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Published on 26 August 2011

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An emerging partner? EFPIA offers cost solutions

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Cher Thornhill
Editor-in-chief, HPE

The European Federation of Pharmaceutical Industry Associations (EFPIA) is a little-recognised organisation that self-regulates the pharmaceutical industry in Europe.
At its recent annual meeting, the President of EFPIA, Andrew Witty, said: “Since becoming President, I have ensured that EFPIA listens to its stakeholders and works harder to meet their expectations.

“We have agreed a Leadership Statement to ensure that we act ethically and established a Trust Committee to place building trust at the heart of
EFPIA activities.”

Among the opportunities that EFPIA says it can offer are new ways that ‘financially challenged’ Member States can use to manage their health costs.

Richard Bergstrom, Director General of the EFPIA, said that collaboration of health technology assessments (HTAs) is one of its highest priorities.

In addition to the European Medicines Agency, which offers guidance for the whole of Europe, Bergstrom explained that national agencies perform the same function, despite the substantial extra cost.

“Some countries have agencies like NICE, which is fairly sophisticated in its assessment of value. Others have completely different models,” he said.

“It’s very unpredictable. One will say ‘yes’ and another will say ‘no’ when they’re actually looking at the same data.”
In Sweden, pharmaceuticals need to be approved by the Dental and Pharmaceutical Benefits Board (TLV) to be reimbursed. The corresponding organisation in the Netherlands is the Healthcare Insurance Board (CVZ); the health authority in France is called HAS; and that in Germany, IQWIG.
According to Bergstrom, EFPIA wants this “clinical part of health technology assessment” to become harmonised in Europe and perhaps performed together. In contrast, the costs of different drugs should likely remain a national concern, he says.

The organisation also claims it is taking a leading role in the Active and Healthy Ageing I Ageing nnovation Partnership (AHAIP), an initiative set up by the European Union as part of the wider initiative, the Innovation Union.

The Innovation Union is one of the seven flagship initiatives of the Europe 2020 strategy for a smart, sustainable and inclusive economy.1

“The Innovation Union is an idea to, despite all the financial crisis in Europe, boost Europe’s competitiveness with innovation,” said Bergstrom.

The AHAIP was formed in large part to prepare for the financial impact of the ageing population on our welfare systems, says Bergstrom. EFPIA keenly contributes to the AHAIP, and is represented on the AHAIP Steering Group by EFPIA President, Andrew Witty.

Bergstrom says awareness that people can work more years today, and need to work these extra years to keep the welfare systems working, is much higher in northern European countries, such as Sweden, the UK and Germany, than in southern countries such as Greece, where, he says, awareness and acceptance of this dogma is “very, very limited”.
Another means that the EFPIA says could cut trans-European costs is promotion of patent reform.

“First and foremost, we need to move towards a unitary patent,” said Bergstrom. “We have a patchwork in the patent system. Even if you get a European patent, it’s not enforced collectively. It’s enforced by each country, which means that the courts of each country will review the patent and say whether it is valid or not.

“The cost for liability and for defending your patent is just enormous for the industry. Both originators and those that produce lower price generics believe that we must have a much more robust and predictable patent system.”
The very real need to introduce austerity measures to tackle the financial crisis has been discussed recently by the EU Council of Ministers who concluded that healthcare strategy and related investment in Europe need to be reconsidered. The council emphasised the need to create responsive, efficient, effective and financially sustainable health systems that provide equitable access to health services for all. While acknowledging the fact that economic and other resources are scarce, the council said that investments in health should be recognised as a contributor to economic growth.

The EFPIA claims that it can make a valuable contribution to help countries meet these conflicting needs, by working closely with the authorities in Brussels and across the Member States.
 “We need to be advising governments on what is a good way to keep your budget but support innovation,” explained Bergstrom. “We can’t ask for more money all the time but we need to ask for more money for innovation and less money for other things.” Bergstrom says that the EFPIA has already demonstrated its commitment to work with governments to bridge funding gaps. “We have agreed deals in Ireland, in Portugal just recently, in the Netherlands. We would like to do this as soon as there is a problem,” he said.

According to Bergstrom, the EFPIA can agree price cuts for specific medicines or encourage the use of HTAs, from which the EFPIA can judge what’s innovative – and that they should therefore reward – and what’s not.

“In Portugal, these agreements are under implementation now, which should take down pharmaceutical costs substantially. But it’s done in a way that doesn’t prevent Portuguese patients accessing medicines and in the long run it’s not hurting innovation,” he said.

If HTAs are carried out properly and applied to both old and new medicines, Bergstrom claims they can drive out the use of medicines and procedures that aren’t cost effective.

EFPIA has an ambitious vision for managing pharmaceutical costs across Europe through a relationship based on trust. If Bergstrom’s vision unfolds, Europe could reduce healthcare costs by collaborating HTAs of different Member States, moving towards a unitary patent and working with governments to control budgets while still supporting innovation. The attractive possibility that the EFPIA’s offering could be part of the solution
to our financial needs should be given
due consideration.



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