In general the pharmaceutical world is one of the most regulated sectors there are. Some of these rules are often presented as bottlenecks but they are still helpful to regulate the innovation that is constantly proposed in this sector.
Dr Scroccaro, out of the regulations that are currently available in our country to negotiate the price of drugs which ones could be considered more open?
GS I would not focus so much about the more open regulations but rather on the absence of clear and explicit rules on the criteria that should be followed to determine the value of a drug compared to the other available alternatives. It is necessary to define a reference comparator and to assess the added clinical benefit. Some countries, like Germany, have technology assessment agencies that are responsible to evaluate whether a drug brings added value and also to determine the reference comparator. These data are essential to define the price gap, which should be proportional to the added clinical benefit of the drug. Otherwise the risk is to make a drug that is presented as innovative more expensive than the treatments that are already available without this bringing any real added clinical benefit. Other rules that I consider to be more open concern the determination of the price of the originator medicine compared to the generic one or its biosimilar, when the patent expires and this can be extended by introducing new treatment indications. If the originator is purchased in the hospitals the price gap flattens because a lower cost is one of the winning procurement criteria. However, if it is distributed among affiliated pharmacies the price gap impacts citizens directly and if they are not informed correctly they risk paying more without receiving a better product in exchange. Once a reasonable amount of time has passed to enable the cost of research and development (ten years) to be reabsorbed, the originator medicine should cost as much as the generic one. Another type of open rule concerns the insertion of new treatment indications that are covered by the patent. Once the patent has expired there would not be any reason to keep the irreplaceability of the originator product compared to the generic one for the new treatment indications.
There is a lack of clear and explicit rules on the criteria that should be followed to determine the value of a drug compared to the other available alternatives. It is necessary to define a reference comparator and to assess the added clinical benefit of a drug. — Giovanna Scroccaro
I’ll ask you the opposite thing now. Which regulations do you see as very tight?
GS Those concerning the way to determine the value of tolerability and of how easy it is to administer the drug. These are important parameters that impact the quality of life of the patient and the treatment adherence but they are secondary in the assessment process of a drug as they are not explored much. The evaluation of the drug focuses mainly on its clinical effectiveness. Even in cases where a drug might have equal effectiveness but greater tolerability compared to another treatment this aspect is not valued enough.
What obstacles can one come across when implementing national regulations locally or regionally? How do the regional segmentation of the market and the different rules you might come across between different Regions fit with the need to guarantee equal right to health throughout the country?
GS When a drug is approved for the redeemability scheme it should become accessible to all citizens anywhere in the country. What the Regions could and should do is to establish a route to access that drug rather than to reassess its value. Therefore they hold a complementary role rather than a substitutive one. For example, the Italian Medicines Agency (AIFA) asks Regions to identify the prescribing centres, especially when it comes to more innovative and expensive medicines. The Regions can select a limited number of prescribing centres (those with the best expertise) and these can work in a network comprising other “satellite” centres so that every patients waiting to be treated can be reached and issues such as transfers can be avoided. The Regions can set up different routes with more or less centres and with or without the support of telemedicine and teleconsulting systems. They can also put in place guidelines on prescribing behaviour to advice doctors on the drugs with the best benefit/risk and cost/benefit profile. If there are more medicines available for the same condition the Region cannot favour one over another but it can indicate the treatment strategy that is deemed to be more effective and sustainable. A workgroup of clinicians and experts in the field draws up the indications in order to create guidelines by using approved methods such as the Grade one. All of these operations do not interfere with the central regulatory policies nor do they limit the access to the medicine via local healthcare services, especially when it comes to an innovative drug.
Professor Genazzani, what advantages do the European regulations bring during an emergency context like the one we are currently going through? How can we reconcile the rules that are made centrally with the individual national contexts that have heterogeneous healthcare and socio-healthcare systems as well as different economic conditions?
AG The Covid-19 pandemic confirmed the importance of making decisions on extraordinary measures through a central system. The European Medicines Agency (EMA) responded to this challenge with great enthusiasm and professionalism. Being able to make shared decisions and follow agreed timelines was providential to face the healthcare emergency in such a heterogeneous area like Europe, which unites such diverse countries. Not every country would have managed to face the situation on its own. Socioeconomic conditions vary from country to country and this is certainly an obstacle because the decisions that are made centrally need to be implemented in the various different contexts and organisational systems. For example, vaccinating 500 thousand people in Malta is not the same as vaccinating 56 thousand people in Italy. However, we should remember that England tried to do things on its own and even though on one hand it achieved some goals really fast on the other hand it struggled quite often.
Would the centralisation of the purchase and distribution of medicines at the European Union level guarantee a more equal and transparent negotiation of the drug price?
