New regulations being prepared by the United States, under which the Trump administration will reduce the prices of some medicines, will have a “contagion effect” in Europe. This was stated in the report “The Global Impact of the Most Favored Nation: The Future of Drug Pricing” issued by BIP Consulting, … This warns of a “global reset” of the logic of drug prices, which may change the historical balance between the United States and Europe. According to different economic models that analyze the situation, the reduction could range between 30 and 60 percent.
Specifically, the impact of regulations known as “most favored nation” (MFN) will be seen in groups of specific innovative medicines, such as some oncology or immunology drugs, for which there has traditionally been a significant price differential between the United States and other countries, notes Silvia Ondategui Parra, senior global partner for health sciences at BIP. Donald Trump’s idea is to set the prices of drugs financed by the regime based on the second lowest price among eight developed countries, namely Canada, Denmark, France, Germany, Italy, Japan, Switzerland and the United Kingdom.
Downward pressure
But the BIP report warns that while being a measure that in principle should only affect the US – where it is due to come into force next January – this regulation has a high probability of being extended to more countries, changing the current rules of the game with downward pressures.
Although the goal is not to influence innovation, many companies in the pharmaceutical industry are already considering how to maintain the profitability of the drugs they develop, considering a change of strategy that may involve delaying the launch of these drugs in countries where prices have traditionally been lower. “The idea is that it does not impact innovation or access by patients, but the project is still at a very preliminary stage. “It is very important that it is articulated and implemented very well so that it does not affect access to innovation,” explains Ondaatgui-Parra, who realizes that it could change drug launch times. “Some countries may have a more important position in the future than they had in the past.”
suspicion
The BIP partner says there is a lot of uncertainty in the sector. Another idea floating around is that with this change, subsidized drugs – those for which the patient pays only a small portion as the state pays for them – could be reduced, but the point of the change proposed by Donald Trump, Ondategui-Parra insists, is not that. This should not lead to problems with the supply of medicines, something that Spain has witnessed in a notable way with some specific medicines in recent years, but the uncertainties surrounding the project, which change practically every week, cannot be categorically guaranteed that it will not happen. However, this expert explains, each country can amend its regulations in this regard to avoid risks. In the latter case, early notification requirements may be considered if there is a withdrawal or shortage, for example.
“In industry, everyone is a little bit committed, monitoring the changes that happen week after week, and trying to analyze the impact using different potential models,” says Ondategui-Parra. He insists that the new regulation is not a temporary change, but rather represents a “turning point” that will represent a completely different model for companies.
The report also focuses on another point: transparency. The document indicates that the American standard is accelerating the shift towards more transparent and results-based pricing models. “Very clear rules regarding the exchange of information must be established, and a secure exchange system must be designed and, if necessary, with independent auditors,” the expert said.