Pharmaceutical Market Access in Developed Markets

Güvenç Koçkaya, Albert Wertheimer

• Publisher: SEEd Medical Publishers
• Year: 2018
• ISBN:
  9788897419747
• Topic: Medicine
• Subtopic: Medical Education

Market access is the process by which a pharmaceutical company gets its product available on the market after having obtained a marketing authorization from a regulatory agency and by which the product becomes available for all patients for whom it is indicated as per its marketing authorization.It covers a group of activities intended to provide access to the appropriate medicine for the appropriate group of patients at the appropriate price (in most countries). Market Access may also be seen as activities that support the management of potential barriers, such as non-optimal price and reimbursement levels, the restriction of the scope of prescribing for the drug or complicated prescription writing or funding procedures.Since there are cultural differences among countries, any Market Access strategy needs to be culturally sensitive.Pharmaceutical Market Access in emerging markets has been extensively discussed in our previous book, published in 2016. The present book focuses on developed markets with the goal of helping students, academics, industry personnel, government workers, and decision makers understand the environment in developed markets.

1. Introduction to the Market Access

https://doi.org/10.7175/747.ch1

Mondher Toumi 1, Szymon Jarosławski 1

1 Public Health Department – Research Unit EA 3279. Aix – Marseille University, Marseille, France

1.1 Origin of the Market Access Term

Market Access for Goods

The Market Access (MA) term was first introduced by the World Trade Organization (WTO) to define the competing relation between the domestic and the imported products of a country.

The WTO defines MA as a set of conditions, tariff and non-tariff measures, agreed by WTO members for the entry of specific goods into their markets, that is to say, the government policies regarding trade-barriers in general, and specifically the issues of import substitution (to promote local production) and free competition.

Healthcare Market Specifics

In spite of many similarities between healthcare products and other goods in a free market economy, the healthcare market challenges the traditional economic paradigm. There are four features that clearly differentiate the healthcare market from other markets.

1. The price is not determined by supply and demand. In a traditional market economy context, the price is determined by supply and demand. In the healthcare market, however, the prices are determined by payers through negotiation or are simply notified by the manufacturer. Further, in the traditional market, a single entity assumes the functions of the buyer, the payer, and the consumer. In the healthcare market, however, the buyer is the physician who prescribes the treatment, the payer is the health insurance provider, and the consumer is the patient. The three parties do not necessarily have convergent views on the value of healthcare goods.
2. Payers are committed to purchasing health for the society. The healthcare payers’ intent is to provide health for the patient. When payers fund medicine they wish to fund health production. However, they can only buy a proxy of health through the purchase of medicine and healthcare services. The actual outcome in terms of health improvement remains uncertain.
3. Health is specific to each individual. Unlike food or technology, health cannot be shared or traded between individuals. The outcome of a treatment procedure also depends on individual characteristics of the patient. The patients’ characteristics may be not fully known a priori because of the lack of appropriate tools. This repertoire of medical tools is evolving and changes our understanding of the disease and our approach to therapies.
4. Externality of health. Medicines can have a positive impact on the health of people, other than the ones who consume it. This is particularly the case for vaccinations and antibiotics. The treatment and prevention of contagious diseases at the level of an individual can protect the global population from a potential epidemic. Therefore, i) restricting access to health care for a population’s subgroup can have dramatic impact on that population health status, ii) poor health care in a population’s subgroup will affect the health of the remaining part of the population that has good access to health care. This is one of the main reasons for the creation of national health care systems. Illustratively, it has been iteratively reported that, despite the highest per capita healthcare expenditure, the US does not have the best population health status, notably because of the wide disparity in access to health care.

1.2 Healthcare Market Access Definition

The concept of MA is complex to define, depending on whether we are dealing with a private, public or mixed health care system. MA is the process by which a healthcare goods company gets its product available on the market after having obtained a Marketing Authorization (MAu) from a regulatory agency and by which the product becomes available/affordable for all patients for whom it is indicated as per its MAu.

The following definition will be used in this chapter:

MA for pharmaceuticals defines the ability for a drug to achieve through a health insurance system a reimbursed price and a favorable recommendation for medical prescriptions.

