Risk Sharing: The Need to Think Differently

Dear All,

Olivier's and my article on risk sharing is finally published in this months edition of ISPOR Connections. For the full article with figures & tables click here.

Risk-sharing: The Need to Think Differently

Olivier Ethgen, MSc, PhD, Associate Professor, Department of Public Health Sciences, University of Liège, Liège, Belgium, and Senior Manager, Global Health Economics, GlaxoSmithKline Biologicals, Wavre, Belgium; and Ulf Staginnus, MA, Head, Pricing & Health Economics Europe, Novartis Oncology, Barcelona, Spain

Under continuing economic pressure, the assessment of new therapy now goes well beyond the three ex-ante regulatory hurdles (quality, safety and efficacy). The last several years have witnessed the emergence of payers and health technology assessment (HTA) agencies as key stakeholders in market access negotiations. In this context, cost-effectiveness analysis has been given a central role and is now likely the most searched and applied type of analysis.

Cost-effectiveness models are principally based on ex-ante and relatively scattered information. Models are built upon the combination of Phase III data, observational data and reviews, should they be systematic or not. Results are more than often positively reported and support the claim that the new technology is cost-effective at the prevailing threshold.

Real World
Considerable uncertainties remain in post real-world cost and effectiveness outcomes i.e., in the non-investigational, local and practical setting in which the product is effectively given. It is precisely in that setting that the real costs for the health care system are incurred. Those uncertainties are thus worrying for the payers, regardless of how well uncertainty has been factored in the ex-ante cost-effectiveness exercise. Payers increasingly require alignment of their payments with the real-world achievements of new products. Meanwhile, spurring innovation and providing access to innovative treatment for deserving patients remain a priority for any health care system.

Reference Pricing
From a pricing perspective, international price referencing (IPR) is increasingly used by many countries as a cost containment measure, notably in Europe. A specific country gathers and compares the prices from other countries and according to certain formulas (such as the average, the lowest, etc.) sets its price level. As a result, price modifications in one or more external markets have immediate implications on the price levels in other markets. This may trigger a spiral of cross-referencing and price adjustment, which usually results in a downward pricing spiral.

In this context of increasing ex-post value appreciation and price referencing system, there is now a call for new market access solution. This is where risk-sharing mechanisms or the so-called innovative pricing or market access agreement approaches come into play. Those new type of agreement are precisely a mean of ensuring access to innovation, while at the same time mitigating payers’ ex-post financial exposure and providing fair return on investment for manufacturer.

Practical Approach
A risk-sharing type of agreement basically consists in the form of contractual agreement between a payer and a manufacturer. The purpose is to share the whole or a part of the financial risk associated with the use of a new therapy in real-world or non-investigational conditions. The agreement is primarily set to advance patient’s access to the new therapy when the payer deems its ex-post financial risk exposure too high and consequently challenges the demanded price and/or reimbursement conditions.

A key feature of a risk-sharing approach lies in its practicality and expediency. These agreements are very flexible by nature and can take a myriad of forms, (from financial-based to performance-based type of agreement) and can be applied at different levels (at the population level or at the individual patient level). The refunding can also function according to different mechanisms, from price adjustment to rebate or to the funding of further evidence development.

A risk-sharing type of agreement might be expected to multiply over the forthcoming years in a market access environment where claiming cost-effectiveness on ex-ante data and sometimes complex models, seem less and less compelling in the eyes of payers. In addition, the flexibility given by risk-sharing can allow the manufacturer to optimally deploy its launch and pricing strategy under the budgetary constraints and the price referencing system increasingly imposed by payers. For instance, a manufacturer that is carrying out a new launch sequence in Europe may strategically secure a “high” visible price in a specific country while operating in the meantime a “rebate back” via a risk-sharing scheme to allow the new compound to meet the prevailing cost-per-QALY threshold in that country.

Uncertainty versus Risk
The risk-sharing approach calls for a fundamental difference between the concept of uncertainty and the concept of risk. Too often, risk and uncertainty are considered as similar construct and used interchangeably. In health economics models, we mostly focus our effort on the analysis of uncertainty in the cost-effectiveness ratio.

Uncertainty and risk, however, are different concepts, related concepts but different. Uncertainty is by essence a common feature of the universe and relates to variables (should they be qualitative, quantitative or behavioural) that are unknown and changing over time. On the other hand, risk is a matter of exposure to uncertainty, notably to the adverse realization of uncertainty.

In others words, uncertainty in the ex-post outcomes of a new intervention can be the same for both the payer and the manufacturer, but the risk of paying for disappointing ex-post outcomes (the adverse realization of uncertainty in the outcomes) is borne by the payer only. Payers are thus the one to be exposed to the financial risk of introducing a new intervention in real-world conditions, should adverse uncertainty be realized. They bear the financial consequences of the adverse realization of uncertainties. The purpose of a risk-sharing agreement is precisely to shift part of the financial risk from the payer to the manufacturer as a mean to hasten market access.

New Type of Model
The distinction between uncertainty and risk is fundamental. During the negotiation phase, modeling the financial implications (the financial risk!) of uncertainty in the real-world setting can be helpful. From a modeling standpoint, uncertainty is as we know accounted in through probabilistic sensitivity analysis. A financial risk analysis, however, necessitates further work. The basic principle is to combine the evolution of uncertainty over time with the related consequences of the adverse realization of uncertainty.

The size of the target population and its evolution, the market dynamics (the adoption and the diffusion of the new compound in clinical practice) and the implementation costs are just as many additional features that need to be accounted for. As compared to cost-effectiveness models, the modeling of a potential risk-sharing agreement is at the interplay of 3 dynamics. Cost-effectiveness deals with clinical dynamics and pathways, through cohort-based types of models that reflect individual-based clinical decisions and outcomes. Risk-sharing scheme simulations need the additional consideration of both the target population and the market dynamics (Fig. 1). Practically, a risk-sharing model intended to aid both parties in negotiating a scheme would need the 3 components (Fig. 2):

Defining — both parties need to define the uncertainty at stake, the adjacent risk and the potential scheme terms and conditions, i.e. the risk-sharing equation;
Forecasting — the evolution of uncertainty and the consequent risk over time need to be forecasted. This can be done through multiple scenario analysis with different population, clinical and market dynamics; and
Sharing — the financial risk to be shared can be simulated through the application of the risk-sharing equation defined earlier to the results of the forecasting exercise.


This is a back and forth process. The results of the third “sharing” step can lead the parties to redefine the risk at stake and the sharing equation, and so on. In addition, the schemes implementation and administration costs (fixed and variable as per the number of patients enrolled) need to be accounted for in the modeling endeavour.

All these practical things and resulting impacts on both the payer budget and the manufacturer return are simply not possible within the cost-effectiveness analytical framework. Therefore, when contemplating a risk-sharing agreement, it is important to bear in mind that there is a need to think about new type of models and not only about cost-effectiveness cohort-based models. Table 1 stylizes the opposition between risk-sharing modeling and the current cost-effectiveness modeling approach where much of our decision-making modeling efforts is devoted to the ex-ante appraisal of the iCER only.

To Share or Not to Share?
A risk-sharing model can help both the payer and the manufacturer to address a fundamental question: should we share or not; and if yes, under which set of optimal conditions for both parties? Admittedly, payers and manufacturers have the choice among multiple strategies during the market access negotiation. For instance, to mitigate its financial ex-post exposure, a payer can deny to cover the new compound, can slash the price or the reimbursement rate, can restrict the indication or the reimbursement criteria, can ask for patients’ copayment, etc. In most instances, payers have legally the discretionary power to do so. On the other side, if the manufacturer challenges the payer decision, the manufacturer can sponsor the development of further evidence at the cost of delaying its access to market or can propose a risk-sharing type of agreement to enter the market earlier.



