the use of new, innovative drugs, the establishment and continuous improvement of truly cost-effective patient care. Several alternative approaches are proposed for controlling drug budget. Finally the author recommends that a Committee should be established to develop a comprehensive proposal for the reorganization of the pricing and reimbursement system of the drugs available for general and/or hospital use, and for the follow-up of the health care effects of these measures.

Managing prescription drug costs: a case study.

Pharmacy costs in most private insurance companies and public concerns have risen over the past several years. To address the problem of increased expenditures in its government employee pharmacy program, the State of New York sought bids from outside vendors to help it control pharmaceutical costs. The following is a case study of the tools the state employed in that effort. Over time, both prescription drug coverage and mental health and substance abuse benefits were carved out of the medical plan and are now provided under free-standing programs. In order to participate, an independent pharmacy must accept a discount of 10% off the average wholesale price of brand name drugs and 25% off the average generic price of generic drugs.

Current status of drug information centers.

The current status of drug information centers in the United States and trends that have developed over the past two decades were studied. In February 1990, questionnaires were sent to 218 pharmacist-operated drug information centers nationwide. The centers were identified through previously published directories and the ASHP electronic bulletin board PharmNet. The survey consisted of 182 questions designed to gather updated data on each drug information center. Responses to each question were coded individually, and data were analyzed by using a statistical analysis program. One hundred fifty-four drug information centers responded; of these, 130 provided usable responses. The results showed that the number of drug information centers has increased compared with earlier surveys. Also, the centers handle substantially larger workloads. Few drug information centers indicate a fee-for-service system. Computer use and online searching by drug information centers have increased. Most of the centers participate in the formal education of pharmacy students. Increases in the number of drug information centers and in their workload substantiate the growing importance of these centers to the health-care professions.

[Current problems in assessing drug prices]. / Problemi atuali in tema di fissazione del prezzo dei farmaci.

Two reasons provide historical justification for controlling drug prices: safeguarding the consumer and safeguarding public demand. Due to the increased presence of the "third payer" in public health systems this second reason has become more important. Nevertheless, over the last decade, a third purpose has attached to public control of prices: promotion of drug manufacturers economic development. The justification offered for this is that development of pharmaceutical companies contributes to the economic growth of the host country by creating employment, exports and research activity. The situations in Germany, Great Britain and United States are often cited in support of this thesis. As a model for price policy in Italy, however, it has not been successful. The rapid growth of prices in fact has not created greater employment and the foreign exchange deficit has risen rapidly. In other words the growing cost of drugs to the National Health Service has not produced hoped-for economic benefits. It would therefore be opportune to modify the mechanisms of price control by seeking a better balance in the interests involved (safeguarding public demand versus manufacturers economic growth). Methodologies available point to the evaluation of the therapeutic utility of a drug as a useful tool for this purpose. By this method the price of a new drug may only be higher than that of a drug already on the market if its therapeutic utility (which does not coincide only with clinical effectiveness) is greater. Appropriate evaluation techniques of benefits deriving from a new drug (cost-effectiveness and cost-utility) do exist and can be taken into consideration in a new method of calculating drug price.