IHS Global Insight Perspective | |
Significance | A significant number of pharmaceutical companies are reported to have disputed the prices allocated to some of their drugs on the recently published pricing bulletin. Meanwhile, a list has been revealed of 89 expensive hospital drugs that are going to be made available in pharmacies as a cost-containment move. Pharmacists are up in arms at the pricing policy, which they blame for shortages of medicines on their shelves, and some are refusing to comply with the new initiative on expensive medicines. |
Implications | The fallout from the repricing of the drugs that account for the vast majority of pharmaceutical expenditure in Greece continues, formalised with the publication of the new price bulletin on 6 September. |
Outlook | It is likely that the smooth implementation of the new pricing schedule will continue to be met with several significant obstacles; these will come in the form of pharmaceutical companies disagreeing with prices of particular drugs, and pharmacists—who are increasingly under pressure due to lack of payments from insurance funds—running out of patience with the government's policies. |
Around 50 Companies Appeal Against Repricing
Around 50 pharmaceutical companies of the 200-strong total operating in Greece have expressed objections to the repricing of their drugs as part of the price bulletin published on 6 September, according to the Greek ministry of economy, competitiveness and shipping, quoted by Scrip. The source reports that a number of companies have questioned the accuracy of the pricing data, and they are reported to be concerned over the potential impact of the new prices on prices in other European Union (EU) countries, with regard to international reference pricing.
The ministry of economy, competitiveness, and shipping has not revealed which products' repricing the companies had objected to, although it is quoted by Scrip as saying that companies have appealed in the case of a maximum of five drugs per company. However, this does not tally with earlier information on the numbers of objections to new prices expressed by Novartis (Switzerland) and GlaxoSmithKline (GSK, U.K.). The source reports that the ministry has a group working to identify whether errors in prices originated with itself or with the companies involved, and the results of its work are due to be revealed by the end of September. However, there is a feeling within the industry that the pricing methodology used by the ministry is not as watertight as it is being presented.
List Revealed of High-Cost Drugs to Be Made Available in Pharmacies
Meanwhile, a list has been revealed of 89 highly expensive drugs that have up to now only been available in hospitals, but will now be available from pharmacies. This is in connection with a ruling made earlier in the summer, which also involves a 10.41% cut to the price patients pay for these drugs when bought in pharmacies (see Greece: 17 August 2010: Further Drug Cost-Containment Measures Announced in Greece As Treatments for Serious Diseases Face 10.41% Cut). This cut is achieved by pharmaceutical wholesalers reducing their margins from 7.7% to 2.5%, and by pharmacies reducing their margins from 35% to 18%, according to Greek newspaper Ethnos. The same source reports that the decision to make these drugs available in pharmacies is driven by cost-containment concerns, because when they are sold in pharmacies, they will be subject to electronic prescription monitoring. The list includes many of the most expensive, innovative drugs available on the market, including oncology drugs such as U.S. firm Celgene's multiple myeloma drug Revlimid (lenalidomide) and Swiss pharma Roche's oncology drug Avastin (bevacizumab), as well as many other highly expensive biological medicines. The full list can be accessed here, in PDF form, from the website of the Panhellenic Pharmacists' Association.
Pharmacies Report Drug Shortages, Refuse to Comply with Sale of High-Cost Hospital Drugs
Additionally, Greek pharmacists are reporting increasing absences of products from their shelves, and are blaming parallel exports for this phenomenon, reports Greek newspaper To Vima. Among the drugs for which shortages are being reported are U.S. firm Pfizer's drugs Viagra (sildenafil), used to treat erectile dysfunction, and Aricept (donepezil HCl), used in the treatment of Alzheimer's disease, as well as U.K. pharma AstraZeneca's bipolar disorder and depression drug Seroquel (quetiapine fumarate).The source reports that pharmacists are blaming the pricing policies of the government for creating this situation, as well as the National Organisation for Medicines for failing to control the market, in spite of promises to do so. As a result, reports To Vima, some pharmacies are refusing to comply with the sale of the 89 highly expensive medicines, in the context of the major delays in payments from insurance funds for reimbursed drugs.
Outlook and Implications
The level of turmoil on the Greek pharmaceutical market is rising, as the impact of the latest round of major upheavals starts to be felt across the sector. Although the Greek government is presenting a positive slant on the progress of drug repricing, the fact that around 50 companies are appealing against the repricing of certain drugs indicates that the fallout from this process will last longer, and will delay the proper implementation of the new price bulletin and impede the achievement of the savings of around 1.2 billion euro (US$1.57 billion) for which the Greek government is aiming (see Greece: 8 September 2010: Greek Drug-Price Reduction Progresses As Electronic Prescription System Starts to Yield Results).
The Greek government is hoping to make additional savings from making the 89 expensive drugs available in pharmacies, because this will enable it to monitor the sales of these drugs by means of the electronic prescription system that is being implemented across Greece. Presumably this is in response to abuses and malpractices that have occurred within hospitals regarding the purchasing and distribution of these drugs. It is likely that there will be a system in place by which patients will have help administering the drugs—many of which are intravenously administered—otherwise there would be some major safety issues, considering the toxicity of many of them.
At the same time, the fact that some pharmacies are not complying with this plan because of their difficult financial situations—caused by late payments from insurance funds—complicates the picture even more (see Greece: 14 September 2010: Pharmacies Threatened with Closure Due to Unpaid Debts As Severe Shortages of Medicines Reported in Greece). The level of discontent among pharmacists is rising, and it is hard to see how the government will regain their goodwill without a quick resolution to their financial grievances.