It covers a group of activities intended to provide access to the appropriate medicine for the appropriate group of patients and at the appropriate price.

For the manufacturers, the ideal outcome of the MA process is to achieve the optimal price with maximum reimbursement for the approved target population with no limitation on prescription or funding procedures. However, in practice the company needs to strike a trade-off between:

• Price and reimbursement conditions;
• Target patient population selection;
• Prescription and funding procedures.

Therefore, MA can be also seen as activities that support the management of potential barriers, such as non-optimal price and reimbursement level, the restriction of the scope of prescription for a drug or complicated prescription or funding procedures.

The scope of these activities encompasses the management of pricing and reimbursement, Health Technology Assessment (HTA) and formularies. The formularies are the lists of medicines that may be prescribed at the expense of the institutionalized payer.

MAu from a regulatory agency, which could be the Food and Drug Administration (FDA) in the US or the European Medicines Agency (EMA) in the EU, is issued based on consideration of the product’s safety, efficacy, and quality in the highly controlled conditions of Randomised Clinical Trials (RCT). In the case of UE, national agencies are responsible for the implementation of this authorization in their local settings. Once a medicine is approved for marketing, HTA bodies are responsible for assessing its real-life efficacy (i.e. effectiveness), cost-effectiveness, relative efficacy, related medical need, budget impact and other evidence that will be later used by payers for pricing and reimbursement (P&R) decisions, as well as formulary listing and prescription guidelines.

Institutionalized healthcare payers (such as the national health funds, health insurers, etc.) themselves are typically not qualified to evaluate those criteria, so they delegate these activities to independent groups of experts which elaborate the HTA evidence. HTA evaluations aim to inform payers’ decisions and help them set the appropriate P&R conditions.

Finally, MA is not and should not be confused with the following activities: obtaining regulatory approval (license, MAu), medical marketing and sales (e.g. medical representatives getting access to doctors or pharmacists), distribution (access to pharmacy shelves), choosing the right channel to promote product (e.g. marketing, direct-to-customer advertising etc.).

1.3 Market Access Key Concepts

If we consider the WTO definition, obtaining MA should be the ability to access the whole market in a given country, sell the product and achieve revenue from the market without obstacles. In the case of pharmaceuticals, these obstacles are: obtaining MAu, P&R levels, logistics (storage and supply conditions), the drug surveillance (follow up on potential and actual product adverse effects), etc. In practice, however, the pharmaceutical industry has become proficient in addressing all those hurdles except P&R. Thus, MA for the industry has become equivalent to the addressing the hurdle of achieving optimal P&R levels.

Measuring Value

MA is related to the concept of ‘value for money’ from a payer’s point of view. As a result, the primary objective of MA studies is to define and measure the value of health services and products.

In economics, the value is a concept that refers to two different theories. The first one is an objective theory, or the intrinsic theory of value, where the value of an object, good or service, corresponds to the cost of the production that is the cost of raw material and human work needed.

The second one is a subjective theory and is more consistent with the idea of value as perceived in the healthcare market. According to this theory, the value of a good is neither determined by any inherent property of the good, nor by the amount of labor required to produce the good, but is determined by the importance of acting individual place on a good for the achievement of their desired outcome. The price offered is therefore not a measure of the subjective value; it is just a means of communication between the buyer (healthcare payer) and the seller (the manufacturer).

As far as healthcare and MA are concerned, this last definition is the most relevant and should be used. In MA, the value of a drug or a health service depends on the institutionalized payers’ subjective perception of a particular medical need in the society and how the product addresses that need.

This assessment of value made by payers is subjective, yet based on scientific evidence, such as clinical trials, epidemiology, cost-effectiveness or other HTA studies. Most institutionalized payers formally require drug manufacturers and healthcare providers to submit evidence that corroborates the value of their product in terms of clinical outcomes and/or the cost of achieving such outcomes. Achieving a positive coverage decision at an optimal price depends on the ability of the pharmaceutical industry to submit pertinent evidence. If they succeed, this translates into successful MA for the concerned product. This calls for a thorough understanding of this evidence-based concept of value on the part of this industry.

