FIP Congress 2006
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The Administrative Pharmacy Section organised a
session on international diversity in drug pricing policies. Steven
Kayne reports
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 The World Congress of Pharmacy and Pharmaceutical Sciences,
the 66th International FIP Congress, was organised by the International
Pharmaceutical Federation in association with the Federal
Council of Pharmacy of Brazil.
It took place in Salvador da Bahia from August 26 to 31, 2006
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Medicines pricing in a global market
With medicines price differences between countries decreasing, could
parallel trade have a limited life, asked Tony Björk, executive
director of corporate communications, Apoteket AB, Sweden.
The way in which the price of medicines is set can impact on a range
of stakeholders including manufacturers, wholesalers, pharmacies, funding
bodies and consumers, he said. Consumers are most concerned about accessing
medicines as cheaply as possible, leaving third party payers with a dilemma.
Payers
such as governments and insurers will generally reimburse the costs of
prescription medicines but often the patient may be expected
to contribute financially through a co-payment.
Evidence suggests that
patients’ use of both effective and non-effective medicines may
reduce as the level of co-payment rises but there is also evidence to
suggest that providing medicines free of charge may lead to overuse and
waste. A balance needs to be reached, said Mr Björk.
From a societal perspective, pricing policies must ensure patient access
to the most cost-effective therapies available and providers of health
care, such as governments, must be prepared to negotiate reasonable terms
with the pharmaceutical industry to achieve this.
So what should the medicine price reflect? Mr Björk believed that,
in theory, medicines prices should reflect manufacturers’ costs,
ensuring adequate provision for research and development costs and costs
linked to evaluating the safety and effectiveness of medicines.
Prices
should reflect wholesalers’ costs, for example, in storing and
distributing medicines. They should also reflect the costs incurred by
pharmacies, for example, relating to dispensing and providing advice
to patients. In some countries there are also additional imposed costs,
such as taxes, that must be considered.
In practice, however, costs are often set through market dynamics. There
are a number of factors that may influence a manufacturer’s pricing
policy in a particular country, for example, affordability and the local
cost of living. Also, in many countries there is now increasing pressure
on manufacturers to prove the value of their medicines to society.
For
example, manufacturers may be asked to provide evidence of the quality,
safety and cost-effectiveness of their products before they are accepted
for reimbursement by third party payers. There is an emerging consensus
that pharmaceutical pricing regulation is incomplete if no account is
taken of the cost of competing drugs.
On whether medicines pricing is a national issue, Mr Björk said “yes
and no”. It is if consideration is given to affordability in each
country but, in recent years, evidence has shown that the differences
in medicines prices between European countries is declining, with the
industry increasingly considering Europe as one market. If this trend
continues, the future of parallel trade could be limited.
The European Commission has recently established a working group on pricing
policy which reports to the annual EU Pharmaceutical Forum. The aim of
the working group is to share experiences with different pricing and
reimbursement mechanisms and cost-containment strategies and consider
the impact of cross national mechanisms such as parallel trade and reference
pricing.
Participants in this work include ministers from EU member states,
representatives from the European Parliament and representatives from
key stakeholder organisations. The Pharmaceutical Group of the European
Union represents the interests of community pharmacies.
Issues currently
being discussed by the working group relate to finance and affordability,
for example
(i) limiting reimbursement for certain products
(ii) availability,
including the timing of market access and availability in small markets
(iii)
transparency of data such as manufacturers’ prices and trade
(iv)
distribution issues, such as internet sales and counterfeiting
Questioning what the future holds for pricing, Mr Björk said that
there is a need to move to pharmacies being paid directly by third party
payers for services provided and not solely through purchase margins.
He noted and welcomed the move towards this approach in the UK and Sweden.
Comparing health care and drug policies in different countries
of the world
At conferences and in the press, suggestions
are frequently made about health care and drug policies in place
in different countries
but it can be difficult to assess the validity of this information
and, in the event that any details are publicly available, it may
not be up to date, said Jean-Pierre Grégoire, professor of
pharmacy and pharmacoepidemiology at Laval University, Canada. He
described work being undertaken by his university to develop an international
repository of pharmaceutical policies.
It is intended that the repository will provide qualitative summaries
of policies linked to approving the use of medicines, regulating
prices, approving medicines for inclusion in public reimbursement
and optimising the use of medicines. The developers of the online
database intend that all information will be available free of charge.
Information on the handful of countries surveyed to date can be found
online at www.pharmapolicies.net
João Carapinha: policy information being collected |
A similar initiative — an international
survey of drug policy and health care — is currently being
conducted by the FIP Administrative Pharmacy Section. The co-ordinator
of the project, João Carapinha,
of South Africa, provided an overview of the project’s status.
The
survey, which is being supported by the World Health Organization,
aims to provide an overview of the health care systems of countries
through the use of 69 indicators.
To date, information has been collected on 23 countries, with information
ranging from statistics on the size, value and organisation of
a country’s pharmacy market, background information on the
health of the population, for example, life expectancy and mortality
statistics,
and statistics linked to the private and public financing of health
care.
Qualitative information is also being collected to
support the comparison of policies linked to pharmacy regulation,
pharmacy
education, medicine advertising and drug reimbursement.
Initial results show differences in the organisation, structure
and delivery of health care and pharmacy services around the
world. Most
responses that have been received were from high human development
index countries with FIP currently targeting countries in Latin
America, Africa and parts of South East Asia to ensure the results
of the
survey, when complete, can provide a balanced view of health
care and drug policies around the world. |
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The
Pharmaceutical Journal