The reimbursement of pharmaceuticals in Europe is based on the requirements of the individual member states. After marketing authorization, national HTA bodies evaluate the additional therapeutic benefit of the new pharmaceutical compared with other new or existing treatments.
The reimbursement of pharmaceuticals in Europe is governed by the requirements of the individual member states. For EU member countries, this follows from the fact that social law is not European Union law, but rather lies within the competence of the respective individual states. Therefore, it is not uncommon for a drug that has central approval by the EMA to be prescribed to widely varying degrees within the individual EU countries. For non-innovative medicines for which patent protection has expired and which are offered by different pharmaceutical companies, the variations are not as pronounced, although they do exist.
Following market authorization, national HTA bodies evaluate the additional therapeutic benefit offered by innovative drugs relative to other new or existing treatments. This additional benefit is re-evaluated at regular intervals with respect to what is considered the established gold-standard treatment at the time. Broadly speaking, the assessment is geared towards establishing whether a new drug is better than the established standard treatment with respect to efficacy and safety. Establishing this additional therapeutic benefit is not always clear-cut, for example if the new drug shows improved efficacy but also a worse safety profile. Furthermore, in most European countries, HTA bodies do not have the authority to make reimbursement decisions by themselves. These decisions are normally based on HTA bodies’ assessments but taken by other public sector organizations which are often under direct state control. A positive assessment by national HTA bodies is usually a prerequisite for ensuring adequate reimbursement from the point of view of the pharmaceutical manufacturer. A negative assessment in turn implies no reimbursement or reimbursement at the level of the established standard treatment.
Reimbursement Planning and the Approval Process
As a result, a company intending to market an innovative medicinal product in Europe must apply for example for an EMA marketing authorization and, at the same time, deal with the reimbursement rules of the individual EU Member States. For some types of drugs, there is still the possibility to apply for market authorization through the national licensing authorities. EMA assesses efficacy and safety. This does not imply any automatic decision regarding reimbursement though. Early consideration of reimbursement requirements is crucial in ensuring that ideally the drug will be included in the reimbursement catalog of national healthcare systems immediately once marketing authorization has been granted. Ideally, national reimbursement requirements are already taken into account during the planning of the pivotal studies.
In Germany, for example, progression-free survival is not recognized as a relevant endpoint in the context of assessing additional therapeutic benefit. This illustrates that it is crucial to consider national HTA agencies requirements regarding reimbursement when designing the clinical development programme for a new drug, especially phase III studies. Not including those endpoints in trial planning which are considered of primary importance by the respective national HTA agencies may lead to a drug not being granted an additional therapeutic benefit even though this may well have been granted had trials been designed differently.
Strategies for Reimbursement and Pricing
Hence, HTA agencies’ requirements regarding reimbursement should already be taken into account when planning pivotal trials. Any European market access- and reimbursement strategy must take into account the requirements of the major European countries, primarily Germany, France and the United Kingdom, as well as Spain and Italy. However, the latter two countries have a reimbursement process that is strongly influenced by regional factors. Following the UK's exit from the EU, the Netherlands is becoming increasingly important because the European Medicines Agency (EMA) has been relocated to Amsterdam and because the Dutch HTA agency, called Zorginstituut Nederland - ZIN has an important role within the EU, as well as Europe as a whole.
There is also the possibility to discuss the endpoints of a planned clinical trial with relevance to licensing as well as reimbursement authorities in parallel with EMA and HTA agencies. It should be noted, however, that this early dialogue is not legally binding. Being aware of the evidence requirements for licensing, as well as pricing and reimbursement authorities is a necessary precondition to ensure that a new drug can be reimbursed, as well as prescribed in any specific country as soon as possible after receiving market authorization.
Reimbursement and Pricing of Innovative Drugs
As described, innovative drugs first go through the HTA procedure of the respective European country, followed by price negotiations. National price negotiations can take place centrally or at the regional level. Some European countries have various public health insurance funds that negotiate prices for the part of the population covered by them. Prices can further be negotiated publicly or non-publicly. Many EU member countries, as well as Switzerland, have published prices (also called list prices). However, in reality, rebates on these list prices may be negotiated routinely between pharmaceutical companies and health insurers. Therefore, the exact price of a drug is known only to the manufacturer and the payer, but not to patients or competing drug companies. However, the list price can be considered as an upper price limit. As a price referencing system exists between European countries, list prices are important, as referencing is based on them as long as no other reliable source for a (lower) price can be used.