Reference price systems: stakeholder dialogue and involvement

Generics and Biosimilars Initiative Journal (GaBI Journal). 2012;1(3-4):114-5.
DOI: 10.5639/gabij.2012.0103-4.031

Published in: Volume 1 / Year 2012 / Issue 3-4
Category: Editorial
Page: 114-5
Visits: 10772 total, 3 today
Keywords: generics policies, health professionals, patients, reference price system, reimbursement

Dylst et al. provide a detailed overview about the characteristics of reference price systems in Europe and discuss their possible impact. The role of stakeholders in the implementation of this policy measure requires further attention.

Submitted: 16 September 2012; Revised: 17 September 2012; Accepted: 19 September 2012; Published online first: 21 September 2012

Dylst et al. show that a reference price system is a broadly used policy in European countries: the majority of the EU Member States have implemented such a system [1].

A key sentence by Dylst et al. is: ‘Unlike its name suggests, a reference pricing system is not a pricing system, but in fact a reimbursement system.’ This statement is key and contributes to a better understanding of this policy. The authors correctly define a reference price system as ‘a system that establishes a reimbursement level or reference price for a group of interchangeable medicines’: terminology clarity is important also because reference price systems are sometimes confused with a pricing policy called external price referencing. That policy is a ‘practice of using the price(s) of a medicine in one or several countries in order to derive a benchmark or reference price for the purposes of setting or negotiating the price of the product in a given country’ [2], and it is also very common in European countries [3].

As a reimbursement policy, a reference price system requires a specific design, in particular with regard to the clustering of the reference groups and the definition of the reimbursement limits (reference limits). The article describes the different approaches to organizing the reference price systems in the European countries and their possible consequences. Dylst et al. highlight that different approaches are recommended for different environments: while, in principle, the relationship ‘the lower reference price, the higher savings’ appears logical, there are settings, particularly in developing generics markets, where a higher reference price appears to achieve better results. A general lesson for policymakers can be drawn: when implementing policy measures, the context needs to be taken into consideration, and, though it is important to learn from the experiences of other countries, successful policy measures cannot be simply copied from one country to another but have to be adapted to the country specific environment [4].

Further, good timing and implementation planning is important when this policy measure is introduced or further developed. Regarding generics substitution, World Health Organization strongly recommends introducing this policy as a voluntary measure, i.e. legal framework allowing it; then encouraging it, e.g. via incentives, and in a final stage having mandatory generics substitution [5]. The implementation of a reference price system should follow a similar approach: the clusters should be defined in a more limited way in the beginning [Anatomical Therapeutic Chemical (ATC)-level 5] and can, after experience is gained, be broadened over the course of time (to the ATC-level 4 and even ATC-level 3).

This approach is recommended firstly because it facilitates the technical process for the staff administrating the system and secondly because stakeholders are more likely to accept the reference price system during a phased introduction. The stakeholder aspect was not addressed by Dylst et al. However, bringing stakeholders on board, as early as possible, is a major prerequisite for a successful policy implementation. The implementation of a reference price system, particularly when introduced in connection with generics substitution and/or with prescribing by the international non-proprietary name, may raise concerns to physicians who might be concerned about a loss of their ‘therapeutic freedom’. A good communication policy could facilitate the acceptance by stakeholders of the measures introduced. A study from Greece suggested that doctors would be willing to prescribe more generically if there was a clear generics promotion policy [6]. Having said this, it must be pointed out that the reference price system is a policy which has the potential to increase possible conflicts between prescribers and pharmacists. Nonetheless, good practice examples exist: a successful cooperation between the two groups was reported from Denmark where pharmacists and prescribers stressed the importance of having a clear understanding of their roles in the system which they consider as complementary and not conflicting [7].

Dialogue and information are therefore both of major importance also, and especially, when addressing the concerns of patients. In a study performed to explore prerequisites for successful implementation of a reference price system in Austria [8] (where it has yet not been introduced), case studies highlighted that in some European countries difficulties were encountered after the introduction of a reference price system because rumours about the low quality of generics had been spread and were not responded to appropriately. As a result, patients were confused and concerned.

Dylst et al. also addressed the issue of socio-economic equity concerns related to reference price systems. Though there are few studies on this topic available, evidence could dispel concerns about possible inequity. In fact, patients might even become strong partners in supporting generics policies. They have the purchasing power to ask for generics if incentivized to do so. But they need to understand the policy. Therefore, a policy providing clear information to patients about the function and benefits of a reference price system and about generics in general is required.

Reference price systems have been introduced in several European countries as a reimbursement policy. All of these have a publicly funded health and pharmaceutical system (either social health insurance or national health service). A recently published article on pro-generic drug policies in low- and middle-income countries (LMIC) also described reference pricing systems [9]. Because of the continuing investment into insurance systems in LMIC, reference pricing systems are a policy option that must be explored by these countries. The prerequisites for successful implementation (appropriate design of the system, stakeholder involvement, and an information policy) are the same as in European countries.

For patients

The editorial refers to the article of Dylst et al. whose findings suggest that reference price systems generate savings for healthcare budgets in the short term without a negative impact on the health of patients. This editorial highlights the role of stakeholders, including patients. Patients can become strong partners in supporting reference price systems and other generic drug policies but they need to have a good understanding of the policies. Therefore, a policy providing clear information to patients was stressed as key in the editorial.

Competing interests: None.

Provenance and peer review: Commissioned; internally peer reviewed.

1. Dylst P, Vulto A, Simoens S. Reference pricing systems in Europe: characteristics and consequences. Generics and Biosimilars Initiative Journal (GaBI Journal). 2012;1(3-4):127-31. doi:10.5639/gabij.2012.0103-4.028
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9. Kaplan WA, Ritz LS, Vitello M, Wirtz VJ. Policies to promote use of generic medicines in low and middle income countries: a review of published literature, 2000–2010. Health Policy. 2012;106(3):211-24.

Author: Sabine Vogler, PhD, Head of WHO Collaborating Centre for Pharmaceutical Pricing and Reimbursement Policies, Health Economics Department, Gesundheit Österreich GmbH/Geschäftsbereich ÖBIG – Austrian Health Institute, 6 Stubenring, AT-1010 Vienna, Austria

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