The outputs of a model that depicts the financial implications of a risk-sharing schemes can be imported into a cost-benefit analysis (from a payer perspective) or a capital budgeting analysis (from a manufacturer perspective) to help both the payer and the manufacturer to find and propose an optimal win-win solution to each other.

Conditions for Success
Last but not least administration cost and logistics need to be minimized in order not to overburden the scheme. IT improvements both on payer and industry side and new technologies for patient tracking and data reporting will improve the transaction cost of these schemes over time. It is through practical risk-sharing models and micro-costing pilot studies that these costs can be accounted for in the overall evaluation of the proposed schemes.

Willingness to explore new ways of engagement between payers and manufac-turers as well as a de-regulation of IPR and other legal obstacles to risk-sharing are important prerequisites for success. Risk-sharing and innovative pricing should not become an additional hurdle for market access. In such a system there is no place nor need for cross-border price referencing as the bilateral risk sharing agreement is exactly designed to create the individual win-win solution that is desired.

Perspectives
The current market access context is encouraging recourse to a new type of agreement and negotiation base. Payers increasingly emphasize the importance of the real-world value delivered by new products. In the meantime, they also seem willing to negotiate alternative approaches with the objective to mitigate as much as possible their ex-post financial risk exposure. Therefore, manufac-turers face harder access hurdles but also more flexible negotiation conditions that leave room for innovative access and pricing strategies. Risk-sharing agreements represent an opportunity to link volume, quality and payment in delivering innovative health care solution to patients within increasingly budgetary constrained health care systems. In addition to cost-effectiveness, some new and practical form of modeling can be used to help in the design of efficient schemes, benefiting all parties at stake: the patient, the clinicians, the payer and the manufacturer. In all instances, the proposed scheme implemen-tation and administration costs are to be factored into the model. Considering the current health care environment and macroeconomic conditions, risk sharing and alternative pricing are important opportunities to take differences in relative wealth between countries into account and to overcome access barriers thereby improving and speeding up patients’ access to innovative medicines

Spain: Payment by results on the horizon

Dear all,

According to El Pais, the autonomous Spanish community of Cataluña has indicated that it would like to move towards performance based for hospital drugs similar to the Italian risk sharing model. The idea is that prices for hospital drugs, especially in the oncology area, are fixed at the central minsitry of health level but than the autonomous community negotiate with the manufacturers according to outcomes based risk sharing models. The responsible for pharmaceuticals in the Catalan NHS sees this as a way of getting novel medicines to the patients while at the same time maintaining the sustainability of the system. Accoding to the article the program is going to be initiated in one hospital in Barcelona and aparently an agreement with one manufacturer has almost been finalized. It remains to be seen how the ministry of health is reacting to this initiative.

Cheers
Ulf

Compensation survey Health Economics, Pricing and Market Access

Dear Readers,

after the many questions I received around compensation in our field I finally decided to put a short survey together (only 8 questions).

This is going to be the first of its kind and I am sure it will become a very valuable source of information, which of course I will share with you. All of this is obviously very anonymous as I do not ask any private nor personal information. Please share the link among your friends and colleagues so that we get a large and representive sample.

Click here to take survey

Many thanks for your kind contibution!
Cheers Ulf

European Pharma industry association (EFPIA) welcomes report on reference pricing

from SCRIP intelligence

Reference pricing in EU leads to convergence and
lower prices, says Strasbourg report
27 April 2011
Elizabeth Sukkar

According to a new independent report commissioned by the European Parliament, European Union countries' use of reference pricing to control drug prices seems to be leading to price convergence for some drugs and, in general, to lower prices.
The report was commissioned by the European Parliament's influential environment, public health and food safety (ENVI) committee, to gain a better understanding of why drug prices and public pharma expenditures vary across EU countries. It says that "Despite the significant price differentials [across the EU], there appears to be some price convergence for in-patent pharmaceuticals across EU countries, as price differences across member states have been decreasing. This is likely to be due to the mechanism of external price referencing, which has become the most common price setting measure for in-patent pharmaceuticals in EU member states."
The report points out that reference pricing can lead to "lower" pharmaceutical prices, in particular when a member state uses lowest comparison prices than an average, or when currencies fluctuate. There are also significant market skewing impacts of reference pricing that may lead to uncertainties in the industrial investment climate, the over-riding of national health priorities, and disincentives for new product launches, the report says.
The European pharmaceutical industry association, EFPIA, has broadly welcomed the report as it highlights what it has long identified as problems with reference pricing. The association told Scrip that it will use the report to raise awareness about the "detrimental effects" of price referencing. The report will also no doubt help the industry build a case for the introduction of better methodology for countries applying reference pricing schemes. The report will help the parliament formulate its view when it provides feedback in May into the European Commission's planned modernisation of the 23-year old Transparency Directive (89/105/EEC) on drug pricing and reimbursement in the EU.
The European Commission has made it abundantly clear that it has no remit to unify drug pricing. As Antonio Tajani, the European Commission's vice president responsible for industry and entrepreneurship, stressed at a recent conference, "there is no room for harmonising pricing and reimbursement systems in Europe and the Commission cannot interfere with the substance of those national decisions" (scripintelligence.com, 1 April 2011). However, it hopes
that transparency mechanisms might help the EU member states avoid duplicative efforts. Reference pricing is used by the bulk of EU member states, that is 24 out of 27, with the exception of the UK, Germany and Sweden. Reference pricing occurs when a country bases its drug prices on those in other member states – the number of countries used in the basket can range from as little as three (eg, Slovenia) to as many as 26 (eg, Latvia). Each country may also define its own group of reference states and its own price selection criteria (the mean of all EU states; the mean selected countries; the lowest price of any country; an mean price minus a
further discount; the median price). The result can be a self-referencing spiral, usually a downward one.

Dangers of reference pricing
From a pharmaceutical company point of view, but not necessarily that of a government payor, the fact that reference pricing can lead to "lower" pharmaceutical prices is a danger. But the report raises are other concerns that result from an unthinking use of the tool. The report says: "Although external price referencing can help cost-containment by reducing prices, there are concerns arising from the fact that it is an arbitrary measure targeting prices
that ignores other aspects of the market, the particular health priorities in each country and creates uncertainty for the innovative segments of the industry, especially due to the impact of exchange rate fluctuations on reference prices." The report notes that exchange rate fluctuations put further downward pressure on prices, rather than having a "neutral effect".
Significantly for patients one of the "unintended consequences" of reference pricing is that pharma companies are more likely to avoid launching a product in a country if that country's price is low and influences third countries. Reference pricing, in essence, causes an echo in prices elsewhere, and the decision that a company may make with respect to an individual country launch may be influenced by the trans-European impact on price (and profit). This was seen last year during Greece's drug pricing crisis when insulin manufacturers threatened to withdraw their products.

Policy options
Although the EU must respect the "subsidiarity" of pricing and reimbursement – that these are decisions taken at the national level in Europe - the report has few qualms about making recommendations. Specifically, it recommends that countries should consider changing the composition of their referencing "baskets" to reduce the impact of exchange rate fluctuations: countries who do not use the Euro, for instance, should not be included by countries who do. It also suggest that reference pricing should use the average price of all countries in the basket,rather than lowest or average of lowest few. The report also says that there should be further study of reference pricing’s impact on launch delays, with a view to developing policies to discourage such practices.

