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How can pricing and reimbursement policies improve affordable access to medicines? Lessons learned from European countries

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  • Vogler, Sabine
  • Paris, Valérie
  • Ferrario, Alessandra
  • Wirtz, Veronika J.
  • Joncheere, Kees de
  • Schneider, Peter
  • Pedersen, Hanne Bak
  • Dedet, Guillaume
  • Babar, Zaheer-Ud-Din

Abstract

This article discusses pharmaceutical pricing and reimbursement policies in European countries with regard to their ability to ensure affordable access to medicines. A frequently applied pricing policy is external price referencing. While it provides some benchmark for policy-makers and has been shown to be able to generate savings, it may also contribute to delay in product launch in countries where medicine prices are low. Value-based pricing has been proposed as a policy that promotes access while rewarding useful innovation; however, implementing it has proven quite challenging. For high-priced medicines, managed-entry agreements are increasingly used. These agreements allow policy-makers to manage uncertainty and obtain lower prices. They can also facilitate earlier market access in case of limited evidence about added therapeutic value of the medicine. However, these agreements raise transparency concerns due to the confidentiality clause. Tendering as used in the hospital and offpatent outpatient sectors has been proven to reduce medicine prices but it requires a robust framework and appropriate design with clear strategic goals in order to prevent shortages. These pricing and reimbursement policies are supplemented by the widespread use of Health Technology Assessment to inform decision-making, and by strategies to improve the uptake of generics, and also biosimilars. While European countries have been implementing a set of policy options, there is a lack of thorough impact assessments of several pricing and reimbursement policies on affordable access. Increased cooperation between authorities, experience sharing and improving transparency on price information, including the disclosure of confidential discounts, are opportunities to address current challenges.

Suggested Citation

  • Vogler, Sabine & Paris, Valérie & Ferrario, Alessandra & Wirtz, Veronika J. & Joncheere, Kees de & Schneider, Peter & Pedersen, Hanne Bak & Dedet, Guillaume & Babar, Zaheer-Ud-Din, 2017. "How can pricing and reimbursement policies improve affordable access to medicines? Lessons learned from European countries," LSE Research Online Documents on Economics 68862, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:68862
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    1. David H. Howard & Peter B. Bach & Ernst R. Berndt & Rena M. Conti, 2015. "Pricing in the Market for Anticancer Drugs," Journal of Economic Perspectives, American Economic Association, vol. 29(1), pages 139-162, Winter.
    2. David H. Howard & Peter B. Bach & Ernst R. Berndt & Rena M. Conti, 2015. "Pricing in the Market for Anticancer Drugs," NBER Working Papers 20867, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Wettstein, Dominik J. & Boes, Stefan, 2022. "How value-based policy interventions influence price negotiations for new medicines: An experimental approach and initial evidence," Health Policy, Elsevier, vol. 126(2), pages 112-121.
    2. Kyung-Bok Son, 2020. "Is greater generic competition also linked to lower drug prices in South Korea?," Health Economics Review, Springer, vol. 10(1), pages 1-9, December.
    3. Iyn-Hyang Lee & Karen Bloor & Eun-Young Bae, 2023. "A Comparative Analysis of Anticancer Drug Appraisals Including Managed Entry Agreements in South Korea and England," Applied Health Economics and Health Policy, Springer, vol. 21(2), pages 347-359, March.
    4. Luka Vončina & Tea Strbad & Jurij Fürst & Maria Dimitrova & Maria Kamusheva & Megi Vila & Ileana Mardare & Kristina Hristova & Andras Harsanyi & Dragana Atanasijević & Igor Banović & Ana Bobinac, 2021. "Pricing and Reimbursement of Patent-Protected Medicines: Challenges and Lessons from South-Eastern Europe," Applied Health Economics and Health Policy, Springer, vol. 19(6), pages 915-927, November.
    5. Sabine Vogler & Guillaume Dedet & Hanne Bak Pedersen, 2019. "Financial Burden of Prescribed Medicines Included in Outpatient Benefits Package Schemes: Comparative Analysis of Co-Payments for Reimbursable Medicines in European Countries," Applied Health Economics and Health Policy, Springer, vol. 17(6), pages 803-816, December.
    6. Marcelien H. E. Callenbach & Rick A. Vreman & Aukje K. Mantel-Teeuwisse & Wim G. Goettsch, 2022. "When Reality Does Not Meet Expectations—Experiences and Perceived Attitudes of Dutch Stakeholders Regarding Payment and Reimbursement Models for High-Priced Hospital Drugs," IJERPH, MDPI, vol. 20(1), pages 1-12, December.
    7. Jaime Espin & Michael Schlander & Brian Godman & Pippa Anderson & Jorge Mestre-Ferrandiz & Isabelle Borget & Adam Hutchings & Steven Flostrand & Adam Parnaby & Claudio Jommi, 2018. "Projecting Pharmaceutical Expenditure in EU5 to 2021: Adjusting for the Impact of Discounts and Rebates," Applied Health Economics and Health Policy, Springer, vol. 16(6), pages 803-817, December.
    8. Sabine Vogler & Kenneth R. Paterson, 2017. "Can Price Transparency Contribute to More Affordable Patient Access to Medicines?," PharmacoEconomics - Open, Springer, vol. 1(3), pages 145-147, September.
    9. Melanie Büssgen & Tom Stargardt, 2023. "Does health technology assessment compromise access to pharmaceuticals?," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 24(3), pages 437-451, April.
    10. Carolina Zampirolli Dias & Brian Godman & Ludmila Peres Gargano & Pâmela Santos Azevedo & Marina Morgado Garcia & Maurílio Souza Cazarim & Laís Lessa Neiva Pantuzza & Nelio Gomes Ribeiro-Junior & Andr, 2020. "Integrative Review of Managed Entry Agreements: Chances and Limitations," PharmacoEconomics, Springer, vol. 38(11), pages 1165-1185, November.
    11. Dominik J. Wettstein & Stefan Boes, 2019. "Effectiveness of National Pricing Policies for Patent-Protected Pharmaceuticals in the OECD: A Systematic Literature Review," Applied Health Economics and Health Policy, Springer, vol. 17(2), pages 143-162, April.
    12. Bence Kovács & Miklós Darida & Judit Simon, 2021. "Drugs Becoming Generics—The Impact of Genericization on the Market Performance of Antihypertensive Active Pharmaceutical Ingredients," IJERPH, MDPI, vol. 18(18), pages 1-20, September.
    13. Vogler, Sabine & Fischer, Stefan, 2020. "How to address medicines shortages: Findings from a cross-sectional study of 24 countries," Health Policy, Elsevier, vol. 124(12), pages 1287-1296.
    14. Sabine Vogler & Peter Schneider & Nina Zimmermann, 2019. "Evolution of Average European Medicine Prices: Implications for the Methodology of External Price Referencing," PharmacoEconomics - Open, Springer, vol. 3(3), pages 303-309, September.
    15. Irene Eriksson & Mia von Euler & Rickard E. Malmström & Brian Godman & Björn Wettermark, 2019. "Did we see it Coming? An Evaluation of the Swedish Early Awareness and Alert System," Applied Health Economics and Health Policy, Springer, vol. 17(1), pages 93-101, February.

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    • I10 - Health, Education, and Welfare - - Health - - - General

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