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Balancing budgets and access to innovation: European payer concerns

20 June 2023

In our current post-pandemic, inflationary environment, the pressures on healthcare budgets continue to grow. In light of this, we asked European payers/payer advisors to provide us with a few key focus areas in their healthcare systems and then discussed “What keeps them up at night?” at an advisory board.

This April 2023 session was the latest in our continuing series of meetings to discuss key market access issues. Advisory board participants included 6 former and current payers/payer advisors from the EU4 and 2 from the UK. Payer profiles included, ex-CEPS and ex-TC payers in France, KV and SHI payers in Germany, ex-regional payer in Italy, national payer advisor in Spain, and ex-SMC and NICE advisors in the UK*.

Payers provided “hot topics” that are currently being debated in their countries and are discussed below, such as:

Budget impact and management of large disease state therapies (i.e., Alzheimer's Disease)
Expensive medication with high uncertainty around clinical evidence (mainly ATMPs)
Changes in PRMA legislation (i.e., Germany Financial Stabilization Act, re-negotiation of Voluntary Scheme for Branded Medicines in the UK)

1. Budget impact and management of large disease state therapies (i.e., Alzheimer's Disease)

Payers are particularly concerned about the launch of therapies for disease states with high prevalence and high unmet need. The size of the population for therapies treating diseases such as Alzheimer's along with the uncertainty about the duration of treatment has potential sizeable budget impact implications for the financial capacity of healthcare budgets. Moreover, requirements for testing and the need for equipment such as PET scanners introduce additional challenges and burden healthcare systems already at a tipping point. Shortages in manpower, capacity, and the need to build and finance healthcare infrastructure to meet growing demand are key concerns.

Our healthcare infrastructure was already strained before COVID. [If] COVID hasn’t broken it, then it's very close to breaking it. Something like the Alzheimer's disease treatment that might be coming would be extremely scary, especially given the infrastructure demands in terms of the potential need for scanners that we simply don't have. And even if we did have more money, we wouldn't have the staff required to go alongside them. You know, some potentially extremely difficult situations coming up like that.

UK ex-SMC advisor

Sooner or later, we have to face that problem here in Alzheimer's disease. And not just the drug, but also the diagnostic cost for a PET scan- and not just one PET scan, but maybe six. Wow. PET scan is not cheap and there is a shortage and a bottleneck. Treatment duration is also a big issue- how long is treatment on average half a year, one and a half years, maybe longer or lifelong, that is still open.

Germany KV member

2. High-cost medicines with high uncertainty around clinical evidence (mainly ATMPs)

Of equal concern to payers is the difficulty in assessing and determining appropriate prices for Advanced Therapy Medicinal Products (ATMPs), which are often introduced in areas with high unmet need, while lacking robust long-term clinical evidence at approval. While political pressure to reimburse these potentially transformative, one-time therapies is considerable, their high price tags combined with immature data sets as well as budget constraints present enormous challenges for payers. New pricing and reimbursement frameworks and payment models that help address these challenges are evolving. However, with numerous such therapies now in the pipeline, payers are bracing themselves for the full impact of what this may mean and how these therapies will need to be assessed and financed.

Our main priority is to keep the budget and this is when the nightmare happens. The high cost of medicines with high impact, mainly ATMPs, and with two products coming this year- Roctavian followed by Hemgenix which are gene therapies for haemophilia and we will need to reimburse simply because I think that, politically speaking, there is no other acceptable solution. And this is precisely why we have changed to outcomes-based agreements with instalment payments for ATMPs

France ex-CEPS advisor

ATMPs are one of the key issues right now in Spain. This is the area where in many cases there is no previous treatment, many products are approved with Phase II, single-arm trials with 25 patients and one year of data. it is difficult to make an assessment and to set the price because the clinical value is unclear due to the lack of long-term data.

Spain’s national payer

3. Changes in PRMA legislation (i.e., Germany Financial Stabilization Act, re-negotiation of Voluntary Scheme for Branded Medicines in the UK)

Reforms being introduced are an attempt by health systems to curb pharmaceutical expenditure but are seen as punitive by industry and thus disincentivize investment. Budget limitations and opportunity costs drive payers’ decisions, especially in the face of uncertainty. Balancing the need to provide access to promising therapies, especially in high unmet need areas is critical, but increasingly difficult with constrained resources. Managing the expectations of different stakeholders and developing sustainable long-term solutions that enable patient access is key.

However, as healthcare systems struggle to cope, access to innovation is often impacted by government decisions that are sometimes politically motivated. Manufacturers must consider these different stakeholder perspectives and goals when mapping their clinical development path for new products. A collaborative approach with payers taken early in the development life cycle of a new therapy is likely to mitigate some concerns.

Because of all the trade-offs, because of all the issues, maybe emotion, especially public emotion is the driver for the political decision more and more. So, it means more volatility!

France ex-HAS member

Beyond the issues highlighted above, we also discussed other important market access topics such as:

Gross to net price differences and net price transparency
Differences in Health Technology assessment criteria, outcome, access, and the implementation of EU-wide Joint Clinical Assessments (JCA)
Market access considerations for high-cost combination oncology therapies
Innovative agreements for ATMPs/cell and gene therapies
Clinical development path in competitive rare disease space with curative options
Evolving European PRMA landscape

We will continue to explore these and other key areas. If you are interested in any of these please get in touch. We plan to discuss these in future blogs/whitepapers and at conferences.

Contact us to learn more!

*Abbreviations: TC: Transparency Committee; CEPS: Comité économique des produits de santé, SHI: Association of Statutory Health Insurance physicians, KV: Kassenärztliche Vereinigung, AIFA: Agenzia Italiana del Farmaco (Italian Medicines Agency), SMC: Scottish Medicines Consortium; NICE: National Institute for Health and Care Excellence


Nekshan Dalal
Nekshan Dalal

Insights to build #FutureReadyHealthcare