AG I believe that a centralised negotiation of the drug price would be advantageous when the demand is much higher than the offer, which is what happened with the vaccines against Covid-19. In this context the bargaining power of the European Union around the provision of doses to almost 450 million citizens is undoubtedly greater than that of individual Member States. If each country negotiated independently we would not have achieved the same conditions and, most importantly, we might not have obtained the same amount of vaccines, which are also distributed equally. It is a different story when the offer is greater than the demand, for example with traditional drugs. I am afraid that in that case a centralised negotiation might not be best solution, as it would benefit some Member States and penalise many other ones, given the strong significant economic heterogeneity there is. Furthermore, apart from some exceptions, such as the case of ultra-rare diseases, it would be unrealistic to try and negotiate centrally a drug price that can be sustainable for every Member State. I don’t think it would be a feasible operation. Today we have a structured and tested system in place where each party has its well-defined role. A central European agency assesses the absolute benefit/risk ratio, the individual national agencies evaluate the relative benefit/risk ratio and the Regions focus on the organisational aspects of these benefit/risk assessment and the comparative aspects. Then there are the individual prescribers and hospitals that assess the benefit/risk for the individual patients. I don’t think the system is so complex that it should be simplified, as some seem to think.
Being able to make shared decisions and follow agreed timelines was providential to face the healthcare emergency in such a heterogeneous area like Europe. Not every country would have managed to face the situation on its own. — Armando Genazzani
How should that grey area concerning drugs that are not innovative but that bring some added value compared to the previous ones be regulated? Should the same rules be utilised or should different ones be made?
GS I reiterate what I said when I answered the first question. If there is no added value compared to the alternative treatments that are already available the drug should not cost more- all the opposite, it should have a competitive lower price so that a greater number of patients can access it. If there is a minimal added value then you should determine a premium price that is proportional to the nature of the added benefit. Either way you should begin by making a comparison with what the market is already offering.
AG The pharmaceutical market has its own peculiarities but it is not so different from all the other markets. If a new drug does not differ significantly from those that are already on the market its cost should eventually be similar and the market would then determine the sale dynamics. Another aspect that can make a difference is the amount of competitors there are. Having two, three or four drugs enhances the healthcare system, even if they might be quite similar between each other: the more alternatives there are the easier it is to make the right treatment decision for individual patients and the more efficiently a country can negotiate a price on behalf of taxpayers. However, when there are too many alternatives, the addition of a new drug might be superfluous. This varies on a case-by-case basis. Generally speaking that is the case except- maybe- for a scenario I am not currently very clear on, which is when a new drug that is not too different from the generic ones already on the market has to be registered. On one hand it would not be sustainable for the company to negotiate a price for its patented drug based on the cost of the generic counterpart. On the other hand it would be unwarranted to ask taxpayers to pay much more than that. In such cases, it is difficult to put in place some form of mediation but I can’t think of a simple solution either. It is plausible that this new drug could have value on the market but if its price is significantly different than the one of the generic drug then it should be managed based on appropriateness and the patients that will benefit from it compared to alternative treatments should be included. I am afraid that the quality of the registration trials is not always able to provide such solutions.
There is much talk around the use of real world data. What rules should be followed to integrate these data to the process of establishing drug prices?
GS Many ask this question. It is difficult to imagine that the price of a drug would be reviewed and increased based on the new data that are collected after the drug has been registered. In a situation where the drug did not come with strong data on its added value when the decision to cover its cost was made and a few years later a greater clinical benefit is discovered- through a new trial or real world data- the price cannot be increased. Even though the cost would remain the same, as no extra premium would be awarded, the consumption of the drug would change. If the real world data will show a clinical benefit prescribing clinicians are likely to pick this drug over other ones so the company would get a financial return anyway.
AG First of all you should assess the quality of the real world data you are presented with. These should be collected in the same systematic way that would be required in clinical trials and with a clear objective, knowing what you are looking for. If there are no solid methods it is inconceivable to collect data on efficacy during the post-marketing phase. Having said that, you should also think about what these data are for. Do you need them to increase the price of the drug should this be shown to be more effective than previously demonstrated and to reduce it in the opposite scenario? Or to obtain the highest price and promise to demonstrate the clinical benefit through real world data? It is not clear what strategy we are aiming for. Perhaps we should talk about clinical trials that are conducted well instead of real world data.
You need to at least follow the minimum standards in order to establish whether a drug works. Without stringent testing you cannot make claims on the presumed efficacy of drugs that are presented as “miracle treatments”. — Giovanna Scroccaro
The Covid-19 pandemic pushes you to conduct testing and approvals of new vaccines and drugs more quickly. What changes should be made to the European and national regulatory policy in order to enhance innovations during an emergency context?
GS In the midst of the epidemiological emergency the EMA and the AIFA had to create less exhaustive dossiers due to the urgent need to have a drug available. I think that is a correct policy to follow because the assessment of the profile of a drug does not stop when this is introduced on the market. Thanks to pharmacovigilance it is possible to collect a great amount of up-to-date data on the safety profile and on the efficacy/safety ratio, which regulatory affairs keeps into consideration. Therefore it is about making decisions based on a dossier that might be limited at the beginning but that is continuously updated and integrated with new data later on; and the regulatory authority intervenes immediately in case there is the need to change any application aspects. What should never happen instead is to back up anecdotal experiences on the alleged efficacy of drugs when this was demonstrated only after treating tens of patients and without following any research method- the AIFA has a very firm stand in this regard, which I agree with. You need to at least follow the minimum standards in order to establish whether a drug works. Without stringent testing you cannot make claims on the presumed efficacy of drugs that are presented as “miracle treatments”.