Join the Health Economics and Pharmacotherapy Delegation to China

Join us this August in China to learn about health economics and pharmacotherapy with our international colleagues. Visit www.peopletopeople.com/holtorf for complete program details.

It is my privilege to have been selected as a delegation leader for People to People Citizen Ambassador Programs in August of 2011. This organization has created an exchange to foster international goodwill, professional development and personal enrichment.

Please consider joining the Health Economics and Pharmacotherapy Delegation to China, where you can learn about the role of health economics and pharmacotherapy within Chinese healthcare. Our mission is to bridge cultural and political borders through education and exchange with our Chinese counterparts. The delegation will arrive to meet international colleagues in China on August 20, and together, we will have the honor of experiencing the rich culture of Beijing and Shanghai. We will arrive back home on August 29.

Visit www.peopletopeople.com/holtorf for additional information—program costs, inclusions, a complete itinerary, and enrollment details.

Hoping to meet you there,

Anke-Peggy Holtorf, PhD, MBA

Managing Director of Health Outcomes Strategies, GmbH, Basel, Switzerland (www.health-os.com) and

Adjunct Faculty at the University of Utah, Pharmacotherapy Outcomes Research Center

3rd Annual Payer Experiences with Risk-Sharing & Value-Based Pricing & Reimbursement Schemes

Understanding how payers evaluate, decide on, Implement and measure innovative reimbursement agreements

Conference Dates: June 16-17th, 2011
Venue: Berlin, Germany

NextLevel Pharma was the first company to organise a specific risk-sharing event in 2009, but this 3rd annual event will now, for the first time be focused on the experiences and perspectives of payers and HTAs who have direct experience with managing conditional reimbursement agreements. Now will be the perfect opportunity to find out if such schemes are here to stay and if yes, how they will look in the future.

Why Attend?
• View innovative reimbursement agreements through the eyes of payers and understand their evaluation process for different schemes.
• Find out when risk-sharing & value-based agreements are required and how they can be designed to satisfy all stakeholders to gain patient access.
• Obtain the latest information on value-based pricing initiatives and implementation.
• Learn what data requirements payers have for each model.
• Discover how innovative agreements affect product profitability in the medium and long-terms.
• Learn how cost-effectiveness is being demonstrated in different regions under innovative agreements.
• Work out what are the risks of innovative schemes and if they are worth the administrative burden and effort.
• Hear the perspectives of all stakeholder groups: Payers, regulators, insurers, health economists and the pharmaceutical industry.
• Discover how payers are thinking today and what is the European and Global trend towards innovative reimbursement contracts.


Who will benefit?
Pharmaceutical companies:
Vice-Presidents, Directors, Managers involved in: Pricing & Reimbursement, Market-Access, Health Economics & Outcomes, Government & Stakeholder Relations, Regulatory Affairs, Medical Affairs, Marketing & Commercial, Therapy Area Heads, Country Managers, Business Unit Heads.

Solution providers & consultants:
CEOs, Business Development, Senior Consultants, Regional Heads.

Plus:
Independent Academics, Health Economists, Economists, Government Officials, Public & Private Healthcare Providers, Senior Doctors & Patient Representatives

Agenda request
To request the full agenda please follow the link:
http://www.nextlevelpharma.com/events/request_agenda/3rd_annual_payer_experiences_with_risk_sharing_value_based_pricing_reimbursement_schemes

For Booking Information contact:
Erika Vavrovicova

Tel: +421 232 660 382
Fax: +421 233 010 331
Email: erika@nextlevelpharma.com
Visit: www.nextlevelpharma.com

Pharma 3.0

Dear All,

after a heavy week of traveling I had the chance to check out the new Pharma 3.0 report from Ernst & Young. It is a very interesting report. Refreshing to see that E&Y have put together what the future should bring - focus on patients and outcomes. Increased technology and IT capabilities as well as data mining from broad sources are being discussed. This indeed is a cornerstone of moving the industry forward. In that area we are still a somewhat old fashioned industry that needs to learn from technology companies in order to move the IT and data collection capabilities to the next level. That requires however not only technical know how but foremost the right mindset and culture... mant times colleagues and friends in the industry complain that they hardly can install the weather application on their blackberry without having gone through a large approval procedure. That way of course pharma 3.0 will not work... ;)
What is great about this report is that it really tackles what I consider the main problem, the lack of being easily able to collect real life data to demonstrate the outcomes in the "garden variety" patient and over time. New technologies should enable us to track, analyze and send data in real time via apps etc and alter individual treatment decisions based on the learnings. If that is coupled with patient self diagnosis on certain parameters or biomarkers that will provide a true patient perspective that we have never experienced before.
Cheers
Ulf

European Cost-Containment Measures and Effects on Healthcare

Dear Readers,

I have recently been interviewed by Jeff Waite from Stelerix on European cost containment. I would like to share the link to our discussion.

Regards
Ulf

A new Value Based Pricing research paper from York

Dear Readers,

a colleague of mine just pointed out a new paper on value based pricing from the University of York. The NHS consultation period is ongoing and am sure we will see a lot more papers and discussion on the topic. Stay tuned!
Ciao
Ulf

New Chapter of the Procedural Rules of the Federal Joint Committee translation provided by vfa

Chapter 1: Area of application and definition of terms

§ 1 Area of application
(1) On the basis of the Regulation for Pharmaceutical Benefit Assessments this chapter regulates the procedure of the benefit assessment of pharmaceuticals with new active ingredients eligible for reimbursement pursuant to Section 35a para. 1 and para. 6 of the German Social Code Book V, especially the advice, the requirements for required evidence (dossier) for proof of benefit, the procedure for the hearings and the implementation of the benefit assessment into the Pharmaceutical Guideline.
(2) The benefit assessment pursuant to Section 35a para. 1 and para. 6 of the of the German Social Code Book V is conducted for pharmaceuticals with new active ingredients or combinations of new active ingredients that are eligible for reimbursement,
1. Which are first launched after January 1, 2011, if this is the first time that a pharmaceutical with this new active ingredient is launched;
2. Which were first launched after January 1, 2011, and receive a new therapeutic indication pursuant to Section 2 para. 2 after January 1, 2011;
3. If the Federal Joint Committee prompts a benefit assessment pursuant to Section 16;
4. If the Federal Joint Committee prompts a benefit assessment due to new scientific findings pursuant to Section 13;
5. upon application by the pharmaceutical entrepreneur pursuant to Section 14;
6. For which the Federal Joint Committee has decided upon a benefit assessment with a time limit, as soon as this time limit has expired.
7. Which were launched prior to January 1, 2011, and receive a new therapeutic indication pursuant to Section 2 para. 2 after January 1, 2011, if the Federal Joint Committee has already prompted a benefit assessment pursuant to Section 16;
(3) The provisions of chapter 4 of the Procedural Rules are not affected by these provisions.
§ 2 Pharmaceuticals with new active ingredients
(1) Pharmaceuticals with new active ingredients are medicinal products that contain active ingredients whose effects are not commonly known in medical science at the time of first marketing authorization. A pharmaceutical with a new active ingredient shall be considered a pharmaceutical with a new active ingredient for as long as there is data exclusivity for the drug with this active ingredient that received marketing authorization for the first time. Fixed combinations of active ingredients that contain
at least one new active ingredient, shall be deemed to be pharmaceuticals in terms of clause 1.
(2) A new therapeutic indication is a therapeutic indication for which a new marketing authorization is granted pursuant to Section 29 para. 3 no 3 of the German Medicinal Products Act or which is classified as a major variation of type II according to Annex II No 2 Letter (a) of Commission Regulation (EC) No 1234/2008 of November 24, 2008, concerning the examination of variations to the terms of marketing authorizations for pharmaceuticals for human use and veterinary pharmaceuticals (Official Journal of the European Union L 334 of December 12, 2008, p. 7). A therapeutic indication ist new compared to the already authorized one of a pharmaceutical especially in those cases where
 The claimed indication of the therapeutic indication is for a group of patients differing from the already authorized therapeutic indications
 An indication is added which is belonging to another therapeutic area (treatment, diagnosis or prophylaxis), or
 The indication is transferred into another therapeutic area (treatment, diagnosis, prophylaxis).
§ 3 Benefit and additional benefit
(1) The benefit of a pharmaceutical is the patient-relevant, therapeutic effect, particularly with regard to an improvement in the state of health, the shortening of the duration of illness, the extension of survival, the reduction of side effects or an improvement in the quality of life.
(2) The additional benefit of a pharmaceutical is a benefit in terms of paragraph 1 that is quantitatively or qualitatively greater than the benefit provided by the appropriate comparative therapy.
§ 4 Responsibility for the conduct of the benefit assessment
(1) The subcommittee Pharmaceuticals shall be responsible for the conduct of the assessment procedure. The subcommitee shall set up working groups which can be commissioned particularly with the following tasks:
1. Preparation of the advice
2. Drafting of a benefit assessment except in cases where Section 17 requires another procedure
3. Appraisal of comments
4. Preparation of decisions.
(2) The conduct of the benefit assessment will be comprehensively documented. The comprehensive documentation shall contain:
1. Description of the course of the procedure
2. Basic benefit assessment and dossier
3. Comments received from the written and oral hearings
4. Appraisal of the arguments raised
5. Assessment of the additional benefit by the Federal Joint Committee.
(3) The subcommittee shall hold discussions on the basis of the report of the working group and shall submit the results of its assessment and a draft decision to the plenary.

