IHS Global Insight Perspective | |
Significance | A new price schedule introduced today includes changes to the prices of 262 drugs, and details of 4 new originator drugs to be reimbursed. The Greek government is also stepping up efforts to recoup funds owed by pharmaceutical companies under the 4% "tax" on reimbursed drug sales over the past few years. |
Implications | The 262 changes to drug prices are the first stage in a series of amendments that should see the prices of 6,000 drugs reassessed by February 2010. The Greek government is demonstrating its commitment to cost containment with this measure, as well as its statement of intent to recoup debts from pharma companies incurred under the 4% "tax" on reimbursed drug sales. |
Outlook | This is a mixed result for pharmaceutical companies in Greece: reimbursement is being provided for new drugs, while the country's government states its determination to make the industry pay the debts it owes under the 4% "tax" on reimbursed drugs. With the present turmoil in the Greek economy, it can be expected that the country's new government will seek to contain costs more efficiently, and pharmaceutical companies operating in the country will inevitably be affected by this. |
Greece's economy minister Louka Katseli has signed a new price schedule for pharmaceuticals subject to reimbursement in Greece, which comes into effect today, reports Greek news website in.gr. The new schedule includes changes to the prices of 262 drugs, of which 197 are generics and 63 are originator drugs. There are also four completely new innovative drugs included on the reimbursement list, and two biosimilars.
The new price schedule affects drugs for particular therapeutic areas, including allergies, Parkinson's Disease, diabetes, and cancers. As part of the changes introduced today, the prices of the drugs involved in the current schedule have been amended in line with the recently introduced changes to the methodology of setting prices for originator drugs, generics, and biosimilars. This involves the price of drugs in Greece being set at the average price of the three lowest-priced markets in the European Union. This applies to generics as well, although they are also subject to pricing at a maximum of 80% of the price of the original (see Greece: 20 November 2009: Measures to Be Introduced to Reduce Drug Reimbursement Spending in Greece, Savings of US$2.2 bil. Planned).
Four New Originator Drugs Receive Reimbursement
New Originator Drugs Reimbursed in Greece from 14 December | ||
Branded Drug/API | Producer | Indication |
Mozobil (plerixafor injection) | Genzyme (U.S.) | Non-Hodgkin's lymphoma and multiple myeloma |
Iressa (gefitinib) | AstraZeneca (U.K.) | Advanced or metastatic non-small cell lung cancer |
Beriplex P/N (human prothrombin complex concentrate) | CSL Behring (Australia) | Emergency reversal of anti-coagulation |
Onglyza (saxagliptin) | AstraZeneca and Bristol-Myers Squibb (U.S.) | Type 2 diabetes |
Source: in.gr | ||
Government Seeks to Recoup Funds from Pharmaceutical Companies Under 4% "Tax" on Reimbursed Medicines
Meanwhile, the Greek ministry of labour and social security has announced its determination to recoup debts owed to health-insurance funds, including payments from pharmaceutical companies under the system whereby 4% of the sales of reimbursed drugs in Greece is returned to the insurance funds, reports Greek news provider Express.gr. According to the source, for the years 2006–08, pharmaceutical companies owe as much as 350.63 million euro (US$512.72 million) under this "tax", although they have only paid 14 million euro. Around 200 pharmaceutical companies are implicated in the non-payment. Among these 200 are 15 companies that are reported to owe as much as 200 million euro between them.
Express.gr reports that one of the effects of the non-payment is that pharmacies are under threat of bankruptcy in the Attica region, due to the debts owed to pharmacies from the health insurance funds, which amount to an estimated 136 million euro. Meanwhile, pharmaceutical companies operating in Greece argue that the tax is unconstitutional, and that it constitutes unfavourable discrimination against them, and their freedom of operation. They also point out the fact that neither wholesalers nor pharmacies are implicated under the tax, which they argue is unjust.
Outlook and Implications
The Greek economy ministry is due to reassess the prices of around 6,000 reimbursed medicines by February 2010, and therefore this first round of 262 price amendments represents only a small number of the total. Although there is certainly an increase in the intensity of the pharmaceutical cost-containment activity of the Greek government, the addition of a number of new innovative treatments to the list of reimbursed drugs in the country is slightly at odds with this trend.
Meanwhile, the announcement that the Ministry of Labour and Social Security is planning to chase up debts of pharmaceutical companies stretching back several years—incurred under the 4% "tax" on the sales of reimbursed drugs—is another indication of the new Greek government's determination to tighten up the country's finances, which is to be seen in the light of the recent reports of economic turmoil in the country. However, there will be questions concerning how the debts were permitted to be left unpaid for so long, and there is a sense that they are being pursued now, only when the economic situation has deteriorated sufficiently for them to be seen as essential. Whatever the outcome of this situation, it is highly likely that the future for pharmaceutical companies operating in Greece will be less favourable than it has been in recent years, which have seen very dynamic growth on the market.