New WHO report shows that transparency and cooperation help to reduce high prices for new medicines

Copenhagen, 26 March 2015

As the number of new medicines introduced in Europe rises, governments are finding it increasingly difficult to afford them, according to a comprehensive study released today by the WHO Regional Office for Europe. The study illustrates the challenges for national health systems, with specific examples, and shows that few countries in the WHO European Region have mechanisms in place to evaluate the cost–effectiveness of new drugs; this hampers the value-assessment and decision-making processes.

Both the supply and prices of new medicines are often fixed in framework agreements between governments and pharmaceutical producers and the negotiation process is generally rather opaque. The study points out that countries need to strengthen cooperation and share their experiences if transparency is to be achieved and gaps in medicines pricing policies are to be filled.

The report, entitled Access to new medicines in Europe: technical review of policy initiatives, opportunities for collaboration and research, features findings from 27 countries and explores different ways that health authorities in European countries are dealing with high spending on new medicines, including methods such as restrictive treatment guidelines, target levels for use of generics, and limitations on the use of particularly expensive drugs. It also outlines possible policy directions and choices that may help governments to reduce high prices when introducing new drugs.

"Our objective is to help countries to define their priorities so that they get the best out of the investment they make in new medicines. But the ultimate goal is to protect patients' interests and to ensure that they are not provided with expensive new medicines that offer little or no improvement in health outcomes," says Zsuzsanna Jakab, WHO Regional Director for Europe.

The number of new medicines introduced in Europe is increasing, in particular for chronic diseases such as cancers, type 2 diabetes and hepatitis C. Pharmaceutical companies often aim to charge a higher price for new drugs than for existing ones in order to recuperate investment in research and development. It is proving increasingly difficult for governments to keep up with the high price tag while maintaining a balance between access and cost–effectiveness. Governments across Europe are facing similar problems, but the challenge is even greater in low- and middle-income countries, where regulation mechanisms are less developed and health systems are weaker.

The report includes a number of key directions for the future, including:

• strengthening cooperation between governments, regulators and drug companies;
• strengthening collaboration and transparency in policy-making;
• giving particular focus to chronic care, specialty medicines and rare diseases.

"It is encouraging that new medicines are being developed but national health authorities have to be sure, when taking decisions on purchasing newly developed drugs, that the price reflects the therapeutic results," says Hanne Bak Pedersen, Programme Manager, Health Technologies and Pharmaceuticals, WHO Regional Office for Europe. "Our report explores trends, practices and evidence that can increase transparency and help governments to negotiate better with the industry to lower the prices of new drugs."

The Regional Office partnered with the following agencies and WHO collaborating centres to produce this report: Emilia-Romagna Health and Social Care Agency; Gesundheit Österreich (GÖG); Karolinska Institute; London School of Economics and Political Science; Organisation for Economic Co-operation and Development (OECD); and the governments of the Netherlands and Norway.