Chapter 2: Proof of additional benefit and definition of the comparative therapy

§ 5 Requirements regarding the proof of the additional benefit by the pharmaceutical entrepreneur
(1) The additional benefit must be proven by the pharmaceutical entrepreneur in the dossier pursuant to Section 9. The Federal Joint Committee is under no obligation to officially investigate.
(2) For pharmaceuticals with new active ingredients that are eligible for reimbursement and are pharmacologically-therapeutically comparable to reference price drugs, the additional medical benefit must be proven as a therapeutic improvement in accordance with Section 35 para. 1b clause 1 to 5 of the of the German Social Code Book V. Proof of a therapeutic improvement is rendered based on the summary of product characteristics and based on an assessment of clinical trials according to the international standards of evidence-based medicine. Priority consideration must be given to clinical studies, especially direct comparative studies with other pharmaceuticals of this reference price group with patient-relevant endpoints, especially mortality, morbidity and quality of life.
(3) For pharmaceuticals with new active ingredients that do not meet the requirements in paragraph 2, an additional benefit is proven for the respective approved therapeutic indication compared to the appropriate comparative therapy determined according to Section 6 based on materials about the benefit of the pharmaceutical in the approved therapeutic indications in accordance with Section 6. The pharmaceutical marketing authorization, the product information approved by the authorities, notices from the regulatory agencies, and the assessment of clinical trials according to the international standards of evidence-based medicine represent the basis for this. In case that it is not possible or not appropriate to conduct or to request studies of the highest level of evidence the pharmaceutical entrepreneur shall submit evidence of the best available level of evidence together with a special
justification. In addition the pharmaceutical entrepreneur shall demonstrate to what extent the evidence submitted by him as the best available evidence is appropriate for proof of an additional benefit. The recognition of the additional benefit on the basis of materials of a lower level of evidence will require a grade of justification proportional to the deviation of level of evidence I.
(4) The probability and extent of an additional benefit must be presented in the dossier. In doing so, the informative value of the evidence must be indicated. Regarding the probability the extent of certainty regarding the statement on the existence of an additional benefit (certainty of results) has to be explained. The information regarding the informative value of results shall be presented in reference to the number of patients and to the magnitude of the additional benefit as well.
(5) For pharmaceuticals according to paragraph 3, the additional benefit compared to the appropriate comparative therapy is determined as an improvement in influencing patient-relevant endpoints to produce a benefit pursuant to Section 3 para. 1. For proof of the additional benefit randomized, blinded and controlled direct comparative studies shall be preferably considered the methodology of which a corresponding are corresponding to the international standards and to the evidence-based medicine. These studies should have been conducted with populations or under conditions which are representative and relevant for the usual treatment situation and in comparison to an appropriate comparative therapy according to Section 6. If no direct comparative studies for the new pharmaceutical and the appropriate comparative therapy are available or said studies do not allow sufficient conclusions regarding an additional benefit, available clinical studies for the appropriate comparative therapy can be consulted, preferably randomized, blinded and controlled studies, if they are appropriate for an indirect comparison to the new pharmaceutical with the new active ingredients and thus are appropriate for the proof of the additional benefit by indirect comparison. If it is not possible that valid data on patient-relevant endpoints are available at the time of evaluation, the assessment is made based on the best available evidence in consideration of the study quality and the probability of a proven additional benefit is indicated.
(6) The informative value of the evidence must be presented in consideration of the study quality, the validity of the chosen endpoints and the level of evidence, and it must be assessed with what probability and to what extent an additional benefit exists; para. 4 clause 1 part 2 applies accordingly. The submitted studies are assessed with regard to their planning, implementation and evaluation quality in terms of their informative value for the relevance of the additional benefit. In the dossier, it must be shown for all submitted materials at which level of evidence proof is rendered. The following levels of evidence apply:
1. I a Systematic reviews of studies of evidence level Ib
2. I b Randomized controlled trials
3. II a Systematic reviews of evidence level IIb
4. II b Prospective comparative cohort studies
5. III Retrospective comparative studies
6. IV Case-series studies and other non-comparative studies
7. V Associative observations, pathophysiological considerations, descriptive presentations, individual case reports, opinions of acknowledged experts not backed up by studies, consensus conferences and reports of expert committees.
(7) For pharmaceuticals in accordance with paragraph 3, the extent and therapeutic significance of the additional benefit must be quantified as follows in consideration of the severity of the disease compared to the benefit of the appropriate comparative therapy:
1. A major additional benefit exists, if a lasting major improvement of the therapy-relevant benefit is achieved in terms of Section 2 para. 3 that was previously not attained compared to the appropriate comparative therapy, especially recovery from the disease, a significant extension in the duration of survival, long-term freedom from severe symptoms or extensive avoidance of serious side effects according to Section 4 para. 13 of the Medicinal Products Act and Chapter 4 Section 23 para. 1 of the Procedural Rules of the Federal Joint Committee;
2. An important additional benefit exists, if a significant improvement of the therapy-relevant benefit is achieved in terms of Section 3 para. 1 that was previously not attained compared to the appropriate comparative therapy, especially a reduction of serious symptoms, a moderate extension of the duration of life, an alleviation of the disease that is noticeable for the patients, a relevant avoidance of serious side effects, or a significant avoidance of other side effects;
3. A slight additional benefit exists, if a moderate and not just minor improvement of the therapy-relevant benefit is achieved in terms of Section 3 para. 1 that was previously not attained compared to the appropriate comparative therapy, especially a reduction of non-serious symptoms of the disease or a relevant avoidance of side effects;
4. An additional benefit exists but is not quantifiable, because the scientific data basis does not allow such quantification;
5. No additional benefit has been proven;
6. The benefit of the pharmaceutical to be assessed is smaller than the benefit of the appropriate comparative therapy.
§ 6 Appropriate comparative therapy
(1) An appropriate comparative therapy is the therapy whose benefit is compared to the benefit of a pharmaceutical with new active ingredients for the benefit assessment in accordance with Section 35a of the of the German Social Code Book V.
(2) The appropriate comparative therapy must regularly be determined according to benchmarks resulting from the international standards of evidence-based medicine. Among several alternatives, the more economical therapy must be chosen, preferably a therapy that is subject to a reference price.
(3) The appropriate comparative therapy must be a suitable therapy in the given therapeutic indication according to the generally acknowledged state of medical knowledge (Section 12 of the of the German Social Code Book V), preferably a therapy for which there are endpoint studies and which is tried and tested in practical application, unless it is opposed by guidelines according to Section 92 para. 1 of the of the German Social Code Book V or the dictate of economic efficiency. For the determination of the appropriate comparative therapy especially the following criteria shall be considered:
1. In cases where the application of a pharmaceutical is eligible as a comparative therapy as a rule the pharmaceutical must be authorized for the therapeutic indication.
2. In cases where a non-pharmaceutical treatment is eligible as a comparative therapy this treatment must be suitable to be applied within the framework of the statutory health insurance.
3. As comparative therapies those applications of pharmaceuticals or non-pharmaceutical treatments should be chosen whose patient-relevant benefit has already been confirmed by the Federal Joint Committee.
4. The comparative therapy shall be part of the appropriate therapy in the therapeutic area according to the generally acknowledged state of medical knowledge.
5. In case of several alternative therapies the more economic one should be chosen, preferably a therapy for which a reference price has been set.
(4) For pharmaceuticals of a single substance category, in consideration of para. 3 the same appropriate comparative therapy must be used in order to ensure a uniform assessment. The appropriate comparative therapy must also be suitable for assessments of pharmaceuticals launched prior to January 1, 2011, prompted by the Federal Joint Committee pursuant to Section 35a para. 6 of the of the German Social Code Book V.
§ 7 Advice
(1) The Federal Joint Committee advises the pharmaceutical entrepreneur upon his written request based on the submitted materials in accordance with clause 6l. The object of the advice includes especially the information and studies to be submitted as well as the appropriate comparative therapy. Advice on the content of finalised procedures as well as on active legal procedures is in principle excluded. There will be no validation of data with regard to the future submission of the dossier. For the
request of an advice the form according to annex I (request form) shall be used. In the request form (annex I) the questions to be discussed during the advice shall be submitted in German. The pharmaceutical entrepreneur shall submit to the Federal Joint Committee the materials and information that are significant for the compilation of the dossier for the benefit assessment and that are available at that point in time in German or in English. The consultation is conducted within eight weeks after submission of the materials. If the pharmaceutical entrepreneur does not submit the materials needed for the advice the Federal Joint Committee may refrain from an advice. The advice is performed by the office of the Federal Joint Committee unless a different decision is made. The advice may take place before the start of the phase III studies and with the participation of the Federal Institute for Drugs and Medical Devices or the Paul Ehrlich Institute.
(2) The information sent as part of the advice must be treated confidentially. The pharmaceutical entrepreneur will receive a transcript of the advice. The Federal Joint Committee can conclude agreements with the pharmaceutical entrepreneur in this respect. The information given by the Federal Joint Committee during an advice on topics according to para. 1 clause 1 is non-binding.
(3) For benefit assessments pursuant to Section 16, an advice must be offered before the Federal Joint Committee requests the pharmaceutical entrepreneur to submit a dossier. The advice will be given in German.
(4) For the advice fees will be collected. Details on the amount of the fees are set in the fee regulation.

