AMNOG Arbitral Awards: Analysis of the Decisions of the Arbitration Board Ten Years after AMNOG Implementation

Aim The analysis investigates the arbitral awards of the last ten years with regards to the characteristics of pharmaceuticals, contractual details and decisions of the arbitration board. Method Arbitral awards until end of 2020 were considered for the analysis. Data were gathered from the arbitral awards, the corresponding G-BA resolutions and the Lauer-Taxe. Results Nearly 50 % of the arbitral awards were based on an additional benefit. Besides the reimbursement price the duration of the contract, sales volume and redemption of the manufacturer’s discount were most commonly set by the arbitration board. Rebates set by the arbitration board seem to be higher than overall AMNOG rebates and appear to vary depending on the extent of the additional benefit. Conclusion While the arbitral awards show a strong variability and individuality a few patterns can be identified.

Common Pharmaceutical Price and Cost Controls in the United Kingdom, France, and Germany: Lessons for the United States

To identify pharmaceutical spending-control options for the United States, we analyzed the policies of the United Kingdom, France, and Germany, which encourage drugmakers to undertake innovations that improve health while controlling spending. Their main strategies today include: using legislation to set default rules that increase the insurer's bargaining position, employing health technology assessment that measures cost-effectiveness or comparative effectiveness and caps the purchase or reimbursement price, setting a single maximum price for similar drugs (reference group pricing), capping prices near prices in other European countries (external reference pricing), prohibiting price increases, contracting to obtain discounts as sales volume rises, procuring drugs through competitive bids, and requiring manufacturers to pay rebates when spending exceeds a global budget. Each strategy addresses a distinct cause of high spending and supports overall goals. Most recent US reform proposals recommend incremental changes that would not address the major sources of high and increasing pharmaceutical prices. However, some US reform proposals resemble certain European strategies and could bring more significant change. US policymakers should consider adopting each of the strategies employed in these countries.

On the Effect of Parallel Trade on Manufacturers' and Retailers' Profits in the Pharmaceutical Sector

Differences in regulated pharmaceutical prices within the European Economic Area create arbitrage opportunities that pharmacy retailers can access through parallel imports. For prescription drugs under patent, parallel trade affects the sharing of profits among an innovating pharmaceutical company, retailers, and parallel traders. We develop a structural model of demand and supply in which retailers can choose the set of goods to sell, thus foreclosing consumers' access to less profitable drugs. This allows retailers to bargain and obtain lower wholesale prices from the manufacturer and parallel trader. With detailed transaction data from Norway, we identify a demand model with unobserved choice sets using retail‐side conditions for optimal assortment decisions of pharmacies. We find that retailer incentives play a significant role in fostering parallel trade penetration and that banning parallel imports would benefit manufacturers as well as prevent pharmacies from foreclosing the manufacturer's product. Finally, in the case of the statin market in Norway, we show that it would be possible to decrease spending and increase profits of the original manufacturer through lump sum transfers associated with a lower reimbursement price, thus decreasing price differentiation across countries.

PP21 High Risk Class Medical Devices Evaluation In Germany: Another Arzneimittelmarkt-Neuordnungsgesetz?

IntroductionIn 2011 the Arzneimittelmarkt-Neuordnungsgesetz (AMNOG) evaluation process for new drugs was implemented in Germany. Since then, the evidence requirements follow high standards and results impact reimbursement price negotiations. More recently, in 2016, a legal norm (§137h SGBV) to evaluate new treatment and diagnostic methods (MDs) of high risk classes by the Federal Joint Committee (G-BA) was introduced. The requirements, involved stakeholders, timing and results for both processes are outlined and compared.MethodsMethodological guidelines from G-BA and Institute for Quality and Efficiency in Health Care (IQWiG), consultations and evaluations for MDs according to §137h and for drugs according to AMNOG were reviewed and compared. Published assessment results were analyzed according the decision criteria and impact on price negotiations with Statutory Health Insurance.ResultsHospitals need to submit jointly with the manufacturer comparative evidence on clinical efficacy, safety and cost when applying for additional compensation (Neue Untersuchungs- und Behandlungsmethoden [NUB] application) for new high risk class MDs being subject to §137h. A fast track assessment by IQWiG/G-BA follows within four months resulting in benefit proven, potential benefit or no benefit compared to alternatives. The latter can lead to exclusion from reimbursement. Until now one MD was granted a benefit, two treatments were assigned a potential benefit and six MDs no benefit, while 55 percent of drugs evaluated under AMNOG were granted an additional benefit. Compared to drugs, the required evidence for MDs is similar. Whereas assessment time is shorter, manufacturers can seek advice from G-BA upfront for free and need to collaborate closely with hospitals.ConclusionsHalf of MDs examined did not qualify for an assessment under §137h. Unlike for drugs evaluated under AMNOG, the majority of new MDs failed to be granted potential benefit as a treatment alternative and might be excluded from reimbursement. Manufacturers are challenged to generate high quality, comparative evidence within their studies.