Public Pharmaceutical Expenditure Research Articles

HPR192 An Assessment of the Impact of the Three Memorandum Policies on Health Outcomes of the Greek Population

Optimizing the value of pharmaceutical spending is an important goal for effective and sustainable health systems. During the economic crisis, Greece undertook a set of strict fiscal policies to contain public pharmaceutical expenditure. The objective of this study is to investigate the social inefficiencies stemming from the regulatory framework of the Greek health system, with an emphasis on the effects of the policy reforms during the economic crisis on health outcomes.

Exploring the effectiveness of demand-side retail pharmaceutical expenditure reforms

Increasing expenditures on retail pharmaceuticals bring a critical challenge to the financial stability of healthcare systems worldwide. Policy makers have reacted by introducing a range of measures to control the growth of public pharmaceutical expenditure (PPE). Using panel data on European and non-European OECD member countries from 1990 to 2015, we evaluate the effectiveness of six types of demand-side expenditure control measures including physician-level behaviour measures, system-level price-control measures and substitution measures, alongside a proxy for cost-sharing and add a new dimension to the existing empirical evidence hitherto based on national-level and meta-studies. We use the weighted-average least squares regression framework adapted for estimation with panel-corrected standard errors. Our empirical analysis suggests that direct patient cost-sharing and some—but not all—demand-side measures successfully dampened PPE growth in the past. Cost-sharing schemes stand out as a powerful mechanism to curb PPE growth, but bear a high risk of adverse effects. Other demand-side measures are more limited in effect, though may be more equitable. Due to limitations inherent in the study approach and the data, the results are only explorative.

New Zealand national retrospective cohort study of survival outcomes of patients with metastatic melanoma receiving immune-checkpoint inhibitors.

Immune checkpoint inhibitors (ICIs) have increased overall survival (OS) in metastatic melanoma in all clinical trials to date. However, pivotal trial populations were not representative of the real-world population in New Zealand. Real-world treatment effectiveness studies help evaluate the value of public pharmaceutical expenditure. To determine the survival outcomes of New Zealand patients with unresectable or metastatic melanoma treated with pembrolizumab or nivolumab. This is a national retrospective cohort study. Patients with advanced unresectable or metastatic melanoma who received publicly funded immune-checkpoint inhibitors (ICIs) from 2017 to 2019 were included. Individual patient data were extracted from national administrative databases. The primary endpoint was OS, and secondary endpoints included OS by age, duration of treatment, posttreatment survival, and 30-day mortality from last pharmaceutical claim. Five hundred ninety-seven patients were included, with a median follow-up of 25 months. One-year OS was 72%, the 2-year OS estimate was 60%, and median OS not reached. Survival did not differ by dichotomized age (≥70 vs. <70 year old), hazard ratio (HR) .94 (95% confidence interval (CI): .72-1.22; p = .62). Median duration of treatment was 9.0 months (95% CI: 7.9-10.1). Median post-treatment survival for the subgroup who had ceased treatment was 12.0 months (95% CI: 9.0-14.0). For the sample as a whole, the estimated 30-day mortality from last pharmaceutical claim was 15.7%. OS in our New Zealand real-world population is comparable to pivotal clinical trials and real-world data (RWD) from other countries. These findings support the achievement of health gains from use of ICI in advanced unresectable and metastatic melanoma.

The Pharmaceutical Policy Reforms in Greece during the Economic Crisis, 2010-2015

In the decade 2000-2009 Greece had the higher rate of public pharmaceutical expenditures as a percentage out of the total public health expenditure and the bigger per capita consumption of public pharmaceutical expenditure among the EU countries. At the end of this decade, Greek governments confronted with this “paradox” and tried to reduce it unsuccessfully. In order to finance its debt, Greece took a financial package of 110 billion € from Troika of the European Commission (EC), European Central Bank (ECB), and International Monetary Fund (IMF) under strict conditions and adopted austere policies designed by Troika all over the public finance sector in order to reduce its debts. Our aim is to provide an overview of new legislation starting from the first memorandum until the first quarter of 2014 and to record the impact of pharmaceutical reforms in all over the pharmaceutical chain. The legislation of this period had the reduction in public pharmaceutical expenditures as a primary endpoint. The new laws focus on new drug pricing policies, profit control regulations, and demand regulations. The economic targets in order to decrease public pharmaceutical expenditures were achieved but not without cost, all the parts in the pharmaceutical chain were affected, especially the last link the patients.