Chapter 3: Assessment procedure

§ 8 Start of the assessment procedure
The assessment procedure at the Federal Joint Committee starts at the following time points:
1. At the time of the initial launch, for pharmaceuticals with new active ingredients that are launched for the first time from January 1, 2011 on. The inclusion of the pharmaceutical into the big German Specialty-list (so called. „Lauer-Taxe“) is deemed as the relevant time for the first marketing of the pharmaceutical.
2. Within four weeks from authorization of the new therapeutic indication, for pharmaceuticals that receive a new therapeutic indication pursuant to Section 2 para. 2, if a benefit assessment in accordance with these Procedural Rules was conducted for the pharmaceutical, or within four weeks of the notification of the pharmaceutical entrepreneur regarding approval of a variation of type II according to Annex II No. 2 Letter (a) of Commission Regulation (EC) No 1234/2008.
3. Within three months after request by the Federal Joint Committee, for pharmaceuticals launched prior to January 1, 2011;
4. Within three months after request by the Federal Joint Committee, for pharmaceuticals for which a benefit assessment has already been decided and for which the pharmaceutical entrepreneur has applied for another benefit assessment no earlier than one year after the decision;
5. On the day of deadline expiration for pharmaceuticals for which a time-limited decision regarding the benefit assessment has been made;
6. Three months after request by the Federal Joint Committee for pharmaceuticals according to §§ 12-15.
§ 9 Requirements regarding the dossier
(1) The dossier is meant for the assessment of the benefit of the pharmaceutical. The dossier has to be submitted in German as far as the instructions for the dossier do not state otherwise. In the dossier the pharmaceutical entrepreneur hast to prove the additional benefit of the pharmaceutical compared to the appropriate comparative therapy pursuant to the requirements of Section 5 and the instructionsin para. 2. The dossier must contain information on
1. Approved therapeutic indications;
2. The medical benefit;
3. The additional medical benefit in relation to the appropriate comparative therapy;
4. The number of patients and patient groups for whom there is a therapeutically meaningful additional benefit;
5. The cost of therapy for statutory health insurance;
6. The requirement for a quality-assured application.
(2) For the compilation of the materials the dossier template in annex II shall be used. The data pursuant to para. 1 and 4 to 8 shall be structured and submitted according the requirements given in modules 1 to 5. Modules 1 to 4 contain the basics supporting the assessment and these modules will be completely published on the website of the Federal Joint Committee. Documents containing business and trade secrets have to be indicated by the pharmaceutical entrepreneur in module 5.
(3) Even if the pharmaceutical entrepreneur contradicts the publication of documents in module 5 referring to Section 10 he shall ensure that all information regarding the methodology and results of the studies is completely submitted for publication in the dossier in modules 1 to 4 according to the requirements of para. 2 clause 2. If the dossier does not fulfill these requirements proof of the additional benefit can be deemed as not having been made.
(4) For the pharmaceutical to be assessed, the pharmaceutical entrepreneur submits in the dossier the result report of the marketing authorization studies including the
trial protocols and the assessment report of the regulatory agency, as well as all studies transmitted to the regulatory agency. Furthermore, all results, study reports and trial protocols for studies on the pharmaceutical are transmitted that were sponsored by the pharmaceutical entrepreneur, as well as all available information on ongoing or canceled studies involving the pharmaceutical, which were sponsored by the pharmaceutical entrepreneur or in which said entrepreneur participated financially in some other way, and corresponding information on third-party studies, if these are available.
(5) The dossier should also include the marketing authorization number, the date of marketing authorization, the marketing authorization holder, the central pharmaceutical number (PZN), the assignment to the anatomical-therapeutic-chemical (ATC) classification and the name of the pharmaceutical.
(6) For the appropriate comparative therapy, the pharmaceutical entrepreneur transmits all available results of clinical trials in the dossier, including study protocols that are appropriate for making findings on the additional benefit of the pharmaceutical to be assessed. If no clinical studies are available for a direct comparison with the pharmaceutical to be assessed or if they do not allow any sufficient conclusions regarding additional benefit, indirect comparisons can be submitted in the dossier.
(7) The pharmaceutical entrepreneur must indicate the costs for statutory health insurance measured by the pharmacy retail price and the costs actually incurred by the health funds. The costs must be indicated both for the pharmaceutical to be assessed and for the appropriate comparative therapy. Relevant are the direct costs for statutory health insurance over a certain time period. If the pharmaceuticals are used in accordance with the summary of product characteristics or the package leaflet and there are regularly differences in the necessary utilization of medical care or in the prescription of other services between the drug to be assessed and the appropriate comparative therapy, the associated cost differences must be considered for determining the costs actually incurred by the health funds.
(8) The dossier shall contain in module 1 a summary of the essential conclusions which shall be the basis for an agreement pursuant to Section 130b of the German Social Code Book V.
§ 10 Disclosure
(1) The dossier is published on the website of the Federal Joint Committee simultaneously with the benefit assessment according to Section 18 para. 4, unless this is precluded by business and trade secrets, the protection of intellectual property or data privacy. The publication shall include the fundamentals on which the assessment is based.
(2) The pharmaceutical entrepreneur shall indicate business and trade secrets in the dossier; this does not affect Section 9 para 2 and 3. This indication must not be in conflict with the obligation to disclose study results.
(3) The Federal Joint Committee can settle the details based on agreements with the relevant trade associations of the pharmaceutical industry and with the pharmaceutical entrepreneurs.
§ 11 Submission of the dossier
(1) Das Dossier ist spätestens zu den in § 8 bestimmten Zeitpunkten zu übermitteln. The Federal Joint Committee must only take documents submitted in due time into consideration. Documents from the regulatory agencies that were not yet available to the pharmaceutical entrepreneur at the time relevant for submission must be considered as long as the benefit assessment is not delayed as a result.
(2) The pharmaceutical entrepreneur may also transmit the dossier to the Federal Joint Committee before the times mentioned in Section 8. If the pharmaceutical entrepreneur submits the dossier to the Federal Joint Committee three weeks before the respective time, the office of the Federal Joint Committee will conduct a formal preliminary examination of the dossier for completeness validation. If the dossier is incomplete, the office of the Federal Joint Committee shall inform the pharmaceutical entrepreneur typically within two weeks what additional information is necessary. This does not affect the examination of the dossier in terms of content.
(3) The Federal Joint Committee shall request from the respective pharmaceutical entrepreneur the timely and complete submission of the dossier. The Federal Joint Committee may also request from the pharmaceutical entrepreneur the timely submission of a complete dossier after an advice pursuant to Section 7.
§ 12 Requirements regarding the dossier for orphan drugs
(1) For pharmaceuticals authorized for the treatment of an orphan disease according to Regulation (EC) No. 141/2000 of the European Parliament and the Council of 16 December 1999 on orphan medicinal products the requirements of this chapter shall be valid with the following requirements:
1. The medical additional benefit pursuant to Section 35a para. 1 clause 3 No. 2 and 3 of the German Social Code Book V is deemed to be proved by the marketing authorization; evidence according to Section 5 para. 1 to 6 need not be submitted. This does not affect Section 5 para. 7. The extent of the additional benefit shall be demonstrated for the number of patients and patient groups for whom a therapeutically relevant additional benefit exists.
2. If the turnover of the orphan drug made with statutory health insurance measured in retail pharmacy prices including value added tax within the last 12 months exceeds 50 million Euros the pharmaceutical entrepreneur shall transmit evidence pursuant to Section 5 para. 1 to 6 within 3 months after the request of the Federal Joint Committee and with this evidence he shall demonstrate the additional benefit compared to the appropriate comparative therapy. The turnover shall be calculated on the basis of the information pursuant to Section 84 para. 5 clause 4 of the German Social Code Book V.
§ 13 Request of a dossier by the Federal Joint Committee due to new scientific findings
