The Act on the Reform of the Market for Medicinal Products (AMNOG): A question of power?!
©2015
Textbook
67 Pages
Summary
In the past, high costs have been incurred in particular by the market launch of new medicinal products. To date, it was not necessary to demonstrate an additional therapeutic benefit. This changed with the Act on the Reform of the Market for Medicinal Products (AMNOG), which entered into force on the 1st of January 2011. It brought about a fundamental change in the balance of power on the pharmaceutical market. <br>This study therefore sets out to answer the following question: What impact does the early benefit assessment in the context of the AMNOG have on the stakeholders of the healthcare system? To answer this question, this survey first presents the theoretical foundations of the law, of the early benefit assessment and the bodies involved. It then takes stock of the decisions taken to date before describing the impact on the selected stakeholders.
Excerpt
Table Of Contents
3.3.2 A critical assessment from the perspective of the pharmaceutical industry
... 40
3.4 The impact on patients ... 45
3.4.1 Patient organisation in Germany
... 45
3.4.2 A critical analysis from the patient's perspective
... 46
3.5 Conclusion ... 49
4
. Summary and Outlook ... 51
Bibliography ... 53
List of figures ... 59
List of tables ... 60
List of appendixes ...
... 61
Appendix ... 61
9
List of abbreviations
ACHSE
Allianz Chronischer Seltener Erkrankungen e.V. (Alliance of
Chronic Rare Diseases e.V.)
AMNOG
Arzneimittelmarktneuordnungsgesetz (Act on the Reform of the
Market for Medicinal Products)
AM-NutzenV
Arzneimittel-Nutzenbewertungsverordnung (Ordinance on the
Early Benefit Assessment of Pharmaceuticals)
BMG
Bundesministerium für Gesundheit (Federal Ministry of Health)
BPI
Bundesverband der Pharmazeutischen Industrie e.V. (German
Pharmaceutical Industry Association)
G-BA
Gemeinsamer Bundesauschuss (Federal Joint Committee)
GBE
Gesundheitsberichtserstattung des Bundes (Advisory Council on
the Assessment of Developments in the Healthcare System)
GKV
Gesetzliche Krankenversicherung (Statutory Health Insurance)
HTA
Health Technology Assessment
IQWiG
Institut für Qualität und Wirtschaftlichkeit im Gesundheitswesen
(Institute for Quality and Efficiency in Healthcare)
vfa
Verband Forschender Arzneimittelhersteller e.V. (German
Association of Research-based Pharmaceutical Companies)
10
"In a healthcare distribution system with a capped budget, at the end of the day it always comes
down to a question of power."
- Bernd Wegener, Chairman of the Board of the
German Pharmaceutical Industry Association (BPI)
11
1. Introduction
The German healthcare system is underpinned by the principle of solidarity. A health
insurance fund, financed by contributions from employers
1
and employees, forms the
financial basis of the system. This fund is used to pay all diagnostic and therapeutic
benefits for citizens insured under statutory insurance schemes (Busse, et al., 2013, p
114). Healthcare resources are therefore limited. The financing of the fund faces a
number of challenges: an increasingly aging population with increased morbidity, a
decreasing number of young contributors and increased costs due to actual or supposed
pharmaceutical innovations.
It is only natural therefore that the health insurance funds should be interested in
scientifically proven treatments. The Federal Joint Committee (G-BA), a centralised
body, decides on the eligibility of treatments for reimbursement. In order to reach a
decision on the benefits of treatments that is as scientifically substantiated as possible,
the G-BA commissions so-called Health Technology Assessments (HTA). HTAs are
benefit assessments entailing the evaluation of existing studies and medical
publications. The Institute for Quality and Efficiency in Healthcare (IQWiG) is one of
the bodies entrusted with such HTAs in Germany.
In the past, high costs have been incurred in particular by the market launch of new
medicinal products. To date, it was not necessary to demonstrate an additional
therapeutic benefit. This changed with the Act on the Reform of the Market for
Medicinal Products (AMNOG), which entered into force on the 1
st
of January 2011.
This Act regulates the pricing of newly authorised medicinal products and thus their
eligibility for reimbursement by statutory health insurance (GKV). In future, the
manufacturer must demonstrate proof of an added benefit over a comparator therapy for
all new medicinal products. The G-BA thus decides on the extent of the added benefit.
It is assisted in its decision-making by an IQWiG benefit assessment.
1
To make this survey easier to read, the generic masculine is used even when referring to both genders.
