Roche Worried About German Proposal To Report Drug Prices
Roche expressed concern about Germany’s proposed legislation to require drugmakers to reveal rebated costs for medicines. The legislation could potentially drive drug prices down in the country and elsewhere in Europe.
Health ministry spokeswoman Ina Klaus said the law revision would serve to clarify that listed drug prices are not what are actually paid in Germany. The proposed law would do away with referrals to “rebates” negotiated between insurers and drug manufacturers and instead refer to “reimbursement.” This means drugmakers have to comply with the law and reveal reduced prices they have agreed with insurers, rather than disclose the original list price.
Hagen Pfundner, Head of Basel, Switzerland-based Roche Holding AG’s German business, said at a press conference in Frankfurt, “Some people think it’s pure semantics, but it’s a huge difference.” Pfundner noted that negotiations with insurers are about price and not discounts. He said the proposal could potentially limit flexibility for drug manufacturers since rebates are renegotiable and applicable for a limited time and/or volume, while products are non-renegotiable under the same terms. Pfunder also suggested reimbursement levels in Germany might influence other European nations and markets given that these look to Germany as a reference for drug pricing.
M. M. Warburg analyst Ulrich Huwald commented, “Right now, the negotiated (discounted) price is not readily available information. I think pharma companies have a point in demanding that it stays that way. ..They have a right to confidentiality and more disclosure would hurt their business.”
Ann Marini, a spokeswoman for the National Association of Statutory Health Insurance Funds, differed. "Practically speaking, it's the same thing that we've been doing for years," she said of the proposed revision. Drug makers are allowed to set list prices for new innovative medicines during their first year in the market, while the national association negotiates rebates following cost-benefit assessments directed by Germany’s Federal Joint Committee. Roche’s breast cancer treatment Kadcyla (ado-trastuzumab emtansine) is currently undergoing the process.
The German parliament will vote on the proposed legislation this coming Friday. If approved, the proposal will become law effective April 1, 2014.
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