(1) Following the request of its members or of the organisations and institutions mentionend in Section 139b para. 1 clause 2 of the German Social Code Book V due to new scientific findings the Federal Joint Committee may decide on a further benefit assessment no earlier than one year after the decision regarding the benefit assessment pursuant to Section 20 for a pharmaceutical which has been assessed according to the requirements of this chapter. This is also valid whenn the therapeutic area of the pharmaceutical has been restricted by the competent regulatory agency. Section 16 para. 2 applies accordingly.
(2) Together with the delivery of the decision the pharmaceutical entrepreneur shall be informed on the reasons for the benefit assessment.
§ 14 Request to submit a dossier following an application of the pharmaceutical entrepreneur due to new scientific findings
(1) The pharmaceutical entrepreneur can apply for a further assessment at the Federal Joint Commitee no earlier than one year after publication of the decision pursuant to Section 20, in case that he demonstrates the need for a further assessment due to new scientific findings.
(2) The Federal Joint Committee decides on the application within 3 months. If the Federal Joint Committee came to the conclusion that the application is justified it shall request the pharmaceutical entrepreneur to transmit the necessary evidence according to the requirements of this chapter. The dossier shall be submitted by the pharmaceutical entrepreneur to the Federal Joint Committee within 3 months after the delivery of the decision.
§ 15 Waiver of the benefit assessment according to Section 35a para. 1a of the German Social Code Book V
(1) At the latest 3 months before the relevant time pursuant to Section 8 the pharmaceutical entrepreneur may apply at the Federal Joint Committee for a waiver of the obligaton to submit evidence pursuant to Section 4 and of the benefit assessment
of the pharmaceutical according to the requirements of this chapter (especially sections 11 and 13) if it can be expected that this pharmaceutical will cause only insignificant expenditures for statutory health insurance. The assessment of the insignificance is made on the basis of information on the expected costs for the sick funds in the meaning of Section 9 para. 8 as well as the expected turnover of the pharmaceutical with statutory health insurance. As long as the expected expenditures do not exceed an amount of 1.000.000 Euros within 12 calendar months these are classified as insignificant.
(2) The pharmaceutical entrepreneur shall demonstrate the reasons for the waiver application according to para. 1. For the assessement of the insignificance of the expenditures he shall submit sufficient information for the Federal Joint Committee.
(3) The Federal Joint Committee decides on the application within 8 weeks.
(4) In case the turnover of the pharmaceutical with statutory health insurance at pharmacy retail prices exceeds 1.000.000 Euros within 12 calendar months the pharmaceutical entrepreneur shall transmit evidence pursuant to Section 5 para. 1 to 6 within 3 months after the request by the Federal Joint Committee and with this evidence he shall demonstrate the additional benefit compared to the appropriate comparative therapy. The turnover shall be calculated on the basis of the information according to Section 84 para. 5 clause 4 of the German Social Code Book V.
§ 16 Reguest of a dossier for marketed pharmaceuticals according to Section 1 para. 2 no. . 3
(1) For already authorized and marketed pharmaceuticals the Federal Joint Committee may decide on the conduct of a benefit assessment according to the requirements of this chapter, following a request of its members or of the organisations and institutions mentioned in Section 139b para. 1 clause 2 of the German Social Code Book V. As a priority these pharmaceuticals will be assessed which are important for the supply or which compete with pharmaceuticals for which a decision according to Section 20 exists.
(2) The dossier shall be submitted to the Federal Joint Committee by the pharmaceutical entrepreneur within three months after delivery of the decision.
§ 17 Decision on the conduct of a benefit assessment
(1) The Federal Joint Committee examines whether the pharmaceutical entrepreneur has fulfilled his legal obligation to submit a complete dossier in time. If the pharmaceutical entrepreneur hast not or not completely submitted the dossier to the relevant time points according to Section 8 in spite of being requested to do so the Federal Joint Committee makes a statement that the additional benefit of the pharmaceutical is not proven; the assessment of the benefit of the pharmaceutical is
hereby not affected. This applies respectively if the dossier is not complete at the relevant time points according to Section 8 in spite of a notification pursuant to Section 11 para. 2 clause 3
(2) The Federal Joint Committee decides whether to conduct the benefit assessment on its own or to commission the Institute for Quality and Efficiency in Health Care (IQWiG) or a third party.
(3) As far as the benefit assessment of a pharmaceutical shall be conducted on the basis of an assessment of the IQWiG or a third party the order shall be accompanied by the following requirements:
1. The benefit assessment shall be conducted respecting the principles laid down in these Prosedural Rules and
2. The finalised benefit assessment shall be transferred to the Federal Joint Committee two working days before the expiry of the relevant date for publication according to Section 18 para. 4.
§ 18 Benefit assessment
(1) The benefit assessment examines if an additional benefit compared to the appropriate comparative therapy has been proven for the pharmaceutical, what additional benefit has been proven, to what extent and for which patient groups, how the available evidence must be rated and with what probability each proof has been rendered. The benefit assessment is conducted on the basis of the dossier.
(2) The benefit assessment examines the validity and completeness of the information in the dossier. The materials are assessed with regard to their planning, implementation and evaluation quality in terms of their informative value for the probability and extent of an additional benefit and regarding their information on therapy costs. The benefit assessment also contains a summary of the essential conclusions as a rating of the information in the dossier according to Section 9 para. 1. The benchmark for the assessment is the generally acknowledged state of medical knowledge. Basis of the assessment are the international standards of evidence-based medicine and health economics.
(3) For the initial evaluation pursuant to Section 35a of the of the German Social Code Book V at the time of market launch, the assessment of a pharmaceutical with new active ingredients must be based on marketing authorization studies. If these marketing authorization studies are insufficient, the Federal Joint Committee can demand additional proof.
(4) If it is not possible that valid data on patient-relevant endpoints are available at the time of evaluation, the assessment is made based on the best available evidence
in consideration of the study quality and the probability of a proven additional benefit is indicated. If valid data on patient-relevant endpoints are necessary to prove an additional benefit, a deadline can be determined by the Federal Joint Committee by which the data should be submitted at the latest.
(5) The benefit assessment must be completed no later than three months after the date that is relevant pursuant to Section 8 and be published on the internet.
§ 19 Legal comments procedure
(1) By publishing the benefit assessment on the website of the Federal Joint Committee the experts of medical and pharmaceutical science and practice as well as the leading organisations of the pharmaceutical companies created for the representation of their economic interests, the concerned pharmaceutical companies, the representatives of the pharmacists and the leading overarching associations of the medical societies of the special therapies on the federal level will have the opportunity to comment in writing on the benefit assessment of the pharmaceutical by using the templates in annex III. The commenting period will be 3 weeks.
(2) After the written comments procedure and before the decision making on the benefit assessment according to Section 92 para. 1 clause 2 no 6 of the German Social Code Book V the Federal Joint Committee offers the parties mentioned in para. 1 the opportunity to make also oral comments on the benefit assessment. As far as the parties have commented in writing according to para. 1 the experts may participate in the oral hearing as well as max. two representatives of the organisations and concerned companies according to para. 1. The oral comment does not substitute the comment according to para. 1. Its purpose is especially to
1. Make statements on those aspects of the benefit assessment, especially newer scientific findings which have been made known in the time after submission of the dossier and
2. Give comments on the possibilities of the decision making of the benefit assessment pursuant to Section 92 para. 1 clause 2 no. 6 of the German Social Code Book V according to the principles laid down in these Procedural Rules.
(3) The written and oral comments pursuant to para. 1 and 2 will be considered in the decision on the decision making on the benefit assessment according to Section 92 para. 1 clause 2 no. 6 of the German Social Code Book V. For the evaluation of the comments chapter 1 Section 10 para. 3 of the Procedural Rules shall apply.

