Developments in Pricing and Reimbursement in Leading Pharma Markets 2010-2020
The global economic crisis and rising healthcare costs have caused governments to take cautious approaches towards pricing and reimbursement (P&R) for pharmaceuticals. Increasing drug prices and rising demand for the latest treatments - driven by aging, expanding populations and improving standards of living - have increased the burden on healthcare systems, public and private. Those events have particularly affected countries whose healthcare is mostly funded by the state. Developing nations are also finding it challenging to meet the increasing expectations for healthcare, despite rapid economic growth. Our new report covers pharma pricing and reimbursement in detail, showing the implications of P&R developments on the pharma industry and market in leading countries.
Worldwide, governments have instigated mechanisms to limit or lower prices of prescription medicines. Those measures include reference pricing, applying cost-benefit analyses and use of other health technology assessments. Those and other P&R policies will continue to exert downward pressure on pharmaceutical pricing from 2010 onwards. As our new report - Developments in Pricing and Reimbursement in Leading Pharma Markets 2010-2020 - shows, there are many opportunities for pharmaceutical companies to increase revenues and be innovative, finding ways to accommodate P&R regulations.
Our new report discusses P&R in the following markets, from 2010 looking ahead:
Comprehensive analysis of pharma pricing and reimbursement in leading markets
Developments in Pricing and Reimbursement in Leading Pharma Markets 2010-2020 examines that sector through a comprehensive review of information sources. We harness both primary and secondary research. This report provides quantitative and qualitative analyses, with discussion of commercial drivers and restraints. There are over 45 tables and figures included, as well as two interviews with experts. The result is a comprehensive market- and industry-centred study, with detailed analyses and informed opinion to benefit your work.
Why you should buy Developments in Pricing and Reimbursement in Leading Pharma Markets 2010-2020
This report gives you the following benefits in particular:
Worldwide, governments have instigated mechanisms to limit or lower prices of prescription medicines. Those measures include reference pricing, applying cost-benefit analyses and use of other health technology assessments. Those and other P&R policies will continue to exert downward pressure on pharmaceutical pricing from 2010 onwards. As our new report - Developments in Pricing and Reimbursement in Leading Pharma Markets 2010-2020 - shows, there are many opportunities for pharmaceutical companies to increase revenues and be innovative, finding ways to accommodate P&R regulations.
Our new report discusses P&R in the following markets, from 2010 looking ahead:
- US
- Japan
- Germany
- France
- UK
- Italy
- Spain.
Comprehensive analysis of pharma pricing and reimbursement in leading markets
Developments in Pricing and Reimbursement in Leading Pharma Markets 2010-2020 examines that sector through a comprehensive review of information sources. We harness both primary and secondary research. This report provides quantitative and qualitative analyses, with discussion of commercial drivers and restraints. There are over 45 tables and figures included, as well as two interviews with experts. The result is a comprehensive market- and industry-centred study, with detailed analyses and informed opinion to benefit your work.
Why you should buy Developments in Pricing and Reimbursement in Leading Pharma Markets 2010-2020
This report gives you the following benefits in particular:
- You will receive a comprehensive analysis of pricing and reimbursement in leading pharmaceutical markets (US, Japan, Germany, France, UK, Italy and Spain)
- You will find out how the pricing and reimbursement landscape will change from 2010 to 2020, with quantitative and qualitative analyses to benefit your work
- You will discover the impact of current US healthcare reform legislation, and similar developments, with implications for pricing and reimbursement of pharmaceuticals in that market discussed
- You will discover the implications of pharma P&R legislation and related developments in the principal European pharma markets, with trends discussed
- You will discover the implications of relevant legislation and related developments in the Japanese pharma market, with trends discussed
- You will receive interviews with experts who discuss current and future trends in the pricing and reimbursement sector.
