Germany Announces Policy Shift on Rebates
Late last week, German Health Minister Karl Lauterbach unveiled major reforms across the pharmaceutical landscape that include changes in the statutory rebates and implementing confidential discounts. Originally part of policy reforms to stimulate the pharmaceutical industry, adjusting the rebate regime is just one element of a broader strategic shift designed to improve speed to access without imposing additional expenditure on the German Health system.
The mandatory rebate in Germany stands at 12% after increasing temporarily from 7% in 2023. The latest announcement confirmed the rebate will revert to its previous level pre-2023. Lauterbach announced that it will be possible to negotiate confidential discounts at the national level to replace part of the statutory rebate for drugs not subject to a price reference. Further to this, as part of the recent ALBVGG legislation, the rebate contract rules applicable to antibiotics will be extended to other selected medicine groups such as oncology.
The proposed changes to the discounting regime in Germany make up part of the wide-reaching reforms Lauterbach proposed to revitalize the German pharmaceutical industry. In addition to rebate alterations, Lauterbach also announced the Medical Research Act, the Digital Act and the Health Data Utilisation Act with a focus to increase clinical research and production in Germany, streamline data access, de-bureaucratization of the healthcare system and for the overall promotion of Germany’s pharmaceuticals in European markets. Eli Lilly & Co has already announced its plans to build a new manufacturing plant in Alzey to facilitate further production.
Naturally, the pricing reforms present several opportunities for market access in Germany, with varying impacts for payers, patients and manufacturers. Prices in Germany are often referencing leaders in many European countries referencing systems adding flexibility to pricing strategies without impacting SHI expenditure. Patients will benefit from wider treatment availability. Ultimately, the latest announcements highlight the German government’s recognition of the value the innovative industry plays on the wider health landscape with the need to balance the economic priorities.
There are also challenges; how will the new system integrate for existing post-AMNOG medicines as well as those currently going through the AMNOG process? What about existing submissions that are part of a pan-European launch strategy?
The legislation and full write-up is expected to be published pre-Christmas with a view to action as early as Spring 2024.
Are you considering a product launch in Europe or how this policy shift in Germany will impact your existing portfolio? Are you interested in how the overall policy landscape is changing and how it will present opportunities for market access in Europe?
Get in touch with Decisive Consulting Ltd to explore how we can help navigate your journey through Market Access.
Written by Rob McCaskill and Craig Smith