The kind of evidence required by the payers for the assessment of a product differs from one country to another and covers a wide array of indicators, such as proof of clinical and economic value and more specific considerations of ethics, equity and/or politics. The set of evidence generated and presented by the manufacturer for the payer is called the value proposition. The development of such proposition is the ultimate aim of MA activities from an industrial perspective.

However, from a payer’s perspective, the objective is to relate the drug’s value to its price considering all available evidence. This is one of the most debated issues at the moment among healthcare actors and is often called value-based pricing.

Market Access and the Structure of Healthcare Markets

Pharmaceutical markets can have a varying degree of fragmentation, from countries with a single national insurer to countries with multiple private insurers or a mix of both. In the latter two cases, securing MA is the ability to systematically gain access at optimal conditions in each and every geographic area with each and every insurer. Depending on the type of healthcare market organization (e.g. centralized vs. decentralized or fully fragmented) the MA strategy may focus on different aspects as described below.

Publicly-funded health care systems

Within publicly funded national health insurance in Europe, Australia and Canada, the government defines the overall public health goals and the corresponding budget. Then, the rules of access to the public healthcare market by the industry are laid out by a central agency or agencies. These rules involve the kinds of evidence which are required for the value assessment of health products and the criteria for making the funding decision. In principle, the public healthcare payers represent the society’s interest and try to integrate the societal perspective when making the funding decisions.

Mixed or private health care systems

The US is an example of a country where health insurance is fragmented and largely private. There is no unified framework which regulates the conditions of obtaining MA in the US and the public, as well as each of the private insurers, follow their own pathway. In this setting, for-profit private healthcare payers engage in independent negotiations with the industry. This can be seen a negotiation between two business entities that are looking to maximize their profits. However, in the US, the public payers (the Centers for Medicare & Medicaid Services – CMS, e.g., Medicare, Medicaid, and the Children’s Health Insurance Program – CHIP) represent an increasing proportion of the healthcare budget that is almost nearing the commercial insurance sector. The CMS pathway resembles that of many European countries, Australia or Canada, except that formal health-economic analysis or HTA is not compulsory in the US, excluding very rare cases. Further, unlike in some European countries, the high cost of a product should not be a cause for a negative reimbursement advice by the CMS.

Centralized and regional market access

A trend towards decentralization is emerging in the public healthcare settings, as policy-making is increasingly devolved from the central, national bodies to local health authorities. As healthcare payers are compelled to restrain their pharmaceutical budgets, in a context of the economic recession, local policy makers are faced with funding decisions. However, these responsibilities are not always matched with competencies at the regional level. In many countries, the regional authorities accountable for medicine spending are seldom prepared to negotiate the costs of the drugs or to assess their value.

This trend is blurring the traditional division between countries with decentralized healthcare systems, such as Spain, Italy, Sweden or Germany and countries with more centralized ones, like France or England. E.g. in England, where s...

Table of contents

• Cover
• Colophon
• Preface
• 1. Introduction to the Market Access
• 2. Market Access in Germany
• 3. Market Access in the UK
• 4. Market Access in France
• 5. Market Access in Italy
• 6. Market Access in Spain
• 7. Market Access in Portugal
• 8. Pharmaceutical Market Access in Denmark, Sweden, and The Netherlands: an Overview
• 9. Market Access in Japan
• 10. Market Access in Australia
• 11. Market Access in New Zealand
• 12. Pharmaceutical Market in the U.S: a Brief Treatise
• 13. Pharmaceutical Market in Canada: a Brief Treatise
• 14. Market Access Hurdles in Developed Countries
• 15. Role of Health Technology Assessment in Pharmaceutical Market Access in Developed Countries
• 16. Impact of the International Reference Pricing on Pharmaceutical Market Access
• 17. General Overview of Value-Based Pricing
• 18. The Role of Patients in Market Access
• 19. The Challenges and Future of Advanced Therapies
• List of Main Abbreviations
• Authors
• Notes