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Friday, 29 January 2010 05:00 GMT
Innovative pharma open to German government talks on medicines' savings
by Philippe Wackel
BERLIN, Jan 29 (APM) - Trade groups representing the research-based drugs industry said they are open to discussing savings on medicines with the German health minister, but the generics industry said the minister was mistaken on discount price contracts.
Federal Health Minister Philipp Rösler said in an interview published in Thursday's Frankfurter Allgemeine Zeitung newspaper he will meet representatives from the pharmaceutical industry and health insurers to discuss ways of finding savings on medicines (see Thursday's APM story - 'German health minister says will seek drugs savings - press').
A health ministry spokeswoman told APM the minister will first meet the health insurers' umbrella organisation, the GKV-Spitzenverband, in mid February and pharma trade associations later on.
The GKV-Spitzenverband said recently that regarding new and expensive medicines, it called for the introduction of a negotiation mechanism between manufacturers and itself or even the introduction of price-setting by the state.
In separate reactive statements to the minister's interview, the two trade groups representing innovative pharmaceutical producers in Germany hailed the minister's proposal to hold talks and said they were open for dialogue on the issue.
"MINISTER IS RIGHT," SAYS VFA
"Federal Minister Rösler is right. Given the situation, the question of how efficient each actor in the healthcare sector is cannot be avoided. The research-based pharmaceutical companies are also asking themselves this question," said the association of research-based pharmaceutical companies (Verband Forschender Arzneimittelhersteller, VFA).
The VFA added: "We are convinced that our products provide benefits to the healthcare system and that we can justify their prices.
"Our offer is still valid to accompany in a constructive way the Institute for Quality and Efficiency in Healthcare IQWiG, which has been assigned a long time ago to conduct assessments based on international standards."
The VFA also reiterated that it was willing to sign contracts with insurers. "The industry, politicians and health insurers have now to discuss the necessary framework," it said.
BPI WARNS AGAINST "HECTIC REACTIONS"
The other research-based pharma organisation, the German Federal Association of the Pharmaceutical Industry (Bundesverband der Pharmazeutischen Industrie, BPI) said in an e-mailed statement it welcomed that the minister was seeking to have discussions with the industry "to find a way out of the financial predicament in which the health insurers find themselves".
However, the BPI warned that "hectic reactions" would do no good to the system. In particular, the association pointed out that "further cost cutting would endanger an industry which has production facilities in Germany".
The BPI also said it has developed a model on patent-protected medicines' pricing, "which could allow health insurers to save money without undermining the quality of care and without hindering companies to keep researching and developing new medicines".
That would involve producers negotiating with individual insurers on the price of new drugs. When 30% of the health insurance market is thus covered, all health insurers would be offered the product at the average price of all the single agreements.
However, if the market level of 30% is not reached within five years, then the price would be negotiated centrally with the GKV-Spitzenverband, with representatives from the health ministry and the ministry of economy participating in the negotiations.
PRO GENERIKA LESS UPBEAT
The generics producers' trade association, Pro Generika, is less upbeat and believes the health minister is mistaken about discount price contracts between generics producers and insurers.
In the interview with the Frankfurter Allgemeine Zeitung, the health minister said: "We will not focus solely on innovative medicines but we will look at every area in the pharmaceutical market."
Referring to the discount price contracts - a system that allows health insurers to select the product with the lowest price for any off-patent active ingredient - the minister said: "I know that colleagues within my party [the Free Democratic Party, FDP] have criticised the discount price contracts. But it is also a fact that these contracts have brought advantages to the insured, because prices have significantly been cut and the spending growth has been reduced."
Pro Generika said in a statement that "the minister is mistaken on two points".
According to the association, the discount price contracts failed to bring any advantages to the insured, contrary to what the minister says.
Millions of patients have had to switch to products they were not accustomed to, but they did not reap any financial profits because the low prices of the drugs under contracts did not offset the continuing increase of expenditure linked to patent-protected drugs, said the association.
Pro Generika also believes that discount price contracts are destroying in the long run the generics industry, by forcing companies to impose major price cuts on their products.
