The World Health Organization has criticised pharma’s ‘opaque’ policy on drug pricing and says the industry must be more transparent in order to lower the price of new medicines.
A new WHO report found that governments are finding it increasingly difficult to afford new treatments.
The study, released today by the WHO Regional Office for Europe, illustrates the challenges for national health systems and shows that few countries in the WHO European Region have mechanisms in place to evaluate the cost-effectiveness of new drugs.
The report’s authors say that this “hampers the value-assessment and decision-making processes”.
The study found that 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 report points out that countries need to “strengthen co-operation and share their experiences” if transparency is to be achieved and gaps in medicines pricing policies are to be filled.
This echoes the belief of Professor David Haslam, chair of England’s health technology assessor NICE, who last year said pharma had to “show its working” on how it came to a decision on a drug’s price, as at the moment “no-one outside of a pharma firm’s boardroom” knows how this decision is made.
It also comes as the issue of drug pricing is becoming more prevalent, with new drugs for cancer and hepatitis C in particular coming in for criticism for their high costs. Governments across Europe, most notable the UK and Germany, have also in recent years enacted new rules and laws to help curb the rising cost of the drugs budget.
The WHO has also made it clear that pricing was a major issue for the humanitarian group. In 2012, after accepting an extended five-year tenure as the director-general of WHO, Dr Margaret Chan (pictured) said her biggest challenge will be to maintain both the “financial and practical interest in better global health”.
The WHO’s report: 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.
This includes using 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.
- Strengthening collaboration and transparency in policy-making
- Strengthening co-operation between governments, regulators and drug companies
- Giving particular focus to chronic care, specialty medicines and rare diseases.
Zsuzsanna Jakab, WHO’s regional director for Europe, said: “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.”
The number of new medicines introduced in Europe is increasing, in particular for chronic diseases such as cancers, type 2 diabetes and hepatitis C.
The authors says that pharma companies often “aim to charge a higher price for new drugs than for existing ones”, in order to recuperate investment in research and development.
But they say that this is becoming unaffordable for governments across Europe – and add that the the challenge is “even greater” in low- and middle-income countries, where regulation mechanisms are less developed and health systems are weaker.