1. EXECUTIVE SUMMARY
1.1 Overview of Pricing and Reimbursement in 2010
1.2 Aims, Scope and Format of the Report
1.3 Research & Analysis Methods
2. INTRODUCTION TO PRICING AND REIMBURSEMENT: THE INCREASING CONTROL BY GOVERNMENTS
2.1 Price is the Key (I)
2.2 Reimbursement: Who Pays?
2.3 Price is the Key (II)
2.4 The Reimbursement System Described
2.5 Different Reimbursement Systems, Different Drug Prices
2.6 The Different Systems of Reimbursement
2.6.1 International Reference Pricing
2.6.2 Therapeutic Class Reference Pricing
2.6.3 Profit Controls
2.6.4 Doctors' Budgets
2.6.5 Direct Price Controls
2.6.6 Price-Volume Limitations
2.6.7 Rebate Requirements
2.6.8 Reimbursement Restrictions
2.6.9 Fourth Hurdle Requirements/Cost-Effectiveness Reviews
2.6.10 Positive/Negative Lists
2.7 The Influence of Parallel Trade on Drug Pricing
2.8 Marketing Approval is Necessary Prior to Reimbursement
2.9 Pricing Approval Comes After Marketing Approval
2.10 The High Costs of Bringing a Drug to Market
2.11 Drug Purchase Decisions by Doctors Are All-Important in Drug Sales
2.12 The Price Inelasticity of a Doctor’s Decision over Drug Prescription
2.13 Governmental Influence on Doctors' Prescribing Choices Lowers Drug Costs
2.14 Healthcare Costs Throughout the Developed World are Increasing
2.15 Drivers of Drug Expenditure
2.16 Restraints on Drug Expenditure
2.17 In Proportion to its GDP the US Spent the Most on Healthcare
2.18 All Governments Want to Cut Drug Expenditure: Drug Price Control is a Powerful Budgetary Measure
2.19 The Market and Company Factors that Influence Drug Pricing
2.20 OTC Drugs are Not Price Controlled
2.21 Generic Drugs Lower Healthcare Costs
2.22 Increasing Use of Generic Drugs Will Create Savings for Healthcare Systems
2.23 Price Controls May Affect Drug Launches
2.24 Cost Containment Methods have had Limited Effects?
2.25 The Future of Global Pricing and Reimbursement
3. PRICING AND REIMBURSEMENT IN THE US: THE ADVENT OF PRICE CONTROLS?
3.1 An Overview
3.2 US and European Drug Pricing Models Compared
3.3 The US Healthcare System
3.4 Pharmacy Benefit Managers (PBMs): The Middlemen
3.5 The Development of Present-Day Managed Care in the US
3.6 The Cost of Private Health Insurance Premiums
3.7 Private Health Insurance and State Organised Healthcare
3.8 The US Managed Healthcare System
3.9 What are HMOs?
3.10 PPO Plans
3.11 POS Plans
3.12 Different MCOs Compared
3.13 Employers and the US Healthcare System: The Rise of PPO Health Plans
3.14 Health Insurance Options for the Unemployed: COBRA
3.15 The Uninsured Patient in the US
3.16 Medicaid: Overview
3.17 Medicare: Overview
3.18 Drug Reimbursement, MCOs and Medicare/Medicaid
3.18.1 Medicare/Medicaid
3.18.2 Private Insurers
3.18.3 HMOs
3.19 The US Spends Nearly 14% of its GDP on Healthcare
3.20 Private Insurance Pays for Over 35% of US Healthcare Needs
3.21 In 2008 US Prescription Drug Costs Constituted 10% of Healthcare Spending
3.22 US Healthcare Spending Increased by over 10% in 2008
3.23 US Pricing and Federal Discounts
3.24 US Drug Prices are the Highest in the World
3.25 Prices for the Same Drug Can Vary
3.26 Medicare Prescription Drug Improvement and Modernization Act, 2003
3.27 The Patient Protection and Affordable Care Act of 2010
3.27.1 A Brief Overview
3.27.2 Reforms in the New Insurance Marketplace
3.27.3 Reforms Medicare Advantage (MA)
3.27.4 Reforms Part D Coverage Gap: "Donut Hole" Coverage
3.27.5 Reforms in the Retiree Drug Plans
4. PRICING AND REIMBURSEMENT IN EUROPE: CHANGE IN WHAT WAYS?
4.1 Reference Pricing is a Common P&R Mechanism in Europe
4.2 Reference Pricing Causes Drugs to be Priced Below the Market Level
4.3 Price Differentials in the EU
4.4 Generic Prescribing and Substitution Varies Throughout Europe
4.5 Generic Use Varies in Europe
4.6 EU Accession Will Encourage Price Differentials and Generic Usage
4.7 A Single European Price for Pharmaceuticals is Unlikely
4.8 European Hospital Drug Prices
4.9 Parallel Trade is Used as a Cost Containment Method
4.10 The Impact of the Euro on Drug Prices
4.11 Different Forms of EU Healthcare Financing
4.12 Single Payer
4.13 Social Insurance – Sickness Funds
4.14 Private Insurance
4.15 The Payment of European Pharmacists
4.16 The Future of Drug Pricing and the Market for Drugs in Europe
5. PRICING AND REIMBURSEMENT IN GERMANY
5.1 An Overview
5.2 The German Pharmaceutical Market in 2010
5.3 German Healthcare System Recovering from Financial Shortfall
5.4 The German Response to its Healthcare System Shortfall
5.5 The Effect of Reunification on the German National Health System
5.6 Germany has Fastest Drug Approvals Process in Europe
5.7 German Drug Prices are Higher than the European Average
5.8 The German Reference Price System Now Includes Patented Drugs
5.9 Reference Pricing
5.10 Criteria for Reimbursement and Negative Lists
5.11 The Limits on Co-Pay
5.12 Germany Endorses Generic Substitution
5.13 Budgets Imposed on Doctors in an Attempt to Cut Drug Costs
5.14 Healthcare Reform in 2007
5.15 Compulsory Health Insurance for Everyone Living in Germany
5.16 German Pricing and Reimbursement Systems Have Become More Strict
6. PRICING AND REIMBURSEMENT IN FRANCE
6.1 An Overview
6.2 The Price of Drugs in France Matches the European Average
6.3 The French Healthcare System
