Bulgaria's Health Minister Presents Proposals for Changes to P&R System, Announces Reduced Oncology Drug Prices
Bulgaria's health minister has announced a series of proposals for reforms to the drug pricing and reimbursement system in the country, as reduced prices on oncology drugs are reportedly negotiated.
IHS Global Insight Perspective
A series of important proposals for reforming the system of drug pricing and reimbursement in Bulgaria have been put forward by the country's health minister, as new reduced prices for oncology drugs have reportedly been negotiated.
The proposals are a response to the major drug-price scandal that resulted in the early resignation of the previous Bulgarian health minister.
It remains to be seen whether these measures will pass through the legislature without obstacles, but if so, they will inaugurate major changes in Bulgaria's drug pricing and reimbursement system, which could be predominantly negative for the pharmaceutical industry, resulting in lower prices and longer delays to reimbursement.
Series of Changes to Bulgaria's P&R System Proposed
Bulgaria's new health minister Desislava Atanasova has announced a series of proposals for reforming the system of pharmaceutical pricing and reimbursement (P&R) in the country, which she has presented to representatives of both the innovative and generic pharmaceutical industries. Additionally, she has also announced that discounts on the prices of oncology medicines have already been negotiated with a number of producers. These measures are a response to the pricing scandal that engulfed the previous health minister, Stefan Konstantinov, and ultimately resulted in his resignation.
Main Changes Proposed by Health Minister
As Bulgarian business newspaper Capital reports the main proposals put forward by Desislava are as follows:
- A special state regulatory commission would be established with responsibility for setting the prices and reimbursement levels of drugs covered by the National Health Insurance Fund (NZOK). Unlike the present committee that has responsibility for this, the proposed body would comprise members who are only employed in this body, rather than being collected from a number of different institutions; it is thought that this would speed up the process of drug-price reductions.
- The NZOK would be able to negotiate prices and discounts in the case of all medicines subject to reimbursement, rather than just the 188 medicines that are subject to 100% reimbursement.
- More countries would be added to the current basket of reference countries used in international reference pricing (IRP). At present, eight countries in the EU are referenced, with the lowest price of these taken as a reference price; although it has not been decided how many EU countries will be referenced, it is possible that it will be all of them.
- Price referencing in Bulgaria would take place every six months, rather than annually, as at present.
- It is proposed that in order for a new medicine to obtain reimbursement in Bulgaria, it will need to have secured reimbursement in five other countries.
- It is also proposed that there should be a requirement for generics entering the market to be a specified percentage lower in price than originators in order to obtain reimbursement.
- Finally, Atanasova stated that she is going to negotiate with pharmacists and wholesalers to determine how much lower they can bring down their margins, in order to help reduce the end-user prices of medicines.
Discounts Already Negotiated, Including for Oncology Drugs
Discounts worth 4.5 million leva (USD3.0 million) are reported to have already been negotiated by the NZOK on reimbursed drugs, and 50 companies producing oncology medicines have reportedly made discount offers, according to director of the NZOK Kalina Pencheva, reported by Capital. Subsequently, Bulgarian medical news provider Hospital.bg reported that Atanasova has announced that favourable discounts have been negotiated concerning the prices of oncology medicines, the details of which are reported to be on the NZOK's website.
Additionally, Capital reports that representatives of the pharmaceutical industry have proposed to Atanasova that the proportion the NZOK pays towards the price of cardiovascular medicines should be increased, as this is the therapeutic area associated with the largest number of medicines used in Bulgaria, with around 2 million people estimated to be suffering from cardiovascular disease in the country.
Outlook and Implications
The proposals made by Atanasova are a direct response to the scandal that broke in the field of pharmaceutical pricing under the previous health minister, which was the cause of his resignation (see Bulgaria: 13 March 2012: More Drug-Pricing "Scandal" Details Emerge in Bulgaria As Price-Reduction Measures Presented). If the proposals are accepted by parliament and passed into law, they will represent a significant reform of the P&R system in Bulgaria, which will have a profound effect on each sector of the pharmaceutical industry.
Specifically, if it is decided that the IRP system is to be changed so that the lowest price in the whole EU is referenced, this would be an important change, which would result in Bulgaria's drug pricing moving towards that of Greece and Romania. Former health minister Konstantinov had put forward a plan to reference countries outside the EU, which was rejected; this new plan may be a kind of compromise. Furthermore, it could significantly delay access to innovative medicines if it is decided that a new innovative medicine has to be reimbursed in five other countries already before it gains reimbursement in Bulgaria. On the other hand, a better and faster functioning body in charge of drug pricing and reimbursement could be beneficial for the whole industry.
The details of discounts negotiated by the NZOK, and discounts on oncology drugs in particular, are yet to come to light, although the fact that they have been announced shows that some serious activity followed the breaking of the drug-pricing scandal in February–March, and that a different P&R landscape could be emerging in Bulgaria.
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