12
1.1 Scope
The early benefit assessment in the context of AMNOG has consequences for all
stakeholders within the healthcare system. Two and a half years after its entry into
force, the impact of the Act is becoming more apparent, now allowing a more
discriminating analysis. This survey starts out by examining the theoretical foundations
of the law and the bodies involved. This is followed by a critical analysis of the early
benefit assessment of pharmaceuticals from the perspective of the health insurance
funds, the pharmaceutical industry and the patients.
1.2 The central research question
What impact does the early benefit assessment in the context of AMNOG have on the
stakeholders of the healthcare system in the light of the available data?
1.3 Methodology
The first part of the book will set out the theoretical background. For this purpose, the
necessity of adopting the Act and its objectives will be elucidated. One aspect of the Act
is the early benefit assessment, which will be explained in greater detail below. To ease
understanding, the two bodies involved - the G-BA and the IQWiG will first be
presented and the structure and content of the dossier underlying an early benefit
assessment clarified.
The second part of the survey will go through the available data relating to the practical
experience garnered to date. It will begin with an analysis of benefit assessments
already concluded, which will provide a deeper insight into the frequencies and
differences observed in the granting of added benefits, illustrated by diagrams
accompanied by comments. The views of three stakeholders in the assessment
procedure are subsequently set out. These are: pharmaceutical companies as
manufacturers of the medicinal products subject to the assessment, the health insurance
funds as administrators of the finances of the healthcare system and the patients
2
who
rely on pharmaceutical innovations. This should make it possible to consider the early
benefit assessment from the most important angles.
2
In the context of this survey, "patients" shall be defined as all insured persons who currently receive
healthcare benefits.
13
Due to the timeliness of the topic, the limited national relevance and the relatively short
period since the entry into force of the law, the literature on early benefit assessment is
few and far between. The survey has therefore drawn on statements, annual reports,
scientific articles, reports, etc. The author also personally participated in public hearings
of the G-BA and cooperated in a workshop on "Economics and Health Technology
Assessments in the area of haemophilia".
Finally, the impact of the early benefit assessment is interpreted and conclusions drawn.
14
2. The Act on the Reform of the Market for Medicinal Products
The steady progress in pharmaceutical treatments as a result of constantly new and,
above all, costly drugs and treatment options presents a challenge for healthcare
resources. That is why the health insurance funds are always on the lookout for ways of
cutting their costs and, over the years, a variety of healthcare policy measures have been
introduced to achieve such savings. The Act on the Reform of the Market for Medicinal
Products (AMNOG), anchored in paragraph 35a of Volume 5 of the German Social
Code, adopted by the German parliament on the 11
th
of November 2010 and in force
since the 1
st
of January 2011, is an important instrument in this case in point.
2.1 The background of the Act
In 2009, more than 30 billion euros were spent on medicinal products, including the co-
payments of the insured (Federal Ministry of Health, 2013a). A significant share of this
total was incurred by innovative but also cost-intensive special preparations. "They
already account for around 26 per cent of SHI's volume of medicinal products, although
their share of prescription accounts for only 2.5 per cent" (German Parliament, 2010).
The increase in the cost of medicinal products without a reference price is particularly
high in this respect. According to Jens Baas, Chairman of the Board of the Techniker
Krankenkasse health insurance fund:
"The expenditure for this is the second largest item for the SHI. Properly
applied, a good pharmaceutical therapy can be one of the most effective
medical acts. The pharmaceutical industry is often seen as an innovative
industry. And also in the political debate, "pharmaceuticals" are a topic that
comes back time and time again. It is therefore worthwhile to continuously and
carefully monitor the supply of pharmaceuticals." (Windt, et al., 2013, p. 5).
However, developing a new drug is a time-consuming and cost-intensive process. It
takes an average of twelve years and costs several million euros from inception to
approval. The pharmaceutical industry spends a great deal of money developing drugs
with improved properties, and new indications and innovations in the supply of
medicinal products are both desirable and indispensable. However, they are also a
source of conflicts of interest between stakeholders. As shown in figure 1, on the one
15
hand, there is a service catalogue bursting with high-quality and innovative drugs that
should be fully available for patients. On the other hand, you have the limited resources
of the SHI and the demand for sustainable financing. At the same time, the
pharmaceutical industry must be supported and rewarded appropriately for the
development of innovation. Thus, a "conflict arises between the industrial policy
objective of promoting Germany as a location for innovation and the social policy
objective of reducing expenditure" (Kohler, 2013, p. 21).