6.4 Healthcare Coverage
6.5 The French Healthcare System
6.6 Voluntary Health Insurance (VHI)
6.7 Out-of-Pocket Payments
6.8 French Drug Pricing is Tightly Regulated
6.9 An Informal Reference Pricing System Exists in France
6.10 Wholesale and Pharmacy Prices
6.11 The Criteria for Reimbursement
6.12 The Size of Reimbursement
6.13 The Nature of the Drug Price Agreements Between the Pharmaceutical Industry and the CEPS
6.14 Generic Substitution as an Attempt to Reduce Drug Costs
6.15 French Health System Reform – How Successful?
7. PRICING AND REIMBURSEMENT IN ITALY
7.1 An Overview
7.2 The Italian Healthcare System
7.3 Drug Reimbursement System
7.4 Authorities for Reimbursement Decision Making
7.5 The AIFE: Setting the Drug Price
7.6 Italian Pharmacies
7.7 Changes in Distribution Margins
7.8 Italian Pharmaceutical Law
7.9 The Introduction of Generics
7.10 The Effect of Drug Pricing Strategies on Italian Drug Spending
7.11 The New System
8. PRICING AND REIMBURSEMENT IN SPAIN
8.1 An Overview
8.2 The Spanish National Health System (SNS)
8.3 Reimbursement Levels
8.4 The Criteria for Reimbursement and Negative Lists
8.5 Drug Authorisations and Other Bodies
8.6 The Pricing of Drugs in Spain
8.7 Reference Pricing System in Spain
8.8 The Penetration of Generics is Low in Spain
8.9 Spanish Parallel Trade and Dual Pricing
8.10 The Price of Drugs in Spain
8.11 Spain Practises Generic Substitution
8.12 The Distribution of Drugs
8.13 Cost Containment and Prescribers’ Budgets
8.14 New "Health Pact" in Spain, 2010
8.15 Spain Uses Price Freezing as a Cost-Saving Procedure
9. PRICING AND REIMBURSEMENT IN THE UK
9.1 An Overview
9.2 Drug Approval Process
9.3 Healthcare Coverage
9.4 Patient Co-Payment
9.5 The Pharmaceutical Price Regulation Scheme
9.6 New PPRS Regulations in 2009
9.7 Pharmaceutical Companies and the Monitoring of Drug Profits
9.8 National Institute of Clinical Effectiveness (NICE) – How Effective in Reducing Drug Costs?
9.9 Pharmacy Payments
9.10 The Criteria for Reimbursement
9.11 The Size of Reimbursement
9.12 Prescribers’ Budgets are Unpopular with Some Doctors But Reduce Drug Expenditure
9.13 Generic Use is Increasing
9.14 Drug Prices Have Been Reduced in the UK Market
9.15 Prescribers’ Budgets – the Most Successful Aspect of UK's Pricing and Reimbursement System?
10. PRICING AND REIMBURSEMENT IN JAPAN
10.1 An Overview
10.2 The Japanese Healthcare System
10.3 Revisions to the Health Insurance Law Caused an Increase in Co-Pay
10.4 Japanese Drug Pricing
10.5 The Japanese Reference System
10.6 The Re-examination and Re-evaluation Drug Systems are Used to Predict Drug Safety
10.7 Japan Has Reduced Healthcare Spending Including that on Drugs
10.8 Generic Drug Prices Are Relatively High
10.9 Japan Promotes Generic Substitution to Reduce Costs
10.10 The Japanese Wholesale Market in Consolidation
10.11 Bungyo: the Separation of Dispensing and Prescribing is Rapidly Increasing
10.12 Bungyo Separation Has Dramatic Effect on Retail Pharmacies
10.13 New Developments: Contract Manufacturing Will Increase
10.14 New Drug Approval and Licensing System Will Cut Drug Approval Time
10.15 Faster Approval Times Will Facilitate Entry into the Japanese Pharmaceutical Market
10.16 The Japanese Government Directly Controls Drug Prices through Price Cuts
11. EXPERT VIEWS ON PRICING AND REIMBURSEMENT
11.1 Dr Sanjay Bajpai, MS, MABA, PhD, President, Institute of Pharmaceutical Management, New York, USA
11.1.1 Key Issues in US Pricing & Reimbursement
11.1.2 The Current State of Affairs in the US
11.1.3 Insurance Coverage and the Uninsured
11.1.4 Key Changes in US Healthcare Reforms
11.1.5 US and the European Healthcare Systems
11.1.6 Generic Medicines
11.2 Dr Cyrus A. Chowdhury, Vice President, Global Market Access, Insight Strategy Advisors, New York, USA
11.2.1 On Emerging Markets
11.2.2 On BRIC Nations and CEE
11.2.3 On Latin America, Middle East and Africa
11.2.4 Factors Affecting Market Development
11.2.5 On Disease Prevalence in Developing Countries
11.2.6 Long Term Success in Emerging Markets
11.2.7 Cost Burden of New Therapeutic Products
12. CONCLUSIONS
12.1 Drug Pricing Controls Will Become More Stringent
12.2 Developments in the US Pharma Market Sector
12.3 Concluding Thoughts
1.1 Overview of Pricing and Reimbursement in 2010
1.2 Aims, Scope and Format of the Report
1.3 Research & Analysis Methods
2. INTRODUCTION TO PRICING AND REIMBURSEMENT: THE INCREASING CONTROL BY GOVERNMENTS
2.1 Price is the Key (I)
2.2 Reimbursement: Who Pays?
2.3 Price is the Key (II)
2.4 The Reimbursement System Described
2.5 Different Reimbursement Systems, Different Drug Prices
2.6 The Different Systems of Reimbursement
2.6.1 International Reference Pricing
2.6.2 Therapeutic Class Reference Pricing
2.6.3 Profit Controls
2.6.4 Doctors' Budgets
2.6.5 Direct Price Controls
2.6.6 Price-Volume Limitations
2.6.7 Rebate Requirements
2.6.8 Reimbursement Restrictions
2.6.9 Fourth Hurdle Requirements/Cost-Effectiveness Reviews
2.6.10 Positive/Negative Lists
2.7 The Influence of Parallel Trade on Drug Pricing
2.8 Marketing Approval is Necessary Prior to Reimbursement
2.9 Pricing Approval Comes After Marketing Approval
2.10 The High Costs of Bringing a Drug to Market
2.11 Drug Purchase Decisions by Doctors Are All-Important in Drug Sales