Consequently, some generics firms are relocating - or are planning to do so - their production outside Germany and are slashing jobs, in contrast to small and mid-sized generics companies which are running the risk of simply disappearing, ProGenerika added.
pw/nh
[17931] 29/01/2010 05:00 GMT - INDUSTRY
BERLIN, Jan 29 (APM) - Trade groups representing the research-based drugs industry said they are open to discussing savings on medicines with the German health minister, but the generics industry said the minister was mistaken on discount price contracts.
Federal Health Minister Philipp Rösler said in an interview published in Thursday's Frankfurter Allgemeine Zeitung newspaper he will meet representatives from the pharmaceutical industry and health insurers to discuss ways of finding savings on medicines (see Thursday's APM story - 'German health minister says will seek drugs savings - press').
A health ministry spokeswoman told APM the minister will first meet the health insurers' umbrella organisation, the GKV-Spitzenverband, in mid February and pharma trade associations later on.
The GKV-Spitzenverband said recently that regarding new and expensive medicines, it called for the introduction of a negotiation mechanism between manufacturers and itself or even the introduction of price-setting by the state.
In separate reactive statements to the minister's interview, the two trade groups representing innovative pharmaceutical producers in Germany hailed the minister's proposal to hold talks and said they were open for dialogue on the issue.
"MINISTER IS RIGHT," SAYS VFA
"Federal Minister Rösler is right. Given the situation, the question of how efficient each actor in the healthcare sector is cannot be avoided. The research-based pharmaceutical companies are also asking themselves this question," said the association of research-based pharmaceutical companies (Verband Forschender Arzneimittelhersteller, VFA).
The VFA added: "We are convinced that our products provide benefits to the healthcare system and that we can justify their prices.
"Our offer is still valid to accompany in a constructive way the Institute for Quality and Efficiency in Healthcare IQWiG, which has been assigned a long time ago to conduct assessments based on international standards."
The VFA also reiterated that it was willing to sign contracts with insurers. "The industry, politicians and health insurers have now to discuss the necessary framework," it said.
BPI WARNS AGAINST "HECTIC REACTIONS"
The other research-based pharma organisation, the German Federal Association of the Pharmaceutical Industry (Bundesverband der Pharmazeutischen Industrie, BPI) said in an e-mailed statement it welcomed that the minister was seeking to have discussions with the industry "to find a way out of the financial predicament in which the health insurers find themselves".
However, the BPI warned that "hectic reactions" would do no good to the system. In particular, the association pointed out that "further cost cutting would endanger an industry which has production facilities in Germany".
The BPI also said it has developed a model on patent-protected medicines' pricing, "which could allow health insurers to save money without undermining the quality of care and without hindering companies to keep researching and developing new medicines".
That would involve producers negotiating with individual insurers on the price of new drugs. When 30% of the health insurance market is thus covered, all health insurers would be offered the product at the average price of all the single agreements.
However, if the market level of 30% is not reached within five years, then the price would be negotiated centrally with the GKV-Spitzenverband, with representatives from the health ministry and the ministry of economy participating in the negotiations.
PRO GENERIKA LESS UPBEAT
The generics producers' trade association, Pro Generika, is less upbeat and believes the health minister is mistaken about discount price contracts between generics producers and insurers.
In the interview with the Frankfurter Allgemeine Zeitung, the health minister said: "We will not focus solely on innovative medicines but we will look at every area in the pharmaceutical market."
Referring to the discount price contracts - a system that allows health insurers to select the product with the lowest price for any off-patent active ingredient - the minister said: "I know that colleagues within my party [the Free Democratic Party, FDP] have criticised the discount price contracts. But it is also a fact that these contracts have brought advantages to the insured, because prices have significantly been cut and the spending growth has been reduced."
Pro Generika said in a statement that "the minister is mistaken on two points".
According to the association, the discount price contracts failed to bring any advantages to the insured, contrary to what the minister says.
Millions of patients have had to switch to products they were not accustomed to, but they did not reap any financial profits because the low prices of the drugs under contracts did not offset the continuing increase of expenditure linked to patent-protected drugs, said the association.
Pro Generika also believes that discount price contracts are destroying in the long run the generics industry, by forcing companies to impose major price cuts on their products.
Consequently, some generics firms are relocating - or are planning to do so - their production outside Germany and are slashing jobs, in contrast to small and mid-sized generics companies which are running the risk of simply disappearing, ProGenerika added.
pw/nh
[17931] 29/01/2010 05:00 GMT - INDUSTRY