Chapter 4: Decision making and implementation of the benefit assessment into the Pharmaceutical Guideline

§ 20 Decision making on the benefit assessment
(1) The Federal Joint Committee decides on the benefit assessment within three months from publication. The decision will be published on the internet. It shall be part of the Pharmaceutical Guideline pursuant to Section 92 para. 1 clause 2 no. 6 of the German Social Code Book V and is published in the Federal Gazette. Section 94 para. 1 of the German Social Code Book V does not apply.
(2) For all pharmaceuticals with this active ingredient, the decision forms the basis for negotiations regarding reimbursement amounts pursuant to Section 130b of the of the German Social Code Book V and for the stipulation of requirements pertaining to the suitability, quality and economic efficiency of the prescription as well as for recognition as a practice specialty or for the assignment of pharmaceuticals without additional benefit to a reference price group in accordance with Section 35 of the of the German Social Code Book V.
(3) Based on the benefit assessment with the decision pursuant to Section 35 para. 3 the Federal Joint Committee makes findings in the Pharmaceutical Guideline on the economic prescription, especially
1. On the additional benefit of the pharmaceutical compared to the appropriate comparative therapy
2. On the number of patients respectively on the differentiation of patient groups eligible for the treatment.
3. On the requirements regarding a quality assured application and
4. On the therapy costs also compared to the appropriate comparative therapy.
§ 21 Pharmaceuticals without additional benefit
If the benefit assessment comes to the result that for the pharmaceutical with the new active ingredient no therapy relevant additional benefit is proven according to the generally acknowledged state of medical knowledge it shall be examined according to the requirements of no. 1 and 2 whether the pharmaceutical can be assigned to a reference price group in accordance with Section 35 para. 1 clause 2 no. 2 of the German Social Code Book V:
1. Pharmaceuticals with a new active ingredient which are pharmacologically-therapeutically comparable to reference price drugs according to Section 35 para. 1 clause 2 no. 2 of the German Social Code Book V for which a reference price group exists are assigned to this reference price group by the decision.
2. If the assignment of the pharmaceutical with a new active ingredient to an existing reference price group according to Section 35 para. 1 clause 2 no. 3 of the German
Social Code Book V is possible the Federal Joint Committee states this in the decision according to Section 35 para. 3 of the German Social Code Book V.
3. In all other cases the Federal Joint Committee examines whether the creation of a reference price group in accordance with Section 35 para. 1 clause 2 no. 3 of the German Social Code Book V and Chapter 4 Section 20 of the Procedural Rules is possible.
§ 22 Pharmaceuticals with additional benefit
If the benefit assessment comes to the conclusion that an additional benefit for the pharmaceutical is proven according to the generally acknowledged state of medical knowledge, the Federal Joint Committee will state this in its decision pursuant to Section 35a para. 3 of the German Social Code Book V in the Pharmaceutical Guideline together with information on the extent of the additional benefit.

Germany: GBA publishes details of the benefit assessment of medicines

The German GBA has published today the details of the benefit assessment of drugs. It is quite a massive document and in German only for the time being. I will post a more in depth summary in English once I had time to digest it.