Switch from public to private retail pharmaceutical expenditures: evidence from a time series analysis in Italy

ObjectivesTo analyse trajectories of retail pharmaceutical expenditures from 2010 to 2019 in Italy to investigate whether there was a switch from public to private expenditure, how the composition of private...

Pharmaceutical expenditure: what has changed in ten years in Italian Health Care System?

Abstract Introduction In the last 20 years, Italian pharmaceutical policies have moved to contain public expenditure. This study analyses the trajectory of retail pharmaceutical expenditures to investigate whether there has been a switch from public to private expenditure, how the composition of private and public expenditure has changed, and whether there are correlations with supply/demand variables. These research questions have received little attention in the literature. Methods This study used secondary data from Italy covering the period 2010 to 2019. A time-trend analysis was performed using the average annual percent change (AAPC) as the summary measure for the rate of change over the period 2010/19. The AAPC was estimated by fitting a linear regression model for the logarithm of each aggregate indicator. Kendall's τ coefficient investigates the correlation between the 2010-19 pharmaceutical expenditure items and other relevant health statistics (ages, categories of practising physicians, Gini coefficient, etc.). Results Italy's public pharmaceutical expenditure did not change significantly between 2010 and 2019 (AAPC = +0.03%, 95% CI = -1.4% to + 1.4%), nor did private spending (AAPC = +0.6%, 95% CI = -0.2% to + 1.3%). Public expenditure without the direct distribution of drugs in class A experienced a slowdown (-3.9%), and public expenditure with the direct distribution of drugs in class A exhibited a significant increase (+8.4%). The regression analysis evaluates the relationship between supply/demand variables and pharmaceutical expenditures. A significant result relates to the positive correlation between income inequality and out-of-pocket expenses for over-the-counter drugs (τ = 0.62, p-value = 0.046). Conclusions Pharmaceutical spending has increased over time, especially for drugs reimbursable by the NHS but paid for by citizens. This could be an alarm for a public healthcare system that should be able to guarantee healthcare services to all citizens. Key messages Public expenditure with the direct distribution of drugs in class A exhibited a significant increase (+8.4%). There has been increasing expenditure on drugs reimbursable by the NHS but paid for by citizens.

PP138 Current Status Of Healthcare Decision Making And Future Perspective Of The Health Technology Assessment Implementation Roadmap In Turkey

IntroductionTurkey's health reforms, which started in 2003, have led to increased access to health care and pharmaceuticals as well as rising public pharmaceutical expenditures. The need to improve healthcare decision making by implementing health technology assessment (HTA) has become an important priority for Turkey. This study sought to provide a tailor-made HTA implementation roadmap, drawing on insights from national stakeholders.Our study aimed to describe the current HTA environment in Turkey and to explore long-term perspectives and suggestions from a wide spectrum of Turkish stakeholders regarding the preferred status of HTA in ten years (by 2029).MethodsWe conducted an online survey using a questionnaire previously applied in other HTA research. We assessed the current evaluation of medical and economic decision-making processes and examined the need for HTA. We also ascertained stakeholder perspectives on potential developments that can be done together with policymakers, representatives of pharmaceutical companies, and patient organizations. We also included general information about the pharmaceutical market and decision making processes in Turkey.ResultsThe survey was sent to various stakeholders from different areas within the health system. Additional face-to-face interviews were conducted with a few respondents to clarify some of their answers. A total of twenty-seven Turkish stakeholders completed the survey. Of these, twenty-one (78%) participants were employed in the public sector and six (22%) were from the private sector. The majority of the participants would introduce HTA for all new health technologies being considered for public reimbursement and institute an additional review process for currently reimbursed technologies. Most of the respondents considered that only new technologies with significant budget impact should be evaluated in the next ten years.ConclusionsIt is clear that Turkey needs to implement an HTA process in the future. Our study shows stakeholder expectations, which will be helpful for creating an HTA implementation roadmap, and it is clear that different stakeholders have different views and expectations about HTA implementation in Turkey. The experiences of other countries will also be helpful during the implementation process.

