Dr. Alexander Natz, the Secretary General of European Confederation of Pharmaceutical Entrepreneurs (EUCOPE), discusses the need to protect competitive information in the light of the on-going transparency debate, HTA Assessments and protecting rebates in an age of EU price comparison.
Based in Brussels, EUCOPE are an advocacy group representing the interests of mid-size pharmaceutical companies, informing its members on a range of ongoing regulatory, pricing and reimbursement issues with their primary focus being on market access issues across all EU member states. The current climate within Europe of evolving regulatory requirements as payers seek to implement cost-containment strategies has meant that they are constantly informing their members on ongoing shifts in legislative procedures. Where necessary, EUCOPE will also highlight the position and interests of their members at both a national and European level. Dr. Natz makes clear that their, “interaction with payers is always governed by the interests of their whole membership, and great care is taken to never overbalance the interests of one party.” It is as a result of this rigour that they have gained and maintained an effective position with payers and key decision-makers within the European Medicines Agency (EMA) and the EU commission.
Freedom of information vs competitive information
Through their regulatory work, EUCOPE have become actively involved in individual court procedures and also EMA consultation. A major issue for pharmaceutical manufacturers within Europe, which has been garnering a lot media attention recently, is the definition of acceptable limits for data confidentiality. Dr. Natz specifies that the key debate surrounds the limits of what kind of data should be released to stakeholders who are external to the regulatory process, such as patients, competitors or journalists.
This is too far-fetched as a workable transparency policy due to the sheer volume of competitive information which is subsequently revealed
The key issue here for EUCOPE is protecting commercial confidentiality. Current EMA transparency policy stipulates that the full dataset from dossier submissions in the hands of regulatory agencies can be shared publicly. It is the view of Dr. Natz and EUCOPE that this goes too far, and abuses of this policy can significantly harm the commercial interests of pharmaceutical manufacturers. Dr. Natz states “this is too far-fetched as a workable transparency policy due to the sheer volume of competitive information which is subsequently revealed.” Dr. Natz points to a recent case involving Boehringer Ingelheim and one of their member companies, Intermune. Boehringer launched a freedom of information request to EMA for the complete dossier of a recent Intermune submission; an act which seems can only be interpreted as an attempt to secure competitive information. In this case, EUCOPE were able to successfully intervene by representing the interests of Intermune to the European Court of Justice and arguing this case. Dr. Natz states, “the release of the full data set from marketing authorisation to a competitor is simply going too far, this is an important issue as it is a huge amount of clinical data, and this represents the publication of valuable competitive information. We need to act to protect this.”
Health Technology Assessments
EUCOPE work within the pricing and reimbursement sphere is mainly centred on Health Technology Assessments (HTA) decisions, which Dr. Natz highlights as a major issue for pharmaceutical manufacturers who are looking to build a payer strategy for Europe. Succeeding in marketing authorisation is no longer enough to bring a product within Europe. In this era of spiralling health costs and declining tax receipts, negotiations with payers, like the NHS or German payer coalitions, are routine. Manufacturers must therefore make sure they are prepared to approach pricing conversations with the tools to demonstrate cost-effectiveness.
If the manufacturer is not sufficiently prepared to demonstrate the value of their product against therapy alternatives then they run the risk of poor reimbursement
One challenge in building a pan-European strategy for this is the lack of cohesive selection policy for comparator requirements across Europe. There are often complicated variations across different nations and this makes it difficult to meet payer expectations of very specific comparative effectiveness data. The consequence of failing to meet these expectations is that it makes it very hard to get a good price. Dr. Natz says, “If the manufacturer is not sufficiently prepared to demonstrate the value of their product against therapy alternatives then they run the risk of poor reimbursement, and this in turn has its own potential consequences due to the widespread use of reference pricing across Europe.” Pharmaceutical manufacturers must take the time to make sure they understand different payer perspectives on appropriate comparators, or risk paying a heavy cost.
Protect your rebates or lose potential revenue
The publication of commercial information within submitted dossiers has implications for pricing reimbursement as well as intellectual property protection. Dr. Natz points to the particularly troubling situation within Germany where rebates are actually published on the agency website. Due to the prevalent use of reference pricing within Europe, the publication of pricing in one country can have far-reaching repercussions on entire European pricing strategy. European payers will examine publicly available knowledge on rebates before entering into negotiations on pricing and reimbursement and this can put manufacturers in a difficult position. Dr. Natz states that, “this makes it hard to secure differential pricing strategy across Europe. If for example, payers within Greece find out that you have negotiated a rebate within Germany, they will ask for an even bigger discount as a reflection of the larger constraints that they face with regard to their ability to pay.” It is imperative therefore that discounts are kept confidential, otherwise you will immediately export your discount internationally and any payers that you enter into future negotiations with will use this as a starting point to ask for more. It is however entirely legal to negotiate confidentiality on a national level with regards to European law. Dr. Natz recommends that companies can build this into their T&C's during pricing negotiations.
Dr. Natz advises that pharmaceutical manufacturers need to be fully aware as to what tools they have in their toolbox when approaching payer negotiations. Mid-sized pharma companies in particular may not have prior experience of utilising different pricing strategies when dealing with European payers so it is important that they become aware to the options that are available to them.
Questions? Comments? Share your feedback in our comments section below.
You can learn more about how to approach European payer strategy with confidence at the eyeforpharma Payer's forum Europe (21-22 Oct, 2013) This two day conference and forum provides unparalleled engagement opportunities with decision making payers and will explain exactly what payers want to see from your value propositions. Find out more at the official website.
Although future advances in population-wide health may well be driven less by new drugs and devices...
Growth markets aren't the future for big pharma, but they could be for new business models and...
Mobile technology possesses a number of unique attributes to become a powerful behavior change...