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Call for free price-setting across Europe

Published on 29/10/03 at 09:16am

Pharmaceutical companies should be allowed to set their own prices in all the European Union countries in order to bring a single market one step closer, the European Commission has said.

The EU's law makers have tentatively launched the proposal as part of a renewed drive to improve the competitiveness of the European pharmaceutical industry, promoting changes across a broad range of issues.

Erkki Liikanen, the Commissioner for Enterprise and the Information Society has now set out proposals in five key areas. European industry body EFPIA welcomed the proposals and said, if successful, would achieve the following:

-Promote and stimulate centres of R&D excellence along similar lines to the US National Institutes of Health to re-energise European research frameworks

-Improve medicines regulation encouraging more rapid decision-making and efficient procedures and speeding up market access for innovative medicines

-Stimulate innovation by ensuring enforcement of intellectual property standards, including for biotechnological inventions, and by strengthening data exclusivity provisions

-Enable full competition for medicines that are neither purchased nor reimbursed by the State, which should lead to the establishment of a genuine EU wide single market for non-reimbursed medicines;

-Enhance the pharmacovigilance system and provide mechanisms that give patients more access to high quality information on pharmaceuticals from industry as well as from other sources.

The proposals are part of a separate process to ongoing pharmaceutical legislative reform, and form a response to a report by the G10 group. The group is similar to the UK's Pharmaceutical Industry Competitiveness Taskforce (PICTF) and includes representatives from the Commission, the UK government, the industry and generic manufacturers.

The boldest proposals in a wide-ranging report are on pricing and reimbursement.

Research has confirmed that huge variations in how time taken for member states to agree pricing and reimbursement, means patients in some countries are gaining access to medicines far later than patients in other states.

A survey by Cambridge Pharma consultancy found Belgium to be the worst country for decision times, taking on average 761 days to publish its decision on pricing and reimbursement, with Greece, Portugal and France all taking around 400 days.

In contrast, the free pricing system in the UK and Germany mean there was no delays in this regard.

Taking its lead from the UK and Germany, the Commission is now suggesting other countries consider adopting free pricing systems, although it has no authority to force member states to implement its ideas in this area.

Noting that 'more competitive and dynamic mechanisms' for pricing would help create a single market, the Commission suggests: "One option could be based on the principle that manufacturers are given the possibility to set prices of products, while negotiating with the Member States safeguard mechanisms to contain pharmaceutical expenditure, for example, yearly pay-backs or rebates calculated on the revenues generated by these products on the national markets."

The Commission is keen to promote the development of EU-wide methodologies to assess the Added Therapeutic Value (ATV) of a medicine, otherwise known as assessments of its clinical and cost effectiveness.

The plans fall far short of being a blueprint for an EU-wide equivalent of the UK NICE known as the ourth hurdlein the industry, - but signal a desire to standardise practices in this area.

The Commission said: "[Our] objective is to provide a forum for Member States who wish to use relative effectiveness measures, to share ideas on how they may be operated effectively, quickly and placing minimum burden on the parties involved." NICE's chairman Sir Michael Rawlins recently restated his belief that a 'EuroNICE' could never become reality, with variations in health spending and priorities and member state sovereignty providing formidable obstacles.

This view is shared by many senior officials in public health bodies across Europe - France's approach to pricing, reimbursement and clinical and cost effectiveness being most notably at odds to the one now advocated by the Commission.

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