Access to medicines in Turkey: Evaluation of the process of medicines brought from abroad.

Turkey's health reforms started in 2003 with providing changes in regulatory, financing, and healthcare services. Access to health care and pharmaceuticals increased rapidly, and this resulted with an increase in public pharmaceutical expenditures. Our study aims to quantify and to evaluate the impact of a specific process within the Turkish system called "Medicines Brought From Abroad" (MBFA). We reviewed the general reimbursement legislations of Social Security Institution (SSI), the guideline on MBFA, the SSI reimbursement list, the list of MBFA published by the Ministry of Health to describe the current supply mechanism of medicines and, in particular, the role of MBFA. Total costs of the of MBFA medicines over the period 2011-17 went up to more than $520 million, which takes 7.5 percent of total public pharmaceutical expenditure for 2017. Our results showed that MBFA provides access to many orphan drugs and in total, forty-two orphan drugs listed in MBFA accounted for 83 percent of all MBFA budget in the year 2017. Nine of the top ten MBFA medicines were orphan drugs and total costs were $408 million. The highest budget impact was for eculizumab for "paroxysmal nocturnal hemoglobinuria" (PNH), covering 31 percent of total MBFA costs and 2.3 percent of overall drug costs in 2017. Turkey faced significant challenges for creating an access pathway for innovative medicines while continuing the sustainability of the public pharmaceutical budget like many other countries. Therefore, it may be argued that Turkey needs to create an independent health technology assessment organization to provide sustainable access to medicines in the future.

Can a Different Formulation of Vitamin D3 Allow Savings? An Analysis From an Italian Regional Perspective.

Vitamin D3 reported in Italy in 2017 the net expenditure of almost €180 million, reaching the first place for consumption and the third place for conventional pharmaceutical spending. The aim of the study was to evaluate whether a shift of vitamin D3 prescriptions toward 100 000 IU formulation, less costly, could allow savings from the health-care perspective. An approach promoting the prescription of this formulation has been applied in a local health authority (ASL CN2) in Piedmont Region (Italy) starting from 2015. The retail pharmaceutical market and the consumption of vitamin D3 has been analyzed from year 2014 to 2017 in order to evaluate differences in expenditures. Despite an increase in consumption, the introduction of the new formulation enabled ASL CN2 to save about €280 000 in 2017 considering the regional average expenditure per 1000 inhabitants as a reference. If Piedmont Region had presented an average expenditure in line with that of ASL CN2, the annual regional savings would have exceeded €7 million in 2017 alone. A shift of vitamin D3 prescriptions toward 100 000 IU formulations would allow reducing costs from the payer perspective. Savings may be used to contain public pharmaceutical expenditure or can be allocated to fund other health-care technologies and services.

The European challenges of funding orphan medicinal products

BackgroundFunding of orphan medicinal products (OMPs) is an increasing challenge in the European Union (EU).ObjectivesTo identify the different methods for public funding of OMPs in order to map the availability for rare disease patients, as well as to compare the public expenditures on OMPs in 8 EU member states.MethodsInformation on the reimbursement status of 83 OMPs was collected in 8 countries by distinguishing standard and special reimbursements. In two consecutive years, the total public expenditures on OMPs were calculated by using annual EUR exchange rates. Annual total public expenditures were calculated per capita, and as a proportion of GDP, total public pharmaceutical and healthcare budgets. Differences between countries were compared by calculating the deviations from the average spending of countries.ResultsIn 2015 29.4–92.8% of the 83 OMPs were available with any kind of public reimbursement in participant countries including special reimbursement on an individual basis. In Austria, Belgium and France more OMPs were accessible for patients with public reimbursement than in Bulgaria, Czech Republic, Hungary and Poland. Standard reimbursement through retail pharmacies and/or hospitals was applied from 0 to 41% of OMPs. The average annual total public expenditure ranged between 1.4–23.5 €/capita in 2013 and 2014. Higher income countries spent more OMPs in absolute terms. Participant countries spent 0.018–0.066% of their GDPs on funding OMPs. Average expenditures on OMPs were ranged between 2.25–6.51% of the public pharmaceutical budget, and 0.44–0.96% of public healthcare expenditures.ConclusionsStandard and special reimbursement techniques play different roles in participant countries. The number of accessible OMPs indicated an equity gap between Eastern and Western Europe. The spending on OMPs as a proportion of GDP, public pharmaceutical and healthcare expenditure was not higher in lower income countries, which indicates substantial differences in patient access to OMPs in favour of higher-income countries. Equity in access for patients with rare diseases is an important policy objective in each member state of the EU; however, equity in access should be harmonized at the European level.

