Reimbursability of 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 medicines in the reimbursement system are mainly prescription-only products, with the exception of certain self-care medicines prescribed by the physician. About 60% of all medicines available in the pharmacies are reimbursable.
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 for the basic reimbursement status and wholesale price, the pharmaceutical company gives the arguments about the usefulness of the medicine. The company also provides PPB with other information and reports, for example, on the medicine costs and benefits as well as on expected sales.
The cost-effectiveness of a product containing a new pharmaceutical substance must be shown through a pharmacoeconomic report.
Procedure leading to basic reimbursement decision
PPB first decides on the reimbursability of the medicine for the indications listed in the marketing authorisation document, and then adopts the reimbursable wholesale price. PPB also considers the therapeutic value of the pharmaceutical.
In its decision-making, PPB compares the cost of the pharmacotherapy with the benefits it provides. The comparisons normally focus on other medicines and therapy options used for the same disease, as well as on the international price level of the product. PPB also considers the funds available for reimbursements in the health insurance system.
PPB will request an opinion from Kela and, if necessary, from its own expert group. Kela plays an important role in evaluating the pharmacoeconomic reports on new medicines. Having received the expert opinions, PPB makes an independent decision.
The reimbursements can be obtained only on medicines used for the treatment of diseases or alleviation of symptoms. PPB can also limit the basic reimbursement status to 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 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 law does not provide exact evaluation criteria concerning the reimbursability and wholesale price questions, and therefore PPB has extensive discretion in its decision-making.
Reimbursement status can be cancelled
PPB can also cancel the reimbursement status of a medicine if the patent on the product expires or a cheaper generic product with the same active ingredient enters the reimbursement system. The reimbursability can also be cancelled if the sales of the product significantly exceed the anticipated volumes.
The pharmaceutical company can withdraw the product from the reimbursement system by notifying PPB.
Application procedure related to special reimbursement status
The basic reimbursement for a medicine is 42% while the special reimbursement is 72% or 100% of the price. As a rule, the new product must remain in the basic reimbursement category for two years before the potential special reimbursement status can be evaluated.
The criteria applied to basic reimbursability largely also pertain to special reimbursement applications and the relevant limitations and cancellations.
Before deciding, PPB will consider the nature of the disease, the necessity, cost-effectiveness and therapeutic value of the product, as well as the funds available each year to pay for the special reimbursements (8.4 million euro annually for the past few years).
PPB also decides on 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 PPB process is often clearly more rapid for generic medicines if their price level is at least 40% lower than the adopted wholesale price of the 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 remains in force for a maximum of five years, or three years in the case of novel pharmaceutical substances. In practice, the decisions remain in force for one to two years, or for a shorter period.
The pharmaceutical company must apply for renewals of the reimbursement status and wholesale price decision before it expires. PPB decides on the renewals using the same criteria applied to new medicines.
An exception to the temporary nature of the decision is constituted by the products in the reference price system, with the reimbursement status remaining in force as long as the product belongs uninterruptedly to a reference price group.
PIF’s operative focuses in 2011
PIF develops the medicine cost-effectiveness appraisals in collaboration with PPB so that the companies would get their new medicines in the reimbursement system and accessible to the patients more rapidly.
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