Drugmakers face more than 2 billion euros ($2.76 billion) in price cuts in Germany as lawmakers prepare to approve the country’s first controls on the cost of innovative medicines.
The law, to be voted on in Berlin today, gives companies a one-year window to negotiate prices with insurers after introducing new drugs, potentially affecting Novartis AG’s multiple sclerosis treatment Gilenya and AstraZeneca Plc’s blood thinner Brilinta among other medicines that haven’t been approved yet in Europe. If no agreement is reached, the Health Ministry would set a maximum price, and the drugs would undergo a cost-benefit analysis by a semi-state agency.
The deals that drugmakers strike with German insurers may put pressure on sales elsewhere, because other countries use German prices as a reference, said Elmar Kraus, a Frankfurt- based analyst for DZ Bank AG. Today’s curbs come on top of temporary rebates and price freezes on drugs that the government imposed last summer. Those measures will cost drugmakers 2.7 billion euros next year, according to the VFA, a Berlin-based group representing 45 drug producers.
“Everyone is trying to save,” Kraus said in an interview yesterday. “Some are waiting for the Germans. German drug prices have a certain reference function for a range of other countries.”
Companies now generally can set prices for medicines that offer an additional benefit for patients over similar treatments or lower-priced generics.
Thursday, November 11, 2010
Drugmakers May Face More German Price Pressures Under New Law - Bloomberg
via bloomberg.com
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