Currently, free pricing of products with a new chemical entity (NCE) applies in the first year. This means, at the time of launch in the German market, pharmaceutical companies are free to set the price for their product. This price is then valid for the first 12 months from the day of launch.
Therefore, it is no surprise that the groups paying for these products, i.e. the SHI funds, demand some thresholds to the prices and that the AMNOG rules are changed. The biggest of these SHI funds, the AOK, now proposes to put an end to the free pricing period for the first 12 months.
This is nothing new, and changes have been demanded previously. However, this time it is more likely to become a reality. The AOK proposal coincides with the formation of the next coalition government. Both the SPD and the Green Party have also requested AMNOG reforms in the past.
AOKs proposal
There are four key areas, the AOK would like to amend:
Interim price
Instead of the current free pricing applicable from the day of the launch, the AOK proposes to introduce an interim price. Once a final reimbursement price has been negotiated after the benefit assessment was conducted, this reimbursed price should also be applied retroactively from day 1.
Discount to SHI funds given by manufacturer
In addition, the AOK suggests that the discount which manufacturers are obliged to grant the SHI funds (= “Herstellerabschläge”) is increased from the current 7% to 16%.
Price setting
The AOK envisages that, in the future, the price could be set in the “fair pricing” process developed by the AIM at the Erasmus University of Rotterdam.
Fast track approvals
The AOK criticises that more and more orphan drugs are being approved through fast track approvals. For these, there often isn’t enough supportive data available at the time of launch to assess their efficacy and safety. Therefore, the AOK demands the use of transparent criteria for their assessment, as well as an update to the definition of orphan drugs. Furthermore, they request to re-consider the criteria for a high demand that justify a fast track approval.