Pharmaceutical expenditure and gross domestic product: Evidence of simultaneous effects using a two-step instrumental variables strategy.

This paper estimates the income elasticity of government pharmaceutical spending and assesses the simultaneous effect of such spending on gross domestic product (GDP). Using a panel dataset for 136 countries from 1995 to 2006, we employ a two‐step instrumental variable procedure where we first estimate the effect of GDP on public pharmaceutical expenditure using tourist receipts as an instrument for GDP. In the second step, we construct an adjusted pharmaceutical expenditure series where the response of public pharmaceutical expenditure to GDP is partialled out and use this endogeneity adjusted series as an instrument for pharmaceutical expenditure. Our estimations show that GDP has a strong positive impact on pharmaceutical spending with elasticity in excess of unity in countries with low spending on pharmaceuticals and countries with large economic freedom. In the second step, we find that when the quantitatively large reverse effect of GDP is accounted for, public pharmaceutical spending has a negative effect on GDP per capita particularly in countries with limited economic freedom.

PSY188 - USE OF MANAGED ENTRY AGREEMENTS IN INFLAMMATORY DISORDERS AMONG KEY HEALTH TECHNOLOGY ASSESSMENT AGENCIES

Recession and cuts in public pharmaceutical expenditure have limited access to market of pharmaceutical innovations in last few years. As a solution, public health authorities and pharmaceutical companies have searched for alternative funding formulas, such as managed entry agreements (MEAs) to share the risks and uncertainties arising from public coverage of new products. This review aims to identify the use of MEAs in selected inflammatory disorders among key health technology assessment (HTA) agencies in Australia, Canada, and Europe. HTA decisions in rheumatoid arthritis (RA), psoriatic arthritis (PsA), psoriasis, Crohn’s disease, and ulcerative colitis (UC) published between 2013 and 2018 across seven HTA agencies were reviewed for use of MEAs. The number and type of MEAs by therapeutic area and agency were assessed. The review identified 295 HTA submissions, which assessed 39 interventions across five inflammatory conditions. Across all seven HTA agencies, 85% of submissions resulted in an intervention being recommended or recommended with restrictions, of which 19% of recommendations included an MEA. Use of MEAs was highest in UC (24%), followed by RA and PsA (22% each). The maximum use of MEAs was observed in the UK (National Institute of Clinical Excellence [NICE]: 86%, Scottish Medicines Consortium [SMC]: 41%). HTA agencies in Canada, France and Germany did not use MEAs for any of the reviewed indications. The application of MEA differed across different indications and agencies for the same intervention. All MEAs were financial based and the majority included a fixed discount to the drug cost. The use of MEAs was limited to biological drugs only. Currently, the use of MEAs for inflammatory disorders is limited and financial based. MEAs are likely to play a substantial role in market access negotiations in future for development and early access to novel biological therapies in these indications.

