Country Report: Austria - Pharmaceutical Executive


Country Report: Austria

Pharmaceutical Executive

Elisabeth Prchla, Managing Director, Merck GmbH
Elisabeth Prchla, managing director of Merck Austria, points out that "the pharmaceutical industry has been the prime target for cost containment measures which has meant that patient access to innovative medicines is difficult." Prchla believes that, together with the Austrian industry associations, it is fundamental for companies like Merck "to cooperate with politicians and payers in order to develop conditions that allow easier patient access to innovative medicines."

Karl Peter Schwarz, Managing Director, Leo Pharma GmbH
One way in which pharmaceutical companies are dealing with this is by voluntarily paying back EUR 82 million (USD 111.1 million) into Austria's health system until 2015, which will then be reinvested by the Austrian government into various pilot healthcare projects, mainly focused on prevention and child healthcare. This historic deal involved all stakeholders in the pharmaceutical industry consenting unanimously to this agreement, which is rarely seen in other countries.


Karl Nikitsch, Country Manager, A.Menarini Pharma GmbH
In 2004, a new "traffic light" system for reimbursement was implemented that significantly altered the way in which pharmaceutical companies are reimbursed for their products. Essentially, products can be placed in one of three boxes. The green box includes all drugs that are automatically reimbursed by the government. The yellow box consists of drugs that are only reimbursed under special conditions that meet tightly defined rules for reimbursement, and the red box contains drugs that are highly unlikely to be reimbursed.

Savings in Austria for generics in 2011
According to Jan Oliver Huber, general secretary of the Austrian pharmaceutical association PHARMIG, this change in the system caused slower growth rates in subsequent years because of stakeholders' natural cautiousness and the time needed to adapt to this new structure. Like other European countries, Austria's population is ageing. "Considering two thirds of all prescriptions paid by the reimbursement system are destined for this age group, there is a natural, organic growth in Austria because of the demographics," remarks Huber. "But this growth has not been steady: in 2005, the market grew by 1.65 percent whereas it grew by 8.29 percent in 2007 and by 7.41 percent in 2008."

Bernd Leiter, President, Austrian Generics Association
Entering this reimbursement system is not an easy process either. Karl Peter Schwarz, managing director of LEO Pharma Austria describes the system as being rigid. "It is very difficult to discuss the added value for patients, which is reflected in any product price," he notes. "The maximum price of a drug within the reimbursement system in Austria is the EU average price," continues Schwarz. "If your product is already on the reimbursement list in other European markets, you have to inform the Minister of Health, after which a price commission gives you clearance." Karl Nikitsch, country manager of Menarini Austria, notes that "the market shares of some products are relatively high compared to other, much bigger, European markets. In spite of the hurdles Menarini faces in terms of market access, such as new products instantly falling into the yellow box category with many restrictions, there are green lights once this difficult stage has passed. In other countries, companies may need to renegotiate the presence of their product in the reimbursement system, such as Germany," Nikitsch says.


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Source: Pharmaceutical Executive,
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