2.12 The Price Inelasticity of a Doctor’s Decision over Drug Prescription
2.13 Governmental Influence on Doctors' Prescribing Choices Lowers Drug Costs
2.14 Healthcare Costs Throughout the Developed World are Increasing
2.15 Drivers of Drug Expenditure
2.16 Restraints on Drug Expenditure
2.17 In Proportion to its GDP the US Spent the Most on Healthcare
2.18 All Governments Want to Cut Drug Expenditure: Drug Price Control is a Powerful Budgetary Measure
2.19 The Market and Company Factors that Influence Drug Pricing
2.20 OTC Drugs are Not Price Controlled
2.21 Generic Drugs Lower Healthcare Costs
2.22 Increasing Use of Generic Drugs Will Create Savings for Healthcare Systems
2.23 Price Controls May Affect Drug Launches
2.24 Cost Containment Methods have had Limited Effects?
2.25 The Future of Global Pricing and Reimbursement
3. PRICING AND REIMBURSEMENT IN THE US: THE ADVENT OF PRICE CONTROLS?
3.1 An Overview
3.2 US and European Drug Pricing Models Compared
3.3 The US Healthcare System
3.4 Pharmacy Benefit Managers (PBMs): The Middlemen
3.5 The Development of Present-Day Managed Care in the US
3.6 The Cost of Private Health Insurance Premiums
3.7 Private Health Insurance and State Organised Healthcare
3.8 The US Managed Healthcare System
3.9 What are HMOs?
3.10 PPO Plans
3.11 POS Plans
3.12 Different MCOs Compared
3.13 Employers and the US Healthcare System: The Rise of PPO Health Plans
3.14 Health Insurance Options for the Unemployed: COBRA
3.15 The Uninsured Patient in the US
3.16 Medicaid: Overview
3.17 Medicare: Overview
3.18 Drug Reimbursement, MCOs and Medicare/Medicaid
3.18.1 Medicare/Medicaid
3.18.2 Private Insurers
3.18.3 HMOs
3.19 The US Spends Nearly 14% of its GDP on Healthcare
3.20 Private Insurance Pays for Over 35% of US Healthcare Needs
3.21 In 2008 US Prescription Drug Costs Constituted 10% of Healthcare Spending
3.22 US Healthcare Spending Increased by over 10% in 2008
3.23 US Pricing and Federal Discounts
3.24 US Drug Prices are the Highest in the World
3.25 Prices for the Same Drug Can Vary
3.26 Medicare Prescription Drug Improvement and Modernization Act, 2003
3.27 The Patient Protection and Affordable Care Act of 2010
3.27.1 A Brief Overview
3.27.2 Reforms in the New Insurance Marketplace
3.27.3 Reforms Medicare Advantage (MA)
3.27.4 Reforms Part D Coverage Gap: "Donut Hole" Coverage
3.27.5 Reforms in the Retiree Drug Plans
4. PRICING AND REIMBURSEMENT IN EUROPE: CHANGE IN WHAT WAYS?
4.1 Reference Pricing is a Common P&R Mechanism in Europe
4.2 Reference Pricing Causes Drugs to be Priced Below the Market Level
4.3 Price Differentials in the EU
4.4 Generic Prescribing and Substitution Varies Throughout Europe
4.5 Generic Use Varies in Europe
4.6 EU Accession Will Encourage Price Differentials and Generic Usage
4.7 A Single European Price for Pharmaceuticals is Unlikely
4.8 European Hospital Drug Prices
4.9 Parallel Trade is Used as a Cost Containment Method
4.10 The Impact of the Euro on Drug Prices
4.11 Different Forms of EU Healthcare Financing
4.12 Single Payer
4.13 Social Insurance – Sickness Funds
4.14 Private Insurance
4.15 The Payment of European Pharmacists
4.16 The Future of Drug Pricing and the Market for Drugs in Europe
5. PRICING AND REIMBURSEMENT IN GERMANY
5.1 An Overview
5.2 The German Pharmaceutical Market in 2010
5.3 German Healthcare System Recovering from Financial Shortfall
5.4 The German Response to its Healthcare System Shortfall
5.5 The Effect of Reunification on the German National Health System
5.6 Germany has Fastest Drug Approvals Process in Europe
5.7 German Drug Prices are Higher than the European Average
5.8 The German Reference Price System Now Includes Patented Drugs
5.9 Reference Pricing
5.10 Criteria for Reimbursement and Negative Lists
5.11 The Limits on Co-Pay
5.12 Germany Endorses Generic Substitution
5.13 Budgets Imposed on Doctors in an Attempt to Cut Drug Costs
5.14 Healthcare Reform in 2007
5.15 Compulsory Health Insurance for Everyone Living in Germany
5.16 German Pricing and Reimbursement Systems Have Become More Strict
6. PRICING AND REIMBURSEMENT IN FRANCE
6.1 An Overview
6.2 The Price of Drugs in France Matches the European Average
6.3 The French Healthcare System
6.4 Healthcare Coverage
6.5 The French Healthcare System
6.6 Voluntary Health Insurance (VHI)
6.7 Out-of-Pocket Payments
6.8 French Drug Pricing is Tightly Regulated
6.9 An Informal Reference Pricing System Exists in France
6.10 Wholesale and Pharmacy Prices
6.11 The Criteria for Reimbursement
6.12 The Size of Reimbursement
6.13 The Nature of the Drug Price Agreements Between the Pharmaceutical Industry and the CEPS
6.14 Generic Substitution as an Attempt to Reduce Drug Costs
6.15 French Health System Reform – How Successful?
7. PRICING AND REIMBURSEMENT IN ITALY
7.1 An Overview
7.2 The Italian Healthcare System
7.3 Drug Reimbursement System
7.4 Authorities for Reimbursement Decision Making
7.5 The AIFE: Setting the Drug Price
7.6 Italian Pharmacies
7.7 Changes in Distribution Margins
7.8 Italian Pharmaceutical Law
7.9 The Introduction of Generics
7.10 The Effect of Drug Pricing Strategies on Italian Drug Spending
7.11 The New System
8. PRICING AND REIMBURSEMENT IN SPAIN
8.1 An Overview
8.2 The Spanish National Health System (SNS)
