Medicine reimbursement

Reimbursements paid by the Social Insurance Institution Kela on medicines

A pharmaceutical company can make a new medicine accessible to patients as soon as the product has the marketing authorisation. The patient can receive reimbursement from the Social Insurance Institution Kela only after the medicine has an adopted basic or special reimbursement status and a wholesale price. The reimbursement can be given to the patient directly by the pharmacy.

The medicines in the reimbursement system are mainly prescription-only products,  with the exception of self-care medicines prescribed by the doctor and basic creams prescribed for skin diseases.  About 60% of all medicines available in the pharmacies are reimbursable.

Medicine reimbursement categories

 

Process for approval of basic reimbursement status for medicine at PPB

The basic reimbursement rate is 40 percent. The pharmaceutical company files an application for the basic reimbursement status and wholesale price of the medicinal product, addressing it to Pharmaceuticals Pricing Board PPB which operates under the Ministry of Social Affairs and Health.

In its application, the pharmaceutical company gives reasons why the medicine in question is needed. It also submits other reports, for example, on the benefits and drawbacks of the medicine as well as on its expected sales volumes. The cost-effectiveness of a medicinal product containing a new pharmaceutical substance and of a new significant indication must be shown through a health economic report.

When deciding on the basic reimbursement status and wholesale price, PPB focuses on

  • the therapeutic value of the medicine
  • the costs of the pharmacotherapy compared with its benefits – the comparisons are normally made with the other medicines used for the same diseases as well as other therapy options and the international price level of the medicinal product
  • the funds available for reimbursements in the health insurance system
  • opinions issued by the PPB expert group and Kela which plays a significant role for the evaluation of the health economic reports

Having received the expert opinions, PPB makes an independent decision. The criteria contained in the law for the evaluation of the reimbursement status and wholesale price are fairly broad.   For this reason, PPB has wide discretionary powers in its decision-making.

Application procedure related to special reimbursement status

The special reimbursements payable on medicines are 65 or 100 percent. The criterion for the entry into the special reimbursement category is that there is sufficient user experience and research data on the therapeutic value and usefulness of the medicine in comparison to other therapy options.

The application procedure, limitations and cancellation of the special reimbursement status are largely the same as those applied to the basic reimbursement status. The PPB decisions are made considering

  • the nature of the disease
  • the need for the medicine as well as its economic and therapeutic value
  • the funds available for new special reimbursements – 8.4 million euro annually for many years.

Reimbursability limitations

The reimbursement status can only be granted to a medicine indicated for the treatment of a disease or the alleviation of symptoms.

PPB can also limit the basic reimbursement status to only apply to a particular disease form, patient group or degree of severity of the disease. Some diseases entitle patients to have limited reimbursement only.

The reimbursement status can also be granted on a conditional basis if the pharmaceutical company and PPB so agree. The relevant conditions may include an agreement on further evidence provided by the company or on financial credits payable to Kela.

Reimbursement status can be denied or cancelled

The medicine will remain excluded from the reimbursement system if PPB does not adopt a reimbursement status or the wholesale price applied for by the company. The company can also decide not to apply for a reimbursement status.

PPB can also cancel the reimbursability status of a medicine if, for example,

  • the patent of the medicinal product expires
  • a less expensive generic medicine with the same active ingredient or a biosimilar of a biological medicine enters the reimbursement system
  • if the sales of the medicine significantly exceed the anticipated volumes.

The pharmaceutical company can withdraw the medicine from the reimbursement system by notifying PPB.

PPB also decides on the duration of reimbursability

PPB evaluates the application for a new medicine, issuing the decision on its reimbursable status and wholesale price within six months. The decision is often made much more rapidly in case of generics with the price set at maximum 50% of the adopted wholesale price of the original medicine.  The price of biosimilars, or the biological medicines developed to be similar to the biological original medicines, may not exceed 70% of the adopted wholesale price of the original innovative medicine.

PPB decisions are appealable, and a dismissed application can be repeated.  In particular, novel pharmaceutical substances may call for several applications.

The decision will remain in force for the maximum of five years The decisions related to novel pharmaceutical substances will be in force for the maximum of three years but, in practice, the factual time is one to two years, or even shorter than that.

The pharmaceutical company must apply for a renewal of the reimbursement status and wholesale price decision before they expire. PPB decides on the renewals using the same criteria applied to new medicines.

The temporary validity decisions do not apply to medicines included in the reference price system. They will remain reimbursable as long as the medicine is included, without interruption, in a particular reference price group.

Additional information: 

Medicine prices
Ministry of Social Affairs and Health
Pharmaceutical Pricing Board PPB 
The Social Insurance Institution of Finland
Finnish Medicines Agency Fimea