Figure 1: The conflict on the pharmaceutical supply market
Source: Own diagram
"The medicinal products market is like no other. It's the realm of public health and thus
a prerequisite for participation in society" (Wasem, 2012, p. 27). The healthcare
decision-makers are therefore increasingly coming under the spotlight when it comes to
deciding on optimal diagnostic and therapeutic measures. Thus health policy is also
obliged to navigate its way through the medicinal products market and thus also juggle
the expenditure on medicinal products with the help of effective instruments. Clinical
studies and medical publications are of significant importance and are part and parcel of
the on-going trend towards evidence-based medicine (Evans, et al., 2013, p. 20). For
example, in recent years, a variety of policy measures has been introduced to keep down
the expenditure of the SHIs. "Of the 30 regulatory instruments that existed up until the
SHI
social policy objectives
Sustainable financing
Best-possible supply of the insured
Financial stability of the supply market
Reduction in expenditure
Pharmaceutical
companies
industrial policy objectives
Safeguarding Germany's status as a
location for innovation
Appropriate renumeration
Encouragement of research
Patients
High-quality and innovative service
catalogue
Highest possible level of supply
Unlimited access to drugs
16
entry into force of the AMNOG at the beginning of 2011, 24 targeted a limitation of
drug expenditure (price or quantity)" (Cassel & Ulrich, 2012, p. 58).
Back in 2007, the SHI Competition Enhancement Act stipulated that the IQWiG could
be delegated by the G-BA with a benefit or cost-benefit assessment, primarily designed
to find a "reimbursement amount" that appropriately remunerates the added benefit of
newly authorised drugs (paragraph 35b of Volume V of the German Social Code).
However, "the management tools introduced up until 2011 [ ... ] were unable to bring
about the desired balance between heightened efficiency and cost containment in the
field of the supply of medicinal products" (Köhler, 2013, p. 21). This can be put down
to the fact that, until the entry into force of the AMNOG, pharmaceutical companies
were able to set the prices for new drugs themselves, regardless of whether the drugs
could produce an added benefit over existing drugs or not. The costs incurred were
particularly high and spiralled (Federal Ministry of Health, 2010). The therapeutic
added benefits and a fair balance of interests with respect to unreasonably high prices
were often questionable. A survey showed that Germany was "a high-price country for
non-fixed-price controlled medicinal products, the only country - apart from Malta
with no price regulation for such preparations and the largest European market and
reference price country in the international pricing system" (Dingermann, 2013, p. 770).
As a consequence, some aspects of the pharmaceutical products market changed with
the introduction of AMNOG, as the market - as the name of the Act already implies
was "reformed". According to the Federal Ministry of Health", the Act "paves the way
for fair competition and a stronger focus on patient welfare" (Federal Ministry of
Health, 2013b). The objectives pursued are presented in the following section.
2.2 The objectives of the Act
The AMNOG sets out to achieve three goals: structural changes, reduction of over-
regulation and short-term savings. These measures are intended to cut costs by 2
billion per year. Above all, however, the legislator is hoping for cheaper innovations for
the German market (Federal Ministry of Health, 2013b).
The following objectives of the law have no role to play in the context of this study, but
for the sake of completeness are described briefly
3
:
3
More detailed information on this can be found for example on the website of the Federal Ministry of
Health.
17
To counteract over-regulation, under the AMNOG, on the one hand, the two-opinion
process (clause 73 d) and, on the other hand, the merit/demerit pricing system have been
abolished. (Federal Ministry of Health, 2013b). Increasing the pharmacy rebate from
1.75 to 2.05 euros per pack of a prescription drug is a way of cutting costs for the health
insurance funds in the short term. "The wholesale trade will lose a total of about 200
million euros in favour of the funds, of which EUR 170 million for the SHI" (Bergh,
2010, p. 5). Furthermore, the health insurance funds are set to save 300 million euros
per year, as vaccine manufacturers in Germany are not allowed to charge higher prices
than the major countries of the EU. Another example of cost-containment measures are
cytostatic drugs
4
. If these are given as an infusion, in future only "fair market settlement
prices" are to be agreed. Savings of 100 million euros annually are expected here by the
SHI (Bergh, 2010, p. 5).
The structural changes mainly concern the newly introduced assessment of the added
benefit and thus the early benefit assessment. In the context of this survey, the focus
will be put on this part in particular, which is examined in detail in section 2.4.
4
Cytotoxic drugs are "drugs used in chemotherapy that inhibit the growth of cancer cells, but that can
also damage normal tissue" (GBE, 2013).
18
2.3 The Federal Joint Committee (G-BA)
Before illustrating the early benefit assessment procedure, it is first necessary to give an
outline of the body known as the Federal Joint Committee (G-BA). This is the decision-
making body in the field of early benefit assessment.
Figure 2: Distribution of seats and structure of the Federal Joint Committee
"The Federal Joint Committee (G-BA) is a legal entity under public law and is formed
by the four major umbrella organisations of self-management in the German healthcare
system (see figure 2): the Confederation of Contract Doctors and Dentists, the German
Hospital Federation and the Central Federal Association of Statutory Health Insurance
Funds" (G-BA, 2013a). The G-BA also has three impartial members, one of which is
the Chairman of the body. Thus, the G-BA is composed of 13 voting members. The
meetings of the G-BA can also be attended by five representatives of the patients. These
are not entitled to vote, but may submit proposals.
The G-BA is the supreme decision-making body for health-related topics and comes
under the legal supervision of the Federal Ministry of Health. The G-BA is divided into
nine sub-committees. The medicinal products subcommittee deals with the early benefit
assessment. The names of the members of the Committee are subject to strict
confidentiality in order to avoid possible interference (G-BA, 2013b).
5 Patient
representatives
5
R
ep
rese
nta
tives of the GK
V
5 Repr
es
entative
s of the care
p
rov
iders
G
, KB
V
, KZB
V
Chairman +
2 impartial members
Source: Own diagram
19
2.4 The Institute for Quality and Efficiency in Healthcare
The Institute for Quality and Efficiency in Healthcare (IQWiG) was established in 2003
as part of the SHI Modernisation Act. It operates under the auspices of self-management
in the German healthcare system. The Institute has received a general mandate from the
G-BA, i.e. it can also independently tackle themes and deal with them in so-called
"working papers". Its task is to examine the benefits and harms of medical measures.
Furthermore, the IQWiG receives concrete assignments from the G-BA. "The Institute
draws up professionally independent, evidence-based (substantiated) reports, for
example, on:
· medicinal products
· non-pharmacological treatments (e.g., surgical procedures)
· methods of diagnosis and early detection (screening)
· treatment guidelines and disease management programmes (DMP) "(IQWiG, no date).
As such, the Institute does not conduct studies on its own account, but draws on existing
studies and scientific publications.
The IQWiG is divided into three services (quality assurance, information management
and law) and eight departments (medicinal product assessment, non-pharmacological
methods, health economics, quality of care, health information, medical biometry,
communication and administration) (IQWiG, 2013a, p. 47 -51).
IQWiG is financed by charges for inpatient and outpatient medical care under the
statutory health insurance system. These charges are determined each year by the G-BA
according to the budget of the IQWiG.
Starting out with eleven staff members, the Institute now has 166 employees (see figure
3). 34 of the new jobs were created as a result of the AMNOG. In 2012, 37 employees
were working in the field of medicinal product assessment (IQWiG, 2013A, pp. 47-51).
20
Figure 3: Scope of the work of the IQWiG
Source: own diagramm according to IQWiG, 2013a, p. 44
Under the AMNOG, the IQWiG is assigned two new tasks: on the one hand, it assesses
the dossier of the pharmaceutical manufacturer and draws up a benefit assessment on
this basis. On the other hand it draws up a cost-benefit assessment in the event of an
unsuccessful arbitration award (the complete early benefit assessment procedure is
discussed in detail in section 2.6). This survey shall focus solely on the benefit
assessment however, since the drawing up of a cost-benefit assessment in the context of
AMNOG has not been necessary so far (IQWiG, 2013a, p. 18).
Total of 166 employees
8
6
6
3
37
13
19
14
15
17
11
17
Communication (8)
Quality assistance service (6)
Institute management (6)
Legal service (3)
Medicinal product assessment
(37)
Information management
service (13)
Health information (19)
Quality of supply (14)
Medical biometrics (15)
Non-pharmacological processes
(17)
Health econimics (11)
Administration (17)
21
2.5 The manufacturer dossier
In order to demonstrate that the new drug is also an innovation, the pharmaceutical
company in question is invited to submit a standardised dossier to the G-BA. The
structure and content of this dossier is presented below. Figure 4 illustrates the scope
and relations of the different modules of the dossier.
Figure 4: Structure of the dossier
Module 1 contains the administrative
information. This is also where the
statements of the dossier are summarised.
The second module includes general
statements about the medicinal product.
Furthermore, the indications are named.
Module 3 contains the appropriate
comparator therapy, the number of patients
with therapeutically significant added
benefits, the cost of the treatment for the
SHIs and the requirements for a quality
assured application.
Module 4 comprises a systematic overview
of medical benefits and medical added
benefits, a description of the methodology
and the results and details of the patient
groups, for which there is a therapeutically
significant added benefit.
Module 5 contains the appendices.
This is where the full text of the cited
sources, files for the documentation of
information gathering, reports of all studies
of the pharmaceutical company, essential
Source: Own Source: Own diagram according to IQWiG, 2013b
Module
1
Module 2
Module 3
Module 4
Module 5
