ISPOR Croatia Chapter:

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ISPOR Croatia Chapter Croatian Pricing
Reimbursement Overview
ISPOR Belgrade conference, March 2009. