pharmaceutical policy
prepared by the
Ministry of Social
Affairs and Health
The G10 Process of the EU aims to improve the competitiveness of the pharmaceutical industry, while taking account of public health concerns. The challenge is to identify and reward innovations and at the same time contain the growing medicine costs.
1. Increasing information and utilizing statistics
• It is important to know the relative effectiveness of a medicine (therapeutic added value of a medicine compared to a comparator and considered in relation to the costs incurred by the medicine) when the pricing, reimbursement and use of the medicine are contemplated.
Reviewing the relative effectiveness of medicines is one of the tasks of the EU G10 High Level Group on Innovation and the Provision of Medicines. Project funding within the EU Public Health Programme could be used to finance projects related to this issue.
• Utilization of the health insurance statistics and the research of the Social Insurance Institution of Finland (SII): analysing the background of the growth of pharmaceutical expenditure, the development of health care expenditure as well as the consumption of medicines according to illnesses, medicine groups and regions. The statistics provided by SII facilitate accurate analyses according to regions and (groups of ) physicians with regard to prescription practices. The Research Department at SII intends to analyse the reasons behind the growth of pharmaceutical costs according to medicine groups (whether cost increases within a certain medicine group are caused by, for example, a transition to expensive medicines or an increase in the number of users). The present feedback data collected by Kela on prescription practices can be developed by enclosing guidance on how to use the medicine, for example.
2. Rationalization of prescription practices
• The ROHTO will continue to develop the operation forms presently under construction. However, it wants to be able to modify its practices if necessary. The ROHTO workshops review each medicine/illness group, including pharmacotherapy costs, with the aim of creating a code of conduct for pharmaceutical practices that have cost effects and of following up whether this code of conduct is adhered to. Cost comparisons that are a part of the national Current Care guidelines will be included in printed material; electronic recommendations will be linked to information on costs. An electronic decision-making support system will suggest the least expensive medicine suitable for the patient.
This system will also be linked to Current Care and cost data. Kela’s feedback system for physicians’ prescription practices will be developed.
• A regular total review of pharmacotherapy will be launched, in particular multiple-medicine use by the elderly needs to be examined.
The attending physician bears responsibility with support from a team of other professionals.
3. Medicine reimbursement system
• The reform of the medicine reimbursement system and the 5% cut in wholesale prices came into effect on 1 January 2006.
• The definition of the 0 refund category excludes certain medicines and groups of medicines from the reimbursement system (including medicines for temporary minor illnesses as well as hypnotics).
• The grounds for reimbursement will be examined in light of international experience in order to create an RP model applicable in the Finnish system to facilitate increased competition between pharmaceutical companies. It will be easier to incorporate an RP price system in the reimbursement system as the latter was simplified in early 2006. A working group at the Insurance Department at the MSAH will complete its work in early 2007 with the purpose of incorporating the proposal into the next government programme.
• Under an RP system, an authority defines the medicines belonging to a specific group and determines a reference (or reimbursement) price for it. Such a group can consist of products with the same active substance;
containing active substances that belong to the same medicine group;
or with the same therapeutic effect. The price of an individual medicinal product can be higher than the RP, but a patient purchasing the product is reimbursed solely on the basis of the RP. The difference between the RP and the actual price is borne entirely by the patient. This system is intended to encourage the prescription and use of cheaper generic drugs.
4. Pharmacy system
• The pharmacy fee that evens out the variations in financial performance of community pharmacies will be replaced by a new method of securing a comprehensive system of community pharmacies that does not raise medicine prices and allocates effective support to pharmacies in need.
The proposal will be included in the next government programme.
• In 2004, the NAM proposed that the pharmacy fee should be halved and that the future of the community pharmacy network should be secured primarily by developing the system of subsidiary pharmacies.