Higher pharmaceutical public expenditure after direct price control: improved access or induced demand? The Colombian case

BackgroundHigh pharmaceutical expenditure is one of the main concerns for policymakers worldwide. In Colombia, a middle-income country, outpatient prescription represents over 10% of total health expenditure in the mandatory benefits package (POS), and close to 90% in the complementary government fund (No POS). In order to control expenditure, since 2011, the Ministry of Health introduced price caps on inpatient drugs reimbursements by active ingredient. By 2013, more than 400 different products, covering 80% of public pharmaceutical expenditure were controlled. This paper investigates the effects of the Colombian policy efforts to control expenditure by controlling prices.MethodsUsing SISMED data, the official database for prices and quantities sold in the domestic market, we estimate a Laspeyres price index for 90 relevant markets in the period 2011–2015, and, then, we estimate real pharmaceutical expenditure.ResultsResults show that, after direct price controls were enacted, price inflation decreased almost − 43%, but real pharmaceutical expenditure almost doubled due mainly to an increase in units sold. Such disproportionate increase in units sold maybe attributable to better access to drugs due to lower prices, and/or to an increase in marketing efforts by the pharmaceutical industry to maintain profits.ConclusionsWe conclude that pricing interventions should be implemented along with a strong market monitoring to prevent market distortions such as inappropriate and unnecessary drug use.

Between pharmaceutical patents and European patients: is a compromise still possible?

ABSTRACTIntroduction: Pharmaceutical regulation has always attempted to balance the public health objective to make safe and effective drugs available for patients while providing commercial incentives through patents. Here we discuss whether it is still possible to find a balance between the incentives on the supply side and the regulatory framework on the demand side.Areas covered: The current regulatory framework on pharmaceutical exclusivity has been harshly criticized by many experts, arguing about whether it is still fit for public purposes and needs. Here we envisage a different scenario without ‘revolutionizing’ the whole present system.The main radical change should concern the present management of pharmaceutical patents by introducing a specific agency dedicated to them. Secondly, specific pharmaceutical patents could be restricted to compounds for one (or more) declared indication(s). Thirdly, pharmaceutical patents should be kept only for compounds that start a first clinical trial within five years from the granting date.Expert opinion: We think it is time to reconsider the regulation of pharmaceutical patents in the light of their relevance in terms of public health. New models of enhancing research investments are required for long-term sustainability of public pharmaceutical expenditure and the EU can still play a leading role

Why do generic drugs fail to achieve an adequate market share in Greece? Empirical findings and policy suggestions

ObjectivesSince 2010, the memoranda of understanding were implemented in Greece as a measure of fiscal adjustment. Public pharmaceutical expenditure was one of the main focuses of this implementation. Numerous policies, targeted on pharma spending, reduced the pharmaceutical budget by 60.5%. Yet, generics’ penetration in Greece remained among the lowest among OECD countries. This study aims to highlight the factors that affect the perceptions of the population on generic drugs and to suggest effective policy measures. MethodologyThe empirical analysis is based on a national cross-sectional survey that was conducted through a sample of 2003 individuals, representative of the general population. Two ordinal logistic regression models were constructed in order to identify the determinants that affect the respondents’ beliefs on the safety and the effectiveness of generic drugs. FindingsThe empirical findings presented a positive and statistically significant correlation with income, bill payment difficulties, safety and effectiveness of drugs, prescription and dispensing preferences and the views toward pharmaceutical companies. Also, age and trust toward medical community have a positive and statistically significant correlation with the perception on the safety of generic drugs. Policy interventions are suggested on the bases of the empirical results on 3 major categories; (a) information campaigns, (b) incentives to doctors and pharmacists and (c) to strengthen the bioequivalence control framework and the dissemination of results.

The AKP between populism and neoliberalism: lessons from pharmaceutical policy

AbstractIn September 2009, Turkey experienced a major reform of its pharmaceutical expenditure and price policy. By introducing a global budget, Turkey saved some 20 billion TL in public pharmaceutical expenditure in the 2010–2012 period. The lion’s share of this was achieved by introducing stricter price controls that reduced the profit margins of pharmaceutical producers and distributors (the populist policy solution), rather than by privatizing the cost of medicines through, for example, raising out-of-pocket payments (the neoliberal policy solution). This is a puzzle, given the Justice and Development Party (Adalet ve Kalkınma Partisi, AKP) government’s usual preference for lenient and business-friendly regulation. This article explains the policy reform with reference to (i) the pronounced electoral interests of the AKP’s political leadership in not substantially reducing access to public health services, (ii) the absence of powerful business interests in high medicine prices, and (iii) the absence of a developmentalist commitment to an industrial policy strategy for the pharmaceutical sector. This case study holds important lessons for scholars of Turkish politics. It suggests that externally the AKP’s economic and social policies are driven by the interests of its two major constituencies (namely, lower-class voters and “Anatolian capital”), while internally they are shaped by two camps of policy makers (namely, neoliberal-minded technocrats and election-focused party leaders).