AG The EMA already put in place some accelerated procedures in order to speed up the process to approve new treatments but such accelerated procedures do not always work in Italy. What we have learned from the pandemic is that you need to be fast but in order to achieve that you have to have more people participating to the assessment. In order to create a process for early access the AIFA should increase its own workforce and be able to involve external professionals, which would mean managing conflicts of interest appropriately- this currently represents a complex issue both from a formal and informal point of view. Professionals do not always understand that a conflict of interest is something important in the context of an independent assessment of a drug. We all think we are completely free from external influences but then we realise we would have made different decisions in other contexts. I believe it is very important to increase the number of staff. Early access represents a complex topic that requires an assessment of what is deemed innovative and what is not; it also requires a fair price to be determined because for innovation to be considered innovation it needs to be accessible. I think this topic is being discussed internally at the AIFA and the goal might be within reach.
Early access represents a complex topic that requires an assessment of what is deemed innovative and what is not; it also requires a fair price to be determined because for innovation to be considered innovation it needs to be accessible but also to be valued in financial terms. — Armando Genazzani
Would a regulation at a global level be conceivable? Which parties would need to be involved for that?
AG This is actually a double question on two different matters. The first question is whether we need a regulation at a global level, which we already partly have. For example, the European Union, the United States, Japan and Australia adopted the same drug registration dossier model and this speeds things up, resulting in patients being able to access medicines faster. Then there is the International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (ICH). This puts together the authorities responsible to create the regulations of some countries and the representatives of the drug industry to establish shared standards for the registration of pharmaceutical products in order to avoid duplicating work as much as possible during the data processing procedures and to speed things up. As the pandemic demonstrated, in the European Union it is much easier to approve the use of a vaccine that was developed in an ICH country compared to one that was made elsewhere. That is not due to geopolitical factors- as many seem to imply- but the fact that there are shared rules within the ICH. Therefore a form of global harmonisation has taken place but part of the world is currently unable to support the adoption of new and shared standards and it should be put in the condition to be able to do so. The second question is whether you need action at a global level when the treatment of the entire world population is the priority for individual countries. It would make me smile when the Presidents of the Italian Regions used to claim that they would buy vaccines in order to vaccinate their Region on their own. The omicron variant from South Africa confirmed once again that we will be able to end this pandemic only when the entire world population will be vaccinated. Therefore we need to speed up the process to access medicines and vaccines on a global scale while financially supporting poorer countries. We partly did this (though we were late) for the HIV epidemic in Africa. Now we need to find the way to guarantee the provision of vaccines to the entire world population.
GS I would make an harmonisation attempt by mentioning that the EuneHTA European network has reiterated several times the need for a European assessment of the added value. The EMA expresses an opinion on the value of a drug but not on the added clinical benefit in comparison with the treatments that are already available. Individual Member States are responsible to determine this aspect when a European network of agencies could do this instead, thus avoiding the duplication of data analysis and sharing this comparative assessment. Having a single HTA dossier would speed things up and would not represent a restriction on the price negotiation for the individual Member States. Ultimately today decisions are already being made looking at the statements of other national agencies…
The parties that have to deal with the rules governing the pharmaceutical sector (drug companies, prescribers and patients, etc.) often complain about not being involved enough. How could you promote dialogue without risking to be overly influenced in one direction or another?
GS During the assessment process it would be important to dedicate some time to sessions with the stakeholders, especially patients, so they could discuss issues or highlight any unmet needs and bring a different outlook on things compared to those assessing the dossiers. Listening to them does not necessarily mean making decisions based on what they ask for. However, I know that it is easier said than done and you would need to be very cautious around potential conflicts of interest. Each stakeholder should express their point of view by stating their intentions and goals clearly.
AG The communication with all the stakeholders- scientific societies, doctors, patients, pharmaceutical companies and professional associations- is crucial in any field. I am not worried about influencing and conditioning mechanisms, as the stakeholders are there to clarify a position. That is the case both for the negotiation on an individual drug and the policy side of things- meaning the creation of great rules that are well defined- because in the absence of communication the regulator and the regulated end up making big blunders. I see no harm in having scientific debates on specific topics or drugs with the industry, or in the AIFA potentially opening the individual dossiers in the presence of the pharmaceutical company so that the latter can make its case on that drug. However, I have the feeling that the stakeholders are not really asking to be involved during the preliminary phase but rather to be able to make decisions. The responsibility of making a decision should not be shared between multiple parties though. The decision makers should not have their own specific agendas, even when this might not be necessarily related to financial profit. Nevertheless, a project on the transparency and involvement of the stakeholders in the decision-making processes should still be promoted. As I said, in order to speed things up you need to increase the number of staff working in regulatory affairs. In Italy one of the bottlenecks is indeed represented by the low number of workers of the agency that is involved in the decision-making process that concerns access to medicines.
Edited by Laura Tonon