From 2011 onwards new medicines will have to undergo a benefit assessment. The GBA will commission this to IQWIG or other third parties. Prices can be freely set for the first six month, if no additional benefit can be demonstrated the drug will thereafter automatically be part of the therapeutic reference price system. If an additional therapeutic benefit is established manufacturers will negotiate prices with the statutory health insurance funds, if no agreement can be reached prices will be fixed by an independent arbitrary commission taking into consideration the EU price level.

http://www.g-ba.de/informationen/beschluesse/zum-aufgabenbereich/47/

Cost containment in Hungary

Dear All,
2011 hasn't even started yet but in the CEE countries the cost containment measures due to budgetary crisis are widening out again. This time it is Hungary that is tightening the belt. On January the 13th the Hungarian Prime Minister announced significant saving measures in three key areas, one of them the state subsidiary of drugs. It was said that these reforms would cut expenditures by HUF 600-800 billion (€2.2 billion).
In order to cut drug spending the government may apply various measures. It might resort to what happened in Greece in 2010, a "simple" mandatory price cut for all reimbursed drugs by a certain percentage or perhaps more likely, given the already low prices in Hungary, to decreasing the reimbursement cap level for certain medicines. Another option, among others, might be to leave ex-factory prices intact but decrease the level of reimbursement for the relatively cheaper drugs.
I hope the Hungarian government applies sensitive measures considering the wider EU impact that these cost-containment measures may have and to not de-incentivize certain areas of patient benefit by simple cost cutting arithmetic’s.
We will report how this turns out.
Ulf

Health Economists and Statisticians in the evolving HTA field- what is the way foreward?

Dear Readers,

please find below a summary from a recent Pharma IQ podcast about HTA developments and the future role and interaction of health economists and statistician. While there is a clear improvement of statistical techniques used in health economics analysis over the last decade there is still a lot to be agreed upon when it comes to the methods used for indirect comparisons in relation to relative effectiveness. In the oncology field, additional concerns are the extrapolations of intermediate endpoints such as progression free survival to overall survival - often causing debates when it comes to what statistical technique to use; or how to account for cross over in trials etc. The podcast gives some interesting insights and is timely as to the current HTA discussions. Needless to mention that at the same time we should beware not to create a statistical overkill and avoid that lengthy statistical discussions cause market access delays but rather focus on agreements as to how to create the lacking evidence.

Enjoy the podcast.
Regards
Ulf


Chrissie Fletcher, Director and Head of International Biostatistics at Amgen, joins Pharma IQ to discuss the way forward for Health Technology Assessment.

Chrissie Fletcher joined Pharma IQ to talk about Health Technology Assessment. In this comprehensive podcast, she discussed how she sees health economists and statisticians interacting going forwards, why there is so much emphasis on reporting for reimbursement and whether she expects pharma companies will try and do this more in-house, in the future. She also offered her thoughts on health economists who don’t have a statistical background, how she sees the HTA evolving and its place in the next 5-10 years.

According to Chrissie, reporting for reimbursement is becoming more important because it is what all the clinical trial programmes form the basis of, the evidence that they’re going to try and use to demonstrate the clinical effectiveness of the products, also the safety, as well as the cost effectiveness. In order for this to be really successful there is a clear need for transparency. ” We want to be sure that all the information that we generate throughout our drug development process is visible, it’s published in a timely fashion. And of course in order to make sure that we minimise any publication bias, we want to make sure all results, whether they’re positive or negative, are actually published” says Chrissie.

Chrissie has also mentioned that Health Technology Assessment has been evolving for number of years and the importance is continuing to increase. She discussed in details a couple of areas: the concept of the relative effectiveness or so called comparative effectiveness research:  ” On the health sector Health Development Agency (HDA) side, this is now becoming more and more important, but Health Technology Assessment is more local. The regulatory approach has often has a very specific regional focus and I’ll say the European Medicines Association for Europe and the Food and Drug Administration for the US. But HDA people in the UK in Australia and in Canada are very local. So there has been some kind of a disconnect to some degree in terms of what the regulators focus on and what the payers focus on.”

If you want to listen to the full interview, you can download it from HTA Forum website: http://bit.ly/gBT8uJ

The interview has been conducted in relation to Pharma IQ’s Health Technology Assessment conference, taking place 05 – 07 April, 2011 in London. If you want to find out more, please go to: www.htaforu

International Healthcare Payers & HTA Summit

Managing a Limited Budget for Expensive Medicines Whilst Encouraging Innovation
Conference Dates: 16th & 17th March, 2011
Venue: Berlin, Germany

This meeting will provide an ideal opportunity for “payers” and other decision makers from both public and private organisations, to benchmark with peers internationally. Attendees will be able to understand and develop best practice approaches to such vital and common challenges, with the ultimate goal of encouraging innovation and improving patient access to novel and powerful medications.

Payers/HTAs/Insurers — Why attend?
• Benchmark and network with payers, HTAs, insurers, health departments from around the world who are facing the same challenges: restricted budgets, limited evidence, the need to find savings and pressure to increase health outcomes without massive budget impact.
• Understand the latest developments and methodologies to improve HTA to enable smarter, faster decision making on innovative drugs.
• Find out other ways to cut costs, such as improving prescriber guidance and incentives, enhancing patient adherence to avoid wastage and raise outcomes.
• Work out how to improve communication with the pharma industry and improve pre and post approval scientific guidance, to obtain the most-relevant, accurate data that you need to help you make the right decisions.
• Have your say! Be part of a personal, interactive environment and the chance to help lead the debate on issues crucial to the future healthcare and patient access.
• Gain an insight into the future of HTA and regulatory harmonization at the local, national, regional and global levels, and discover what could be the models of the future.
• Learn why the global drug development, pricing and reimbursement systems are unsustainable and put forward your ideas in terms of possible solutions.

Who will benefit?
PRIMARILY: Senior representatives from health plans & insurers, payers, health technology assessors, hospital financial management, government & health ministry officials, health management and managed care organizations.
STAKEHOLDERS: Regulatory agencies, key-opinion-leaders, independent health economists and academics, physicians, patient groups and other key stakeholders.
INDUSTRY: A strictly limited number of senior pharmaceutical industry representatives.

Agenda request
To request the full agenda please follow the link:
http://www.nextlevelpharma.com/events/request_agenda/international_pharmaceutical_payers_hta_summit

For Booking Information contact:
Erika Vavrovicova

Tel: +421 232 660 382
Fax: +421 233 010 331
Email: erika@nextlevelpharma.com
Visit: www.nextlevelpharma.com

HTA academy 2011/2012

Dear All,

wishing everyone a happy and successful 2011! Please find below the announcement of the 2011/2012 cycle of Pfizer’s HTAcademy, which may be of interest to you. Further information is available on www.htacademy.eu.

HTAcademy – Pfizer's scholarship program for up-and-coming scientists
in the field of Health Technology Assessment

From now until March 31, 2011, graduates at the start of their academic careers from Belgium, Germany, the Netherlands and Switzerland are invited to apply for the HTAcademy scholarship. The goal of the HTAcademy is to promote the further development of Health Technology Assessment (HTA) as an important instrument for the
evaluation of healthcare technologies. The scholarship is announced once a year.
Each participating country will award a national scholarship of €5,000 – €10,000 to an applicant whose work contributes substantially to the further development and application of the HTA concept. The project proposals of the national scholarship winners will then be evaluated by a European expert committee, who will award the European prize of €40,000 to the most promising entry. Eligible candidates may come from, for example, the fields of medicine, health sciences, health economics, psychology or medical ethics. This year’s thematic focus is on the processes and methodology of HTA and the role of HTA in policy making and health system design. Further information about the HTAcademy scholarship program including application forms for download can be found at www.htacademy.eu.