Cost-Sharing Rates Increase During Deep Recession: Preliminary Data From Greece.

Background: Measures taken over the past four years in Greece to reduce pharmaceutical expenditure have led to significant price reductions for medicines, but have also changed patient cost-sharing rates for prescription drugs. This study attempts to capture the resulting increase in patients’ out-of-pocket (OOP) expenses for prescription drugs during the 2011-2014 period. Methods: The authors conducted a retrospective review of financial data derived from 39 883 prescriptions, dispensed at three randomly chosen pharmacies located in Lamia, central Greece. Results: The study recorded an average contribution rate per prescription as follows: 11.28% for 2011 (95% CI: 10.76-11.80), 14.10% for 2012, 19.97% for 2013, and 29.08% for 2014. Correspondingly, the mean patient charge per prescription for 2011 was €6.58 (95% CI: 6.22-6.94), €8.28 for 2012, €8.35 for 2013, and €10.87 for 2014. During the 2011-2014 period, mean percentage rate of patient contribution increased by 157.75%, while average patient charge per prescription in current prices increased by 65.22%. The use of a newly introduced internal reference price (IRP) system increased the level of prescription charge at a rate of 2.41% for 2012 (100% surcharge on patients), 26.24% for 2013 (49.95% on patients and 50.04% on the appropriate health insurance funds), and 47.72% for 2014 (85.06% on patients and 14.94% on funds). Conclusion: Increased cost-sharing rates for prescription drugs can reduce public pharmaceutical expenditure, but international experience shows that rising OOP expenses can compromise patients’ ability to pay, particularly when it comes to chronic diseases and vulnerable populations. Various suggestions could be effective in refining the cost-sharing approach by giving greater consideration to chronic patients, and to the poor and elderly.

Highly innovative drugs in the Czech Republic: retrospective analysis of impact on early market entry, regular reimbursement system entry and public pharmaceutical expenditure

Objectives This study aims to describe a specific system of reimbursement of highly innovative drugs (HID) in the Czech Republic, representing a time-limited reimbursement under special conditions. The second objective is to evaluate the total number of drugs approved as HID, as well as the number of drugs entering or failing to enter the system of regular reimbursement. The third objective is to describe the development of costs and impact of HID on the overall public pharmaceutical expenditures.

Estimating the Fiscal Effects of Public Pharmaceutical Expenditure Reduction in Greece

The purpose of the present study is to estimate the impact of pharmaceutical spending reduction on public revenue, based on data from the national health accounts as well as on reports of Greece’s organizations. The methodology of the analysis is structured in two basic parts. The first part presents the urgency for rapid cutbacks on public pharmaceutical costs due to the financial crisis and provides a conceptual framework for the contribution of the Greek pharmaceutical branch to the country’s economy. In the second part, we perform a quantitative analysis for the estimation of multiplier effects of public pharmaceutical expenditure reduction on main revenue sources, such as taxes and social contributions. We also fit projection models with multipliers as regressands for the evaluation of the efficiency of the particular fiscal measure in the short run. According to the results, nearly half of the gains from the measure’s application is offset by financially equivalent decreases in the government’s revenue, i.e., losses in tax revenues and social security contributions alone, not considering any other direct or indirect costs. The findings of multipliers’ high value and increasing short-term trend imply the measure’s inefficiency henceforward and signal the risk of vicious circles that will provoke the economy’s deprivation of useful resources.

PHP77 - Current estimates of the Public Pharmaceutical expenditure in Mongolia

PHP77 - Current estimates of the Public Pharmaceutical expenditure in Mongolia