8.3 Reimbursement Levels
8.4 The Criteria for Reimbursement and Negative Lists
8.5 Drug Authorisations and Other Bodies
8.6 The Pricing of Drugs in Spain
8.7 Reference Pricing System in Spain
8.8 The Penetration of Generics is Low in Spain
8.9 Spanish Parallel Trade and Dual Pricing
8.10 The Price of Drugs in Spain
8.11 Spain Practises Generic Substitution
8.12 The Distribution of Drugs
8.13 Cost Containment and Prescribers’ Budgets
8.14 New "Health Pact" in Spain, 2010
8.15 Spain Uses Price Freezing as a Cost-Saving Procedure
9. PRICING AND REIMBURSEMENT IN THE UK
9.1 An Overview
9.2 Drug Approval Process
9.3 Healthcare Coverage
9.4 Patient Co-Payment
9.5 The Pharmaceutical Price Regulation Scheme
9.6 New PPRS Regulations in 2009
9.7 Pharmaceutical Companies and the Monitoring of Drug Profits
9.8 National Institute of Clinical Effectiveness (NICE) – How Effective in Reducing Drug Costs?
9.9 Pharmacy Payments
9.10 The Criteria for Reimbursement
9.11 The Size of Reimbursement
9.12 Prescribers’ Budgets are Unpopular with Some Doctors But Reduce Drug Expenditure
9.13 Generic Use is Increasing
9.14 Drug Prices Have Been Reduced in the UK Market
9.15 Prescribers’ Budgets – the Most Successful Aspect of UK's Pricing and Reimbursement System?
10. PRICING AND REIMBURSEMENT IN JAPAN
10.1 An Overview
10.2 The Japanese Healthcare System
10.3 Revisions to the Health Insurance Law Caused an Increase in Co-Pay
10.4 Japanese Drug Pricing
10.5 The Japanese Reference System
10.6 The Re-examination and Re-evaluation Drug Systems are Used to Predict Drug Safety
10.7 Japan Has Reduced Healthcare Spending Including that on Drugs
10.8 Generic Drug Prices Are Relatively High
10.9 Japan Promotes Generic Substitution to Reduce Costs
10.10 The Japanese Wholesale Market in Consolidation
10.11 Bungyo: the Separation of Dispensing and Prescribing is Rapidly Increasing
10.12 Bungyo Separation Has Dramatic Effect on Retail Pharmacies
10.13 New Developments: Contract Manufacturing Will Increase
10.14 New Drug Approval and Licensing System Will Cut Drug Approval Time
10.15 Faster Approval Times Will Facilitate Entry into the Japanese Pharmaceutical Market
10.16 The Japanese Government Directly Controls Drug Prices through Price Cuts
11. EXPERT VIEWS ON PRICING AND REIMBURSEMENT
11.1 Dr Sanjay Bajpai, MS, MABA, PhD, President, Institute of Pharmaceutical Management, New York, USA
11.1.1 Key Issues in US Pricing & Reimbursement
11.1.2 The Current State of Affairs in the US
11.1.3 Insurance Coverage and the Uninsured
11.1.4 Key Changes in US Healthcare Reforms
11.1.5 US and the European Healthcare Systems
11.1.6 Generic Medicines
11.2 Dr Cyrus A. Chowdhury, Vice President, Global Market Access, Insight Strategy Advisors, New York, USA
11.2.1 On Emerging Markets
11.2.2 On BRIC Nations and CEE
11.2.3 On Latin America, Middle East and Africa
11.2.4 Factors Affecting Market Development
11.2.5 On Disease Prevalence in Developing Countries
11.2.6 Long Term Success in Emerging Markets
11.2.7 Cost Burden of New Therapeutic Products
12. CONCLUSIONS
12.1 Drug Pricing Controls Will Become More Stringent
12.2 Developments in the US Pharma Market Sector
12.3 Concluding Thoughts
LIST OF TABLES
Table 2.1 Comparative Drug Prices in Selected Developed Countries, 2010
Table 2.2 Percentage Excess in Drug Prices in the US Compared to Selected Countries, 2003
Table 2.3 Drug Purchase Decision Making, 2010
Table 2.4 Healthcare Spending by Country, 2007
Table 2.5 Total Health Spending and Drug Expenditure per Patient, 2007
Table 2.6 The Top Five Countries by Out-of-Pocket (OOP) Expenditure on Health, 2007
Table 2.7 The Top Five Countries by Total Expenditure on Health, 2007
Table 2.8 The Top Five Countries by Total Expenditure on Drugs as Percentage of Total Expenditure on Health, 2007
Table 2.9 Top Five Countries by Total Health Spending per Capita, 2007
Table 2.10 Factors that Influence Drug Prices, 2010
Table 2.11 Current Practices in the Development of Increased Generic Use, 2010
Table 3.1 Annual Growth in Private Health Insurance Premiums, 1989-2004
Table 3.2 A Comparison in Average Plan Costs Between Several Californian HMOs, 2004
Table 3.3 Monthly Insurance Premiums: Single and Family Enrolled in Group Health Plans, 2004
Table 3.4 US Spending on Healthcare in Comparison with Other Countries, 2007
Table 3.5 Sources of US Healthcare Payments, 2007
Table 3.6 US Healthcare Spending by Category, 2008
Table 3.7 Annual Growth Rates by US Healthcare Spending Categories, 2008
Table 3.8 US Healthcare Spending, 2000-2005
Table 3.9 The Relative Contributions of Price, Usage and Drug Type to Increases in Pharmaceutical Prices, 1997-2002
Table 3.10 A Comparison of Prescription Drug Prices For a 30-day supply: US and Europe, 2010
Table 3.11 Timeline of Key Elements for the PPACA, 2010-2012
Table 3.12 Timeline of Key Elements for the PPACA, 2013-2020
Table 4.1 Price Control or Drug Supply Control Mechanisms as Part of P&R Systems, 2010
Table 4.2 Pricing and Reimbursement Systems of Selected European Countries, 2005
Table 4.3 The Two Broad P&R Systems in Europe, 2010
Table 4.4 EU Countries and Reference Pricing, 2005
Table 4.5 Generic Use in Europe, 2004
Table 4.6 The Advantages and Disadvantages of a Single European Price for All Drugs, 2010
