Patient access and drug pricing initiatives across the world

Pharmaceutical innovation, drug pricing, and patient access to essential medicines must work in a concerted fashion. Factors like:

non-digitised, long, and expensive drug development processes;
unregulated monopolies to patent-protected branded drug manufacturers;
deceptive advertising influencing doctors’ prescribing choices;
markups covering overhead costs, distribution charges, and profit; and
consolidated, non-competitive pharmaceutical market,

end up spiking the drug prices. Such high drug prices force individuals to skip doses, ration medication, or forgo treatment altogether, threatening their health and well-being. This can lead to bigger hospitalization rates, spread of infectious diseases, and poorer health outcomes for the entire population. New brand biologics are introduced in the market at high launch prices and due to abuse of the patent system, year-over-year price increases of brand drugs that face no competition in the market for many years. This results in inequitable access to essential medicines.

Globally, countries are devising and implementing various drug pricing policies and procedures to cope with increasing drug prices. Most countries use a coherent set of policies in combination to determine and manage prices along the supply and distribution chain, and at different time points of product lifecycle. Creating policies on drug pricing and repayment depends on aspects such as health records, competition, and profit margins. Policies and strategies that are most used are the regulation of mark-ups and distribution chains, value-based pricing, external/international reference pricing, pooled procurement, promotion of generic medicine use, and tariff/tax exemptions. Majorly, unchecked mark-ups could bring the flow of supply of drugs to a standstill if the majority of patients cannot afford to buy the drug products.

Below is a list of measures and initiatives taken by countries in the last 5 years to regulate drug prices and ensure accessibility of essential medicines to the patient population:

Country	Measure/Initiative	Objective	Year of initiation	Impact
United States	Inflation Reduction Act – the Medicare Drug Price Negotiation Program	Lowering drug prices and capping out-of-pocket costs for patients to about US$2,000 a year by 2025	2022	Centers for Medicare & Medicaid Services (CMS) announced the first 10 drugs selected for negotiation under the program on August 29, 2023. Based on the current timeline, CMS will publish new prices for the negotiated drugs on September 1, 2024 and expects the prices to go into effect at the start of 2026. According to the current changes, the law empowers Medicare to negotiate prices for 10 drugs in 2026, which may increase to 60 by 2029.
European Union	European Commission’s proposal to revise the EU’s pharmaceutical legislation for more accessible, affordable, and innovative medicines	The European Commission is actively discussing plans to bring medicines to patients in underserved parts of the EU by trimming two years from exclusivity agreements.	2023	The European Medicines Agency (EMA) will provide better early regulatory and scientific support for developers of promising medicines to facilitate the fast approval and help SMEs and non-profit developers.The scientific evaluation and authorisation procedure of medicines will take 180 days as opposed to 400 days.The regulatory burden will be reduced by abolishing in most cases marketing authorisation renewal and introducing simpler procedures for generic medicines and electronic submissions of applications as well as electronic product information.A minimum period of regulatory protection of 8 years for innovative medicines that can be extended up to a maximum of 12 years. The extension is possible in the following cases: if medicines are launched in all Member States, if they address unmet medical needs, if comparative clinical trials are conducted, or if a new therapeutic indication is developed.
Canada	Amendments to the Patented Medicines Regulations	The Amending Regulations, provide the Patented Medicine Prices Review Board (PMPRB or Board) with the additional price regulatory factors (the new factors) of pharmacoeconomic value, market size and the gross domestic product (GDP) and GDP per capita in Canada.	2022	During the interim period, the price of a patented medicine will not trigger an investigation if: its national average transaction price (N-ATP) remains at or below the NEAP (Non-Excessive Average Price) as projected in the most recent compliance letter from PMPRB staff to the relevant patentee, and; its list price does not increase. For greater clarity, an increase in the list price of a medicine will not trigger an investigation if it was taken in accordance with the CPI-based price-adjustment factor during the first filing period of 2022. In cases where the N-ATP of a patented medicine is above the NEAP, the PMPRB will only open an investigation if this results in excess revenues greater than $50,000, as is currently the case.
India	National Pharmaceutical Pricing Authority	Revision in existing ceiling prices of scheduled formulations based on the Wholesale Price Index (WPI).	2022	Under the NLEM, 2022, as of March 31, 2023, the NPPA fixed/re-fixed the ceiling prices of 651 formulations. Price control now extends to medical devices as well. Of these, only four – coronary stents, drug-eluting stents, condoms, and intra-uterine devices – are included in the DPCO 2013 and are, therefore, subject to notified price caps. For the remaining medical devices, which have not been included in the NLEM, the NPPA is entitled to monitor their MRPs and impose sanctions on manufacturers if the prices of the devices exceed 10 per cent of prices prevalent in the preceding 12 months. In January 2019, as a result of an amendment to the DPCO 2013, the Central Government exempted new drugs patented under the Indian Patent Act, 1970, from price control, for five years from the date of their marketing. Further, drugs used for treating orphan diseases (those affecting not more than 500,000 persons in India) were also be exempted from the provisions of DPCO 2013.
China	National Reimbursement Drug List (NRDL)	To improve access to quality drugs. Life sciences companies are aligning their reimbursement strategies to gain access to the National Reimbursement Drug List (NRDL).	2022	The NRDL, which went into effect in January 2022, includes more than 2,800 drugs – more than 1,400 of which are Western-made and the rest from Chinese patents. The average negotiated price decrease across all drugs is 61.7%. China prioritizes domestically produced drugs for the NRDL, but it’s more likely to add foreign manufacturers of rare disease treatments to the list because of a lack of homegrown alternatives. Multinational companies such as Pfizer, AstraZeneca, and Biogen recently reduced drug prices by more than 50% to secure a place on the NRDL. Despite the reduced prices, companies can take advantage of a large population to offset the lower margins. Through this strategy, AstraZeneca expects that new treatments will contribute to about 60% of its China revenue by 2024.

Table 1: Patient access and drug pricing initiatives across the world.

References

Patient access and drug pricing initiatives across the world

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