The costs and benefits of regulations for reimbursement of new drugs

Abstract

Introduction An increasing regulation for pricing and reimbursement decisions is associated with both costs and benefits. One potential cost is a delayed introduction of drugs on the market. The objective of this study was to discuss and analyse the time lag between drug authorisation and reimbursement for new chemical entities (NCEs) in Sweden and Finland. Materials and methods The study was based on a sample of 242 NCE drugs, authorised by the regulatory authorities in Sweden or Finland between January 1995 and April 2003. Data on authorisation dates, reimbursement dates, capacity of manufacturing companies, requirements for economic evaluations by reimbursement authorities, anatomic therapeutic classification, therapeutic value and sale statistics were collected for the drugs. A hypothesis, saying that the lag is affected by the increasing regulation associated with the introduction of formal requirements for cost-effectiveness information for pricing and reimbursement decisions, was tested. Results One hundred and thirty-eight of the 242 drugs included in the analyses were reimbursed in Sweden and 104 in Finland. The total mean lag time was 175 days, and the mean lag times in Sweden and Finland were 114 and 256 days, respectively. Regression analysis demonstrated that drugs with low sale and drugs from companies with large capacity of introducing new drugs were associated with a longer and shorter lag times, respectively. The results also demonstrated that authorisation during first year after introduction of requirement for cost-effectiveness information was associated with an increased lag time. Discussion The results demonstrated that there are considerable time lags between authorisation and reimbursement of new drugs, both in Sweden and Finland. The results further indicated that an increased regulation for reimbursement by introducing requirements for cost-effectiveness information is associated with an increased time lag, at least for drugs authorised early after introduction of the new requirements. It is therefore important to further discuss the costs and benefits of an increased regulation for reimbursement, in order to find the optimal regulatory requirements.