The Greek association of innovative pharmaceutical companies, the SFEE, is expecting to be consulted on the details of the hospital-drug claw-back system, while it has voiced a number of concerns over the system's workability.
IHS Life Sciences perspective | |
Implications | The lack of adequate monitoring and control systems for pharmaceutical spending in many Greek hospitals is a particular concern for the SFEE. |
Outlook | It is unlikely that the SFEE will accept the system as it is currently proposed, and submitted to Parliament for the first time; unless changes are made, the association will likely pursue appeals in Greece and at the EU level. |
The pharmaceutical claw-back system for hospitals in Greece – agreed as part of the negotiations between the Greek government and its bailout lenders in November, as part of the terms of the second tranche of funds in the country's current rescue package – was submitted to the Greek parliament on Saturday 13 December, comprising Article 41 in the finance ministry's draft bill relating to the provisions of the bailout, reports Greek healthcare-news provider Iatronet. As the source reports, a claw-back system already exists in the case of the pharmaceutical expenditure of the Greek National Organisation for Healthcare Provision (EOPYY), relating to reimbursed medicines available from community pharmacies; if the actual expenditure of the EOPYY in this area exceeds the budgeted amount, the excess must be paid by pharmaceutical companies. The hospital-drug claw-back system is set to apply only in 2016–18, as part of the bailout agreement for those years.
Drat bill includes budget for hospital drugs in 2016–18, including those supplied via EOPYY-affiliated pharmacies
In the submitted regulation, it is stated that the budget for hospital medicines – which is set to become the threshold for claw-back – is EUR570 million (USD625.9 million) for 2016, of which EUR510 million is allocated to medicines in hospitals, and EUR60 million to hospital drugs made available through EOPYY-affiliated pharmacies, reports Iatronet, specifying that the hospital drugs available through EOPYY-affiliated pharmacies include cancer medicines, and medicines for patients with chronic diseases.
In 2017, the hospital-drug budget/claw-back threshold is set at EUR550 million in the drafted bill, which breaks down to EUR492.1 million for medicines in hospitals and EUR57.9 million for hospital medicines available in EOPYY-affiliated pharmacies, reports Iatronet. For 2018, the planned budget is EUR530 million, breaking down to EUR474.2 million for medicines in hospitals, and EUR55.8 million for hospital drugs in pharmacies.
Pharmaceutical industry expects to be consulted
Greek medical news source Onmed reports that the leadership of the Greek ministry of health (MoH) has promised that the pharmaceutical industry will be able to submit their views on the draft bill. The source reports that the president of the Hellenic Association of Pharmaceutical Companies (SFEE, which represents multinational innovative pharmaceutical companies in Greece), Paschalis Apostolidis, has stated that although the SFEE may accept that it will not be possible to avoid claw-back for hospital drugs, it requests at the least an option to participate in the formulation of some of the key aspects of the system. The source reports that these consultations are expected to take place during this week (starting on Monday 14 December).
Concerns over workability of hospital-drug claw-back system
Onmed reports that the hospital claw-back system was not proposed by the country's bailout creditors, but by the Greek authorities. Onmed also reports some of the concerns expressed by the SFEE relating to the hospital-drug claw-back system, including the lack of an electronic interface to enable the control and monitor orders of, and expenditure on hospital drugs in all but 15 hospitals. Additionally, there are no tenders for medicines at a central level conducted by the National Health Service (ESY), a system which could enable significant savings, suggests Onmed.
The SFEE is also reported by the source as having questioned the criteria used to determine the amount of the hospital budget in 2016 – EUR570 million – in the context of the fact that in 2015, the budget for hospital medicines has been reported at EUR710 million. The SFEE also reportedly raised the issue of expected increases in hospital admissions in 2016, together with the additional concern that there are no precedents of claw-back systems being introduced for hospital drugs in other countries.
Onmed also reports that the president of the Hellenic-American Chamber of Commerce, Simos Anastassopoulos, has voiced concerns over the proposed claw-back system, stating that it will also have a detrimental effect on investment in Greece.
Outlook and implications
The SFEE has already announced its willingness to make appeals against the new hospital-drug claw-back system, both in Greece and at a European level (see Greece: 4 December 2015: Greece's innovative pharma association set to appeal to Council of State against introduction of claw-back for hospital drugs). It is possible that the apparent willingness of the Greek MoH to consult the industry on the new claw-back system may stall the SFEE's appeals, with the association potentially able to bring about changes to the system that could result in the planned appeals being dropped; however, it is unlikely that the Greek government will make substantial concessions with regard to the savings it would hope to incur from the system's implementation.
However, the concerns of the SFEE over the workability of the system are justified. With many Greek hospitals inadequately equipped to monitor and control hospital-drug spending, and tenders at the ESY-level non-existent, it is difficult for hospitals to maintain a high degree of vigilance with regard to maintaining drug spending within defined targets. The situation is rendered more challenging still by the fact that many Greek hospitals are enormously indebted, with long payment delays to suppliers.
There is an inescapable sense that the pharmaceutical industry – in particular the innovative pharmaceutical industry – is being expected to provide the cost containment which the Greek authorities themselves are unable to do. The EOPYY estimates that for 2015, the amount which the pharmaceutical industry will be required to pay in claw-back (community pharmacies) and mandatory discounts will amount to EUR644 million, out of a pharmaceutical reimbursement budget of around EUR2 billion. The addition of the hospital-drug claw-back system will render the level of payment unworkable, unless a compromise is reached.