Table 5.1 Aspects of German Healthcare Spending, 2007
Table 5.2 Examples of Drug Reforms in Germany, 2004-2010
Table 6.1 Aspects of French Healthcare Spending, 2009
Table 7.1 Healthcare Statistics for the Italian Market, 2007
Table 7.2 Reimbursement Classes of Drugs in the Italian Market, 2010
Table 8.1 Aspects of Spanish Healthcare Spending, 2007
Table 8.2 Reimbursement Categories in the SNS, 2010
Table 9.1 Aspects of UK Healthcare Spending, 2007
Table 9.2 Pharmaceutical Companies Participating in the PPRS, 2009
Table 9.3 Prescription Charges in the UK, 2010
Table 9.4 People Entitled to Free Prescriptions in UK, 2010
Table 9.5 How a 'QALY' is Calculated by NICE, 2010
Table 9.6 UK Department of Health Classes of Generic Drugs, 2010
Table 10.1 Aspects of Japanese Healthcare Spending, 2007
Table 10.2 Classification and Rate of Japanese Drug Pricing Premiums, 2010
Table 2.1 Comparative Drug Prices in Selected Developed Countries, 2010
Table 2.2 Percentage Excess in Drug Prices in the US Compared to Selected Countries, 2003
Table 2.3 Drug Purchase Decision Making, 2010
Table 2.4 Healthcare Spending by Country, 2007
Table 2.5 Total Health Spending and Drug Expenditure per Patient, 2007
Table 2.6 The Top Five Countries by Out-of-Pocket (OOP) Expenditure on Health, 2007
Table 2.7 The Top Five Countries by Total Expenditure on Health, 2007
Table 2.8 The Top Five Countries by Total Expenditure on Drugs as Percentage of Total Expenditure on Health, 2007
Table 2.9 Top Five Countries by Total Health Spending per Capita, 2007
Table 2.10 Factors that Influence Drug Prices, 2010
Table 2.11 Current Practices in the Development of Increased Generic Use, 2010
Table 3.1 Annual Growth in Private Health Insurance Premiums, 1989-2004
Table 3.2 A Comparison in Average Plan Costs Between Several Californian HMOs, 2004
Table 3.3 Monthly Insurance Premiums: Single and Family Enrolled in Group Health Plans, 2004
Table 3.4 US Spending on Healthcare in Comparison with Other Countries, 2007
Table 3.5 Sources of US Healthcare Payments, 2007
Table 3.6 US Healthcare Spending by Category, 2008
Table 3.7 Annual Growth Rates by US Healthcare Spending Categories, 2008
Table 3.8 US Healthcare Spending, 2000-2005
Table 3.9 The Relative Contributions of Price, Usage and Drug Type to Increases in Pharmaceutical Prices, 1997-2002
Table 3.10 A Comparison of Prescription Drug Prices For a 30-day supply: US and Europe, 2010
Table 3.11 Timeline of Key Elements for the PPACA, 2010-2012
Table 3.12 Timeline of Key Elements for the PPACA, 2013-2020
Table 4.1 Price Control or Drug Supply Control Mechanisms as Part of P&R Systems, 2010
Table 4.2 Pricing and Reimbursement Systems of Selected European Countries, 2005
Table 4.3 The Two Broad P&R Systems in Europe, 2010
Table 4.4 EU Countries and Reference Pricing, 2005
Table 4.5 Generic Use in Europe, 2004
Table 4.6 The Advantages and Disadvantages of a Single European Price for All Drugs, 2010
Table 5.1 Aspects of German Healthcare Spending, 2007
Table 5.2 Examples of Drug Reforms in Germany, 2004-2010
Table 6.1 Aspects of French Healthcare Spending, 2009
Table 7.1 Healthcare Statistics for the Italian Market, 2007
Table 7.2 Reimbursement Classes of Drugs in the Italian Market, 2010
Table 8.1 Aspects of Spanish Healthcare Spending, 2007
Table 8.2 Reimbursement Categories in the SNS, 2010
Table 9.1 Aspects of UK Healthcare Spending, 2007
Table 9.2 Pharmaceutical Companies Participating in the PPRS, 2009
Table 9.3 Prescription Charges in the UK, 2010
Table 9.4 People Entitled to Free Prescriptions in UK, 2010
Table 9.5 How a 'QALY' is Calculated by NICE, 2010
Table 9.6 UK Department of Health Classes of Generic Drugs, 2010
Table 10.1 Aspects of Japanese Healthcare Spending, 2007
Table 10.2 Classification and Rate of Japanese Drug Pricing Premiums, 2010
LIST OF FIGURES
Figure 2.1 Leading Generic Drug Markets: Market Shares, 2008
Figure 3.1 US Healthcare System, 2010
COMPANIES LISTED
A. Menarini Pharma UK S.R.L
Abbott Laboratories Ltd
Abraxis BioScience Inc
Acorus Therapeutics Ltd
Actavis UK Ltd
Actelion Pharmaceuticals UK Ltd
Agenzia Italiana del Farmaco (AIFA, Italian Medicines Agency)
Alan Pharmaceuticals Ltd
Alcon Laboratories (UK) Ltd
Alexion Pharma UK
Alk-Abello (UK) Ltd
Allergan Ltd
Allergy Therapeutics Ltd
Alliance Pharmaceuticals Ltd
Almirall UK Ltd
Alphashow Ltd
Amdipharm plc
Amerlioration du Service Medical Rendu (ASMR, France)
Amgen Ltd
Archimedes Pharma UK Ltd
Ardern Healthcare Ltd
Aspen Global Inc
Astellas Pharma Inc
AstraZeneca plc
Axcan Pharma S.A.
B. Braun Medical Ltd
Basilea Pharmaceuticals Ltd
Bayer plc
Beacon Pharmaceuticals Ltd
Biogen Idec Ltd
BioMarin Europe Ltd
Biovitrum AB
Boehringer Ingelheim
Bristol-Myers Squibb Pharmaceuticals
Bundesinstitut fьr Arzneimittel und Medizinprodukte (BfArM, Germany)
Bundesministerium fьr Gesundheit (Federal Ministry of Health and Social Security, Germany)
Bundesministerium fur Gesundheit und Soziales (BMGS, Germany)
Bureau of Indian Affairs (State Provision, USA)
Cambridge Laboratories Ltd
Celgene Ltd
Centre for Medicare and Medicaid Services (CMS, USA)
Cephalon UK Ltd
Chanelle Medical U.K. Ltd
Chemidex Pharma Ltd
Chiesi Ltd
Chugai Pharma UK Ltd
CliniMed Ltd
Comitй Economique des Produits de Santй (CEPS, formerly CEM, EU)
