IMPACT OF CHANGES IN THE METHODOLOGY OF EXTERNAL PRICE REFERENCING ON PRICES
Author(s)
Schneider P, Lepuschütz L, Zimmermann N, Vogler S
Gesundheit Österreich GmbH / Austrian Public Health Institute, Vienna, Austria
Presentation Documents
OBJECTIVES: External price referencing (EPR), by which authorities set medicine prices based on the prices in other countries, is a commonly applied pricing policy in Europe. The study aims to analyse the impact of changes in the EPR methodologies on prices. METHODS: In spring 2015, we surveyed methodological specifications of existing EPR schemes in 31 countries (28 EU Member States, Iceland, Norway, Switzerland) through a questionnaire with competent authorities for pharmaceutical pricing and reimbursement. The gathered information was used to model medicine price developments using discrete-event simulations. Different scenarios (consideration of statutory discounts, regular price revisions, changes in the composition of reference countries, changes in the calculation method, changes in choice of exchange rate, and accounting for the economic situation of the reference countries) were run over a 10 year horizon. RESULTS: Based on actually surveyed EPR specifications, including the frequency of re-evaluations, the erosion of the average price over the years is EUR 78.2 in the 28 EPR applying countries (base case, starting price: EUR 100).When referring to prices taking into account published statutory discounts (existing in Germany, Greece and Ireland), the average medicine prices fall by 27 percent, from EUR 78.1 to EUR 57.15. A decrease of similar magnitude can be observed (average EPR price drops by 25.5%, from 78.2 to EUR 58.2) if all countries use as calculation formula the minimum price. If countries re-evaluate their medicine prices every six months the average price level, it results in drops of the average price of all EPR countries after 10 years of 6 percent, from EUR 78.1 to EUR 73.6. CONCLUSIONS: The simulations illustrate that EPR methodological choices have an impact on national price levels and – as a consequence – on public expenditures.
Conference/Value in Health Info
2016-10, ISPOR Europe 2016, Vienna, Austria
Value in Health, Vol. 19, No. 7 (November 2016)
Code
PHP120
Topic
Economic Evaluation
Topic Subcategory
Cost/Cost of Illness/Resource Use Studies
Disease
Multiple Diseases