EU Must Address Polarization of Health Policy Debate

December 21, 2018

As the EU prepares for a change of governance, policymakers should take note of recent comments about the "poisoned atmosphere" surrounding healthcare policy debates, writes Reflector.

It’s that time again when the talk among pharmaceutical executives turns to plans for the new year. But in Europe, this year is different, because what happens in 2019 will influence what happens right through to the mid 2020s and beyond – and I’m not talking about Brexit. I’m talking about what may be toxic for healthcare – as one of Europe’s most senior officials remarked in a recent discussion of the future.

The game-changer is going to be the shift in the governance of the European Union (EU), as a new European Parliament is elected, a new European Commission takes office, and a new president is appointed to the European Council. Like it or not, business life in the European Union is increasingly the consequence of deliberations and decisions among this triad of institutions. The headlines may often focus on spats over migration policy or press freedom or the appointment of judges in recalcitrant member states, or the cooling of EU links with the White House, or the peculations of the occasional MEP or junior official. Commentators may conjure up images of an EU exhausted by internal divisions and devoid of direction or conviction. But the reality is that the EU is still the only show in town in this part of the world (and that includes the UK, even it drops out of membership), and is still a major player in the rest of the world too.

So, who takes over the strategic direction of the EU in 2019 matters, and so do the policies that they embrace. They will be running things for the next five years, and what they decide during that time will have its impact right through the decade.

For pharmaceutical executives, the two key trends to watch in this unfolding panorama are obviously the evolution of business policy on the one hand, and on the other hand the climate in which healthcare is discussed. This is where the “toxic” element comes into the picture.

It was at the conclusion of a full day’s recent reflections on EU healthcare that the European Commission’s deputy director general for health, Martin Seychell, warned that there was a poisoned atmosphere in healthcare policy debates. After hours of earnest presentations from patients, doctors, academics and politicians extolling the merits of working together, Seychell pointed to the elephant in the room that everyone else had tiptoed around: “At political level the discussion on health is still very polarized, in terms of innovation versus access, or technology being good or bad.”

His comment reflected the continuing failure of EU health policy to reconcile industrial and social imperatives. And that failure springs from rival visions over the role of the pharmaceutical industry. An influential EU-funded campaigning organization, the European Public Health Alliance, states clearly that its aim is to seek “reforms to the current pharmaceutical business model”, in response to “the growing risk to patients and healthcare systems from the increasing costs of medicines”.

The ambition is representative of widespread concern over – and even palpable hostility to – the pharmaceutical industry in Europe. Health Action International, another prominent campaigning group, is currently running a campaign that focuses on “true R&D costs”, demanding companies open up their books to show “how much of it was paid for by taxpayers”. HAI says: “With doctors, patients, insurers and hospitals all warning that prices for new medicines are unsustainable, the time has come to restore power to taxpayers by demanding an open and transparent industry.” A recent WHO report on medicines shortages was criticised by campaigners for recommending “a fair price” for medicines: “The opaqueness around R&D cost has been long used to justify high, even exorbitant, prices for patented medicines. The fair price to provide incentives for innovation would then legitimise the high prices for medicines and compromise access to medicines,” they argued.

An ‘Elections manifesto 2019’ created by the European Patients’ Forum urges the EU to involve patients in setting ground rules for research involvement “in order to produce valuable innovation”, and to avoid “duplication and waste in research”.

It is not only health campaigners who take a critical view. So too do reimbursement agencies. One of the leading healthcare payers’ organizations in Europe, AIM, has been calling for tougher controls on drug pricing and tighter limits on the award of incentives to drug developers in its manifesto for the coming five years. It questions the merits of many products: “While the prices are high, the true added value of these medicines is sometimes unclear.” And AIM’s manifesto won the explicit backing of European health commissioner Vytenis Andriukaitis, who has become increasingly critical of drug industry pricing practices.

Ri De Ridder, who stepped down in 2018 after twelve years at the head of Belgium’s reimbursement agency, immediately accused national pricing authorities of acting like “hostages”, so that “at present, the price paid for drugs is the price that any fool is ready to pay.” 

A group of experts appointed by the EU to examine options in pricing commented that the practice of managed entry agreements carries a risk of “abuse of market power”, and accused companies of adapting their pricing strategies so as to “keep effective prices secret”. It recommended reimbursement agencies to seek disclosure of “R&D costs, marketing costs and production costs”, and competition authorities to conduct a review of “high prices asked by companies”.

European spending on pharmaceuticals is criticized for its laxity in a report published towards the end of 2018 by the European Commission and the OECD, which counsels countries in the region to adopt stricter controls so as to cut waste and get better value.

Member state governments – and EU presidencies too – are frequently critical. During its presidency of the EU Council of Ministers during 2018, Bulgaria said it was “unacceptable” that the market should be “used as an excuse for issues and critical situations with pharmaceuticals,” and that “the health perspective should be central to all pharmaceuticals-related discussions.”

And never a debate on any aspect of pharmaceuticals in the European Parliament takes place without MEPs referring to the challenges of access to medicines with the current business model.

Attitudes of this nature will colour the debates on the future as the incoming administration in the EU takes shape. As EPHA argues, “the next European Commission should have a clear, robust mandate to prioritize health” – and for EPHA this means defending public health, and not “repeating pro-business arguments”.

The loudest voices in health policy discussions tend to focus on the need for controls on pricing so as to promote sustainability of health systems. By contrast, Europe support for innovation and for private-sector enterprise is often more diffuse, and more muted.

Unsurprisingly, the main European association representing the research-based drug industry, EFPIA, makes the case for its members. In an informal manifesto for 2019, its director general Nathalie Moll argues that the EU must take intellectual property protection more seriously, and develop “a smart sectorial industrial policy and pro-innovation environment.” This means “bringing innovative health solutions to all patients and making the EU a world leader in research and development”, she says.

Moll’s recipe for bridging the divide between social and industrial imperatives is the promotion of closer partnership. She may find partners among officials like Martin Seychell, who recognizes that it is time to move away from “the toxic debate” on innovation and access and prices of medicines. But there are a lot of other potential partners who may need a lot more convincing over the coming months if European pharmaceutical executives are going to be able to look forward with confidence to the coming years.