Consiglio Superiore di Sanita (CSS, National Health Council, Italy)
Cotisation Maladie Universelle (CMU, France)
CP Pharmaceuticals Ltd
Crucell (UK) Ltd
Daiichi Sankyo
Dee Pharmaceuticals Ltd
Derma UK Ltd
Dermal Laboratories Ltd
Dexcel Pharma Ltd
DHP healthcare Ltd
Direcciуn General de Farmacia y Productos Sanitarios (DGFPS, Spain)
Discovery Pharmaceuticals Ltd
Dr Faulk Pharma UK Ltd
E C De Witt & Company Ltd
Ecolab Inc
Eisai Ltd
Eli Lilly & Company Ltd
Eumedica Pharmaceuticals A.G
European Medicines Evaluation Agency (EMEA)
Exclusive Provider Organization (EPO, USA)
Exelgyn Laboratories Ltd
Ferndale Pharmaceuticals Ltd
Ferring Laboratories Ltd
Flynn Pharma Ltd
Food and Drug Administration (FDA, USA)
Forest Laboratories UK
Forum Health Products Ltd
Fresenius Medical Care (UK) Ltd
Galderma (UK) Ltd
Galen Ltd
GE Healthcare Ltd
Geistlich Sons Ltd
Generics (UK) Ltd
Genzyme Therapeutics
German Association of Research-based Pharmaceutical Companies (VFA, Germany)
GlaxoSmithKline UK Ltd
Glenwood Laboratories Ltd
Goldshield Group plc
Grunenthal Ltd
Health Insurance Options for the Unemployed (COBRA, USA)
Health Maintenance Organisations (HMOs, USA)
HK Pharma Ltd
IBA Molecular UK Ltd
Independent Practice Association (IPA, USA)
INO Therapeutics Ltd
Institute for Quality and Economy in the Health Care Sector (IQWiG, Germany)
Institute of Pharmaceutical Management
Intrapharm Laboratories Ltd
Ipsen Ltd
IS Pharma plc
IS Pharmaceuticals Ltd
Janssen-Cilag Ltd
Javelin Pharmaceuticals Ltd
Johnson & Johnson MSD (McNeil Healthcare (UK) Ltd
Kestrel Ophthalmics Ltd
King Pharmaceuticals Ltd
Kyowa Hakko UK Ltd
Lincoln Medical Ltd
Lundbeck Ltd
Marlborough Pharmaceuticals Ltd
Martindale Pharmaceuticals Ltd
MASTA Ltd
Meda Pharmaceuticals Ltd
Medac International GmbH
Medicaid (State Provision, USA)
Medicare (State Provision, USA)
Merck Serono
Merck Sharp & Dohme Ltd
Merz Pharma UK Ltd
Ministry of Health, Labour and Welfare (MHLW, Japan)
Molnlycke Health Care
Nacional de la Salud/National Institutes of Health, INSALUD, Spain)
National Coalition on Health Care (NCHC, USA)
National Health Service (NHS, UK)
National Institute for Health Management (INGESA, previously Instituto Nacional de la Salud/National Institutes of Health, INSALUD, Spain)
National Institute for Health Management (INGESA, previously Instituto)
National Institute of Clinical Effectiveness (NICE, UK)
National Pharmacists' Association (NPA, Spain)
NHS Prescription Services (previously known as the Prescription Pricing Division or PPD, UK)
Nordic Pharma (UK) Ltd
Norgine Pharmaceuticals Ltd
Novartis
Novartis Consumer Health (UK) Ltd
Novartis Vaccines & Diagnostics Ltd
Novo Nordisk
Nycomed UK Ltd
Organisation for Economic Co-operation and Development (OECD)
Orion Pharma UK Ltd
Orphan Europe (UK) Ltd
Otsuka Pharmaceuticals (UK) Ltd
Ovation Healthcare International Ltd
Paines & Byrne Ltd
Peckforton Pharmaceuticals Ltd
Pfizer Inc
Pharma Mar, S.A.
Pharmasure Ltd
Physician-Hospital Organization (PHO, UK)
Pierre Fabre Ltd
PLIVA Pharma Ltd
Preferred Provider Organization (PPO, USA)
Procter & Gamble
Profile Pharma Ltd
Prontuario Farmaceutico Nazionale (PFN, National Pharmaceutical Formulary, Italy)
ProStrakan Group plc
Ranbaxy (UK) Ltd
Ratiopharm (now part of Teva)
Recordati Pharmaceuticals Ltd
Resource Medical UK Ltd
Roche
Rosemont Pharmaceuticals Ltd
Sagani Ltd
Sanochemia UK Ltd
Sanofi Pasteur MSD
Sanofi-Aventis
Schering Plough Ltd
Servier Laboratories Ltd
Servizio Sanitario Nazionale (SSN, the Italian National Health Service, NHS)
Shire Pharmaceuticals Ltd
Sigma-Tau Pharma Ltd
Smith & Nephew Healthcare
Solvay Healthcare Ltd
SpectrumThea Pharmaceuticals Ltd
SpePharm UK Ltd
SSL International plc
STADA Arzneimittel AG
State Children's Health Insurance Program (SCHIP) (State Provision, USA)
STD Pharmaceutical Products Ltd
Stiefel Laboratories (UK) Ltd
Stragen UK Ltd
Syner-Med (Pharmaceutical Products) Ltd
Takeda UK Ltd
Teofarma S.r.I.
Teva UK Ltd
The American Association for Retired Persons (AARP)
The Medicines and Healthcare Products Regulatory Agency (MHRA, UK)
The Pharmaceutical Price Regulation Scheme (PPRS, UK)
The Spanish National Health System (SNS)
Thornton & Ross Ltd
Tillomed Laboratories Ltd
TopoTarget A/S
Transdermal Ltd
TRICARE, formerly Civilian Health and Medical Program of the Uniformed Services (CHAMPUS, USA)
UCB Pharma Ltd
UnitedHealth Group
Veterans Health Administration (VHA, USA)
Vitaline Pharmaceuticals UK Ltd
Walgreens
Wal-Mart
William Ransom & Son plc
Wyeth (now part of Pfizer)
Yamanouchi Pharmaceutical Co. (now Astellas Pharma)
Figure 2.1 Leading Generic Drug Markets: Market Shares, 2008
Figure 3.1 US Healthcare System, 2010
COMPANIES LISTED
A. Menarini Pharma UK S.R.L
Abbott Laboratories Ltd
Abraxis BioScience Inc
Acorus Therapeutics Ltd
Actavis UK Ltd
Actelion Pharmaceuticals UK Ltd
Agenzia Italiana del Farmaco (AIFA, Italian Medicines Agency)
Alan Pharmaceuticals Ltd
Alcon Laboratories (UK) Ltd
Alexion Pharma UK
Alk-Abello (UK) Ltd
Allergan Ltd
Allergy Therapeutics Ltd
Alliance Pharmaceuticals Ltd
Almirall UK Ltd
Alphashow Ltd
Amdipharm plc
Amerlioration du Service Medical Rendu (ASMR, France)
Amgen Ltd
Archimedes Pharma UK Ltd
Ardern Healthcare Ltd
Aspen Global Inc
Astellas Pharma Inc
AstraZeneca plc
Axcan Pharma S.A.
