Europe's Transparency Directive Revisited - Pharmaceutical Executive

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Europe's Transparency Directive Revisited


Pharmaceutical Executive


Even the Netherlands, in many respects a pillar of rectitude in industrial policy, wants longer to make its decisions. "The time limit of 90 days has proven to be too tight for making decisions on the reimbursement status of medicines," it says. "Since 1989, the evaluation procedure of reimbursement applications for new medicines has become more complex," so "especially when a pharmacoeconomic evaluation is part of the evaluation process, the time limit of 90 days is too short," it insists. "Time limits should be extended to allow for the increased complexity of reimbursement procedures."

The health authorities in the Czech Republic—which, like Poland, joined the EU long after the legislation was introduced—are not happy with the directive either, and in their case it is because they feel too constrained by it, and want greater liberty to knock products off the reimbursement list. The combined impacts of the directive and of its interpretation by the European Court of Justice "make every change of national reimbursement measures very hard, even impossible," they say. Paying no more than lip service to one of the central tenets of the European Union (and one of the explicit justifications for the directive), they remark dismissively that "the free movement of goods is very important," but go on to insist that, notwithstanding, "National government should have more freedom to decide or change its opinion in a fast and flexible way that some categories of medicinal products will not be covered by the national health insurance system anymore."

Out of Options?

The way the debate is shaping up at present is not leaving much room for the more nuanced approaches that the European pharmaceutical industry would like to see taken account of. Richard Bergstrom, Director General of EFPIA, recently spelled out the real dilemma in the pricing and market access challenges facing the research-based pharmaceutical industry.

Of course payers have the right to assess the added value of new medicines, he acknowledged. In the course of that assessment, companies are ready to make their case. But the case will inevitably adopt wider perspectives of value than are, for instance, currently allowed for in the transparency directive. Company arguments will embrace concepts such as the value for the individual patient as opposed to the average, and the economic value of a treatment to society, rather than just to the budget of a clinic. "Added value should be recognized and rewarded," he insisted, addressing industry colleagues in Austria.

There should be some quid pro quos for this, he recognized. Once patents expire, prices, of course, should fall to a lower level, for instance. Increased use of generics is necessary to free up some of the healthcare budget to fund innovation, EFPIA accepts. Another corollary of recognizing added value is that there should indeed be greater transparency—real transparency, and not just a fig leaf—about prices.

But the big problem in all this for the innovative pharmaceutical industry in Europe is what use national authorities should be allowed to make of the information. At present, most European countries take into consideration prices in other countries when they make their own decisions. This could prove catastrophic, suggests EFPIA, if prices in the lowest-price countries become the dominant influence across the region—if, as Bergstrom put it, Denmark and Norway start limiting their prices to the same level that is fixed by Greece. How far a modified transparency directive will prevent such an outcome is something industry is reflecting on with increasing anxiety.

Reflector is Pharm Exec Europe's anonymous columnist, a commentator so close to the action in Europe that his identity must remain secret.


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