One option is an internal adjustment between the pharmacies where bigger pharmacies finance a fund to support smaller pharmacies. In this way support would not circulate from one pharmacy to another and medicine prices would drop by 7%. If the present adjustment system is preserved for longer, it will be assessed whether private pharmacies will have to pay their pharmacy fee in advance (at present, the fee is paid in the following year).
• The drug tariff determining the sales margin of a pharmacy will be revised to correspond with the present medicine price structure. During 2006, the drug tariff will be made more regressive than at present.
It will also become fixed-term. According to the preliminary proposal by NAM, the pharmacies’ profit would have been cut by €8 million in 2003. A ceiling for the pharmacies’ sales margin is being considered.
5. Financial responsibility for medicines
• Proposals for solving the problems created by the two-way financing of medicines are being considered. In spring 2006, the health and insurance departments at the MSAH appointed a rapporteur to make proposals concerning a revision of the guidelines or legislation on financial responsibility and, if necessary, to propose other potential measures such as a further review of the financial system for medicines.
• In outpatient and private health care patients and the health insurance system pay for the medicines elsewhere medicines are financed by municipal health care. This causes confusion about the financier, variations in practices and cost transfers to other parties as well as inefficiency. In the present system, physicians prescribing the medicines have little interest in influencing drug costs in outpatient care.
6. Constraining the growth of pharmaceutical expenditure to a percentage agreed beforehand
• In the budget framework, the growth of total expenditure has been confirmed to be no more than 5% per year. The growth percentage would be based on, for example, Kela’s assessment of the effects of demographic change on the growth of expenditure. If the measures explained in this memo are not sufficient to ensure that the growth of expenditure remains within the defined framework, further measures
should be examined. These could include, for example, medicinal-product specific agreements (in particular for expensive medicines and medicines with no established use) which would require a pharmaceutical company to refund the surplus or cut the price of a medicine when a certain reimbursement sum is exceeded.
7. Marketing
• Influencing pharmaceutical companies’ marketing practices: in 2006, NAM conducted a survey on international regulations and policies regarding pharmaceutical marketing. On the basis of the survey, certain measures such as a revision of provisions and/or tightening of supervision will be considered.
8. Assessment and further work concerning the proposals presented in the OECD Country Review for the development of pharmaceutical services
• In 2006, the health and insurance departments at the MSAH, as well as Kela, conducted a survey regarding intermediate forms between information steering and the physician-specific drug budgets proposed by the OECD. One solution could be drugs budgets for health-care centres or hospital districts in the context of the present financing system for medicines. The drugs budget would be either directive or binding and it would include incentives such as the possibility of using the savings on pharmaceutical expenditure for other tasks. The specific characteristics of occupational health services and the private sector would be taken into consideration.
9. Pharmacoeconomic research
• Possibilities to intensify pharmacoeconomic research are examined.
Also the possibilities of incorporating this research into political decision-making are studied. Financing may be available from the rehabilitation resources of Kela.
10. External rapporteur
• In spring 2006 Professor Elias Mossialos, an international expert on health economics, prepared proposals on assignment by the Health Department at the MSAH regarding measures that Finland should take in order to contain the growth of pharmaceutical expenditure, in light of international experience.
11. Common forum for different stakeholders
The MSAH held a seminar where different stakeholders came together to consider different ways to contain pharmaceutical expenditure.
Finnish Competition Authority (FCA) – Mr Jan Nybondas
– Mr Martti Virtanen – Ms Liisa Vuorio
Finnish Medical Association (FMA) – Mr Pekka Anttila
– Mr Risto Ihalainen – Mr Markku Kojo
FinOHTA (Finnish Office for Health Technology Assessment) – Mr Antti Malmivaara
Finnish Pharmacists’ Association (FPA) – Mr Harri Ovaskainen
– Ms Inka Puumalainen
Kela (Social Insurance Institution) – Mr Mikael Forss
– Mr Timo Klaukka – Mr Pekka Koivisto – Mr Timo Maljanen – Ms Jaana Martikainen