B. Braun Medical Ltd
Basilea Pharmaceuticals Ltd
Bayer plc
Beacon Pharmaceuticals Ltd
Biogen Idec Ltd
BioMarin Europe Ltd
Biovitrum AB
Boehringer Ingelheim
Bristol-Myers Squibb Pharmaceuticals
Bundesinstitut fьr Arzneimittel und Medizinprodukte (BfArM, Germany)
Bundesministerium fьr Gesundheit (Federal Ministry of Health and Social Security, Germany)
Bundesministerium fur Gesundheit und Soziales (BMGS, Germany)
Bureau of Indian Affairs (State Provision, USA)
Cambridge Laboratories Ltd
Celgene Ltd
Centre for Medicare and Medicaid Services (CMS, USA)
Cephalon UK Ltd
Chanelle Medical U.K. Ltd
Chemidex Pharma Ltd
Chiesi Ltd
Chugai Pharma UK Ltd
CliniMed Ltd
Comitй Economique des Produits de Santй (CEPS, formerly CEM, EU)
Consiglio Superiore di Sanita (CSS, National Health Council, Italy)
Cotisation Maladie Universelle (CMU, France)
CP Pharmaceuticals Ltd
Crucell (UK) Ltd
Daiichi Sankyo
Dee Pharmaceuticals Ltd
Derma UK Ltd
Dermal Laboratories Ltd
Dexcel Pharma Ltd
DHP healthcare Ltd
Direcciуn General de Farmacia y Productos Sanitarios (DGFPS, Spain)
Discovery Pharmaceuticals Ltd
Dr Faulk Pharma UK Ltd
E C De Witt & Company Ltd
Ecolab Inc
Eisai Ltd
Eli Lilly & Company Ltd
Eumedica Pharmaceuticals A.G
European Medicines Evaluation Agency (EMEA)
Exclusive Provider Organization (EPO, USA)
Exelgyn Laboratories Ltd
Ferndale Pharmaceuticals Ltd
Ferring Laboratories Ltd
Flynn Pharma Ltd
Food and Drug Administration (FDA, USA)
Forest Laboratories UK
Forum Health Products Ltd
Fresenius Medical Care (UK) Ltd
Galderma (UK) Ltd
Galen Ltd
GE Healthcare Ltd
Geistlich Sons Ltd
Generics (UK) Ltd
Genzyme Therapeutics
German Association of Research-based Pharmaceutical Companies (VFA, Germany)
GlaxoSmithKline UK Ltd
Glenwood Laboratories Ltd
Goldshield Group plc
Grunenthal Ltd
Health Insurance Options for the Unemployed (COBRA, USA)
Health Maintenance Organisations (HMOs, USA)
HK Pharma Ltd
IBA Molecular UK Ltd
Independent Practice Association (IPA, USA)
INO Therapeutics Ltd
Institute for Quality and Economy in the Health Care Sector (IQWiG, Germany)
Institute of Pharmaceutical Management
Intrapharm Laboratories Ltd
Ipsen Ltd
IS Pharma plc
IS Pharmaceuticals Ltd
Janssen-Cilag Ltd
Javelin Pharmaceuticals Ltd
Johnson & Johnson MSD (McNeil Healthcare (UK) Ltd
Kestrel Ophthalmics Ltd
King Pharmaceuticals Ltd
Kyowa Hakko UK Ltd
Lincoln Medical Ltd
Lundbeck Ltd
Marlborough Pharmaceuticals Ltd
Martindale Pharmaceuticals Ltd
MASTA Ltd
Meda Pharmaceuticals Ltd
Medac International GmbH
Medicaid (State Provision, USA)
Medicare (State Provision, USA)
Merck Serono
Merck Sharp & Dohme Ltd
Merz Pharma UK Ltd
Ministry of Health, Labour and Welfare (MHLW, Japan)
Molnlycke Health Care
Nacional de la Salud/National Institutes of Health, INSALUD, Spain)
National Coalition on Health Care (NCHC, USA)
National Health Service (NHS, UK)
National Institute for Health Management (INGESA, previously Instituto Nacional de la Salud/National Institutes of Health, INSALUD, Spain)
National Institute for Health Management (INGESA, previously Instituto)
National Institute of Clinical Effectiveness (NICE, UK)
National Pharmacists' Association (NPA, Spain)
NHS Prescription Services (previously known as the Prescription Pricing Division or PPD, UK)
Nordic Pharma (UK) Ltd
Norgine Pharmaceuticals Ltd
Novartis
Novartis Consumer Health (UK) Ltd
Novartis Vaccines & Diagnostics Ltd
Novo Nordisk
Nycomed UK Ltd
Organisation for Economic Co-operation and Development (OECD)
Orion Pharma UK Ltd
Orphan Europe (UK) Ltd
Otsuka Pharmaceuticals (UK) Ltd
Ovation Healthcare International Ltd
Paines & Byrne Ltd
Peckforton Pharmaceuticals Ltd
Pfizer Inc
Pharma Mar, S.A.
Pharmasure Ltd
Physician-Hospital Organization (PHO, UK)
Pierre Fabre Ltd
PLIVA Pharma Ltd
Preferred Provider Organization (PPO, USA)
Procter & Gamble
Profile Pharma Ltd
Prontuario Farmaceutico Nazionale (PFN, National Pharmaceutical Formulary, Italy)
ProStrakan Group plc
Ranbaxy (UK) Ltd
Ratiopharm (now part of Teva)
Recordati Pharmaceuticals Ltd
Resource Medical UK Ltd
Roche
Rosemont Pharmaceuticals Ltd
Sagani Ltd
Sanochemia UK Ltd
Sanofi Pasteur MSD
Sanofi-Aventis
Schering Plough Ltd
Servier Laboratories Ltd
Servizio Sanitario Nazionale (SSN, the Italian National Health Service, NHS)
Shire Pharmaceuticals Ltd
Sigma-Tau Pharma Ltd
Smith & Nephew Healthcare
Solvay Healthcare Ltd
SpectrumThea Pharmaceuticals Ltd
SpePharm UK Ltd
SSL International plc
STADA Arzneimittel AG
State Children's Health Insurance Program (SCHIP) (State Provision, USA)
STD Pharmaceutical Products Ltd
Stiefel Laboratories (UK) Ltd
Stragen UK Ltd
Syner-Med (Pharmaceutical Products) Ltd
Takeda UK Ltd
Teofarma S.r.I.
Teva UK Ltd
The American Association for Retired Persons (AARP)
The Medicines and Healthcare Products Regulatory Agency (MHRA, UK)
The Pharmaceutical Price Regulation Scheme (PPRS, UK)
The Spanish National Health System (SNS)
Thornton & Ross Ltd
Tillomed Laboratories Ltd
TopoTarget A/S
Transdermal Ltd
TRICARE, formerly Civilian Health and Medical Program of the Uniformed Services (CHAMPUS, USA)
UCB Pharma Ltd
UnitedHealth Group
Veterans Health Administration (VHA, USA)
Vitaline Pharmaceuticals UK Ltd
Walgreens
Wal-Mart
William Ransom & Son plc
Wyeth (now part of Pfizer)
Yamanouchi Pharmaceutical Co. (now Astellas Pharma)
