AMNOG - Germany's Healthcare Reform and The impact on Global Pharmaceutical Market Access Strategies

The Impact of AMNOG on
Global Market Access Strategies
IHS Webcast, 28 June 2011
Gustav Ando, Director, Healthcare and Pharma
Gaëlle Marinoni, Senior Healthcare Analyst
Anne-Charlotte Honore, Healthcare Analyst

The Impact of AMNOG on

IHS Webcast, 28 June 2011

View the on-demand replay of this webcast

Copyright © 2011 IHS. All Rights Reserved.

Agenda

 AMNOG At A Glance

 Impact on National and Global Market Access
Strategies

 Impact on Research and Development
Programmes

 AMNOG From An International Perspective

 Concluding Remarks

Copyright © © 2011 IHS. All Rights All Rights Reserved
Copyright 2011 IHS Global Insight. Reserved.

Methodology

 Analysis based on primary and secondary research
 Telephone interviews with 2 policy makers and regulatory affair
specialists, 5 industry representatives with extensive experience in
planning and executing pharmaceutical launches
 Conference and workshop attendance
– Market Access in Germany after Major Pricing & Reimbursement
Reform, 14-15 March 2011, Berlin, Germany
– ISPOR 16th Annual International Meeting, 21-25 May 2011,
Baltimore, Maryland, USA
 Desk-based research: national governmental agencies, IHS Global
Insight Healthcare and Pharmaceutical services (World Markets
Healthcare and World Markets Pricing and Reimbursement).


German Healthcare Reform At A Glance

 Early benefit assessment for eligible new market entrants and selected
established medicines
 End of free pricing after 6 or 12 months of commercialisation
 Price negotiations, or
 Reference pricing
 Limited recourse to cost-benefit assessment
Registration 0 - 3 Months 4 - 6 Months 7 - 12 Months 13 - 15 Months
Process

Product
Additional Price
Launch Discounted Price
Patient-related Negotiation
Outcome with GKV
Submission of
Reimbursement Cost-benefit
Early Benefit Arbitration
Dossier Assessment
Assessment body
by IQWiG
(G-BA)

No Added Reference Discounted Price
Free Price Value Pricing


Early Benefit Assessment

 Eligible Medicines:
– Based on formulation and revenues for new market entrants
– Based on new approved indication or G-BA/industry request for
established medicines

 Exceptions:
– Orphan drugs launched post 1 January 2011 with expected 12-
month turnover in all indications lower than 50 million euro (retail
prices inclusive of VAT)
– Hospital-only medicines
– Reimbursable new active ingredient with estimated budget impact
on Statutory Health Insurance of less than 1 million euro


Early Benefit Assessment

 Scores:
– Major additional therapeutic benefit
– Significant additional therapeutic benefit
– Slight additional therapeutic benefit
– Additional but unquantifiable therapeutic benefit
– No demonstrated additional therapeutic benefit
– Less therapeutic benefit than appropriate comparator

 Outcome:
– Pricing negotiations
– Inclusion into the reference pricing system


Pricing Process Under AMNOG

 Three pricing options under AMNOG
– Pricing negotiation
– Arbitration
– Cost-benefit evaluation
– Global repercussions through international reference pricing


AMNOG Impact on National and

 A medicine’s innovation level will influence market access
strategies at the local and global level
 Achievable German added therapeutic benefit score will
influence:
– Launch timing in Germany
– Market entry price in Germany
– Discounted price in Germany
– Launch Sequence

 Market access strategies and launch sequences should
be planned based on maximum achievable global product
revenues

Case Study: Market Access Strategy
for Highly Innovative Market Entrants
 Objective: Maximise global product revenues
 Strategy:
– Early German and International launch
– German market entry with high (yet reasonable) price to impact international
prices through reference pricing
– Favourable early benefit assessment could positively impact global
reimbursement decisions and influence global prices
– Upon pricing negotiations, the German price is expected to be at worse the
European average price. Global prices remain in high range
Launch Year 1

Discounted Price (at worst average
Free Price GERMANY
price in nominated countries)

International prices positively Global prices remain in
impacted by high German price high range GLOBAL


AMNOG Impact on Clinical Trial Design

 Challenges:
– Meet information needs of regulators and payers:
 Endpoints need to integrate patient-relevant outcomes
 Clinical trial design

 Therapeutic benefit score based on relative efficacy or
relative effectiveness data:
– Ideally head-to-head comparison or:
 Meta analysis
 Sensitivity analysis
 Subgroup analysis and other effect modifiers
 Indirect comparison
– Surrogate endpoints not accepted, except for oncology drugs
– Randomised clinical trials preferred
– German-specific data

Possible Clinical Trial Protocols

 Clinical trial protocols:
 Randomised, two-arm, active-controlled, superiority trial
 Randomised, two-arm, active-controlled, non-inferiority clinical trial
 Active- and placebo-controlled randomised clinical trial
 Pragmatic clinical trial
 Common reference indirect comparison based on RCT information
 Observational studies
 Adaptive design, three –arm, randomised clinical trial

 Appropriate comparator:
 Utilisation criteria: standard therapy in Germany
 Not limited to pharmaceutical treatments


AMNOG: An Innovative Reform?

 Therapeutic benefit score déjà vu:
– E.g. in France, Austria, Switzerland, Italy, Japan
Table: German Therapeutic Benefit Scores – Comparison with France and Switzerland

Germany France Austria
Major added therapeutic Major therapeutic advance – Substantial added therapeutic
benefit ASMR I benefit
Significant improvement in Great improvement in Added therapeutic benefit
efficacy or side effects efficacy or side effects –
ASMR II
Slight but not minor Modest improvement but Similar to current standards
improvement in efficacy or added value – ASMR III
side effects
Additional but unquantifiable Minor improvement with
added therapeutic benefit slight benefit – ASMR IV
No demonstrated added Similar products including
therapeutic benefit generics – ASMR V
Less therapeutic benefit than
comparator


AMNOG: An Innovative Reform?

 Perceived level of innovation as a driver of price: also déjà vu
– E.g. in France, Austria, Switzerland, Italy, Japan
France
ASMR ratings I, II and III • Pricing negotiations: price typically fixed at the reference country average
ASMR rating IV • Pricing negotiations: price typically set just above that of therapeutic comparator(s)
ASMR rating V • Price set below therapeutic comparator(s)

Austria
Substantial added therapeutic benefit • Prices based on average EU prices (EU25)
Added benefit in the majority of the patient population • Price set at most 10% above that of therapeutic comparator
Added benefit in a defined patient sub population • Price set at most 5% above that of therapeutic comparator
Similar to current standards • Price set at least 10% below that of therapeutic comparator

Germany
Major, significant, slight, and • Pricing negotiations: algorithm in development
additional but unquantifiable • Under the arbitration process, the price is expected to reflect European price
None demonstrated • Price set at the price of the appropriate therapeutic comparator
• Comparator ideally be included reference pricing system
Below comparator • Price can be set below that of the appropriate therapeutic comparator(s)
• Usage restricted via G-BA's prescription guidelines

Concluding Remarks

 AMNOG brings price control to one of the last unregulated
European pharmaceutical market

 AMNOG brings a never-seen-before level of transparency
to the pricing and reimbursement process

 AMNOG increases market access barriers, especially for
products with limited added therapeutic benefit

 AMNOG is expected to affect launch sequences and
global R&D


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AMNOG - Germany's Healthcare Reform and The impact on Global Pharmaceutical Market Access Strategies

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