Partners Boehringer Ingelheim and Eli Lilly have opted to not launch their oral type-2 diabetes treatment Trajenta (linagliptin) in Germany after its second rejection by the G-BA, which has also recently announced that insulin analogues and human insulins will be placed together in three reference-pricing groups, giving rise to concerns about the situation on the diabetes care market in the country.
IHS Global Insight perspective | |
Significance | Boehringer Ingelheim and Eli Lilly will not launch their oral type-2 diabetes drug Trajenta in Germany following the drug's second rejection by the G-BA – which, alongside the G-BA's decision to place insulin analogues and human insulins together in three reference-pricing groups – has given rise to concerns about the situation on the diabetes care market in Germany. |
Implications | In the case of Trajenta, its failure to prove additional benefits and therefore enter into price negotiations comes at the same time as other drugs in its class have been given breathing space before their eventual likely benefit assessment by a legal challenge by Swiss major Novartis. |
Outlook | There is certainly some pressure building from the side of the industry in terms of its response to the decisions made by the G-BA under the AMNOG law, and it can be expected that this is unlikely to diminish in the foreseeable future; however, as to whether this can bring about a change in the legislation which would be beneficial to the industry is debatable. |
Trajenta will not be launched in Germany
Following the decision by Germany's Federal Joint Committee (G-BA) to not grant the Boehringer Ingelheim (Germany)/Eli Lilly (United States) type-2 diabetes drug Trajenta (linagliptin) additional benefit status for a second time, announced on 21 January, the partners issued a press release in which the Germany country manager for Boehringer, Engelbert Gunster, stated that the G-BA's decision was "incomprehensible" to the company, adding that Trajenta was developed in Germany, but that regrettably, it will not be available on the German market. The decision by the partners not to launch Trajenta in Germany is confirmed by Boehringer's chief executive officer (CEO) Dr Andreas Barner, in the German newspaper Die Welt. Barner is quoted as saying that he regrets the decision, which he describes as German patients being made to suffer as a result of a system which enables payors to impose decision against the medical profession.
The joint press release issued by the partners relating to the G-BA's negative decision also states that Trajenta is used by patients in around 40 countries, and is an "integral" part of the treatment of these patients, adding that the regulations used for assessing the additional benefit of drugs in Germany, introduced under the Pharmaceutical Market Restructuring Act (AMNOG), which came into force at the beginning of 2011, led in their current form to a "dead end", which could result in German patients being detached from medical innovation.
DPP-4 class assessment stalled
At the same time, the G-BA is keen to push forward the process of assessing the benefit of the entire dipeptidyl peptidase 4 (DPP-4) inhibitor class – to which Trajenta belongs – as the first drug class to undergo benefit assessments for drugs which were already marketed before the implementation into law of AMNOG. However, at this stage, this process is stalled by an emergency legal appeal made by Novartis (Switzerland), producer of one of the already-marketed DPP-4 inhibitors, Galvus (vildagliptin), and the combination product Eucreas (vildagliptin and metformin; see Germany - Switzerland: 12 February 2013: German court grants Novartis's appeal against post-AMNOG assessment of DPP-4 inhibitors). Thus, while this legal case unfolds, the existing DPP-4 products will be subject to continued reimbursement by the statutory health insurance funds (GKV) while Trajenta is excluded.
Diabetes care market under more pressure from insulin reference-pricing group decision
Another decision by the G-BA which has put the diabetes care market in Germany under pressure lately has been the announcement of the creation of three reference-pricing groups for human and analog insulins (see Germany: 25 February 2013: Germany's G-BA announces creation of three new reference groups for insulins, drawing criticism from producers). Dr Hagen Pfundner, the chairman of Germany's association of research-based pharmaceutical companies (VFA) is reported by Ärzte Zeitung as saying that both the decision not to grant Trajenta additional benefit status and the decision to create the new reference-pricing groups for insulins are "brakes on innovation" and a "disturbing signal for Germany". The source meanwhile highlights the potential impact of the decision on the price of the insulin analogue products currently still protected by patents in countries that reference Germany for international reference pricing.
Outlook and implications
The fact that Boehringer and Lilly have opted not to launch Trajenta in Germany is significant in itself, considering the fact that it is Europe's largest pharmaceutical market, and one of the largest in the world. While Boehringer's CEO has reportedly expressed conviction that the drug's benefits will ultimately be proven, its absence from the German market is a major blow to the partners. Nevertheless, the decision of the G-BA is consistent with its opinion when the drug was initially submitted for assessment, soon after its European approval in August 2011 – which resulted in Boehringer and Lilly making the decision not to launch Trajenta at that stage, in the hope of overcoming the regulatory obstacles (see United States - Germany: 5 September 2011: Boehringer, Eli Lilly Choose Not to Launch Trajenta in Germany).
Trajenta was not given a positive decision in France, either, and so the negative verdict in Germany is not in isolation. Nevertheless, the fact that other DPP-4 inhibitors continue to be subject to the same reimbursement conditions pending the outcome of the legal case brought by Novartis may be interpreted as a little imbalanced, considering the reported benefits of Trajenta in terms of its not being associated with any need for dose adjustments in the case of patients with kidney disease, in contrast with other DPP-4 inhibitors, while its lowering of HbA1c values are comparable with other DPP-4 inhibitors.
Boehringer's decision not to launch in Germany certainly derives from its keenness to protect Trajenta's price, and not allow any negative impact of a low German price on the price of the drug in countries which use Germany as a reference country in international reference pricing (IRP). The situation regarding insulins is also concerning for the major producers of insulin analogue products – Sanofi (France) and Novo Nordisk (Denmark) – in terms of the downward pressure on their products due to their being placed in the same reference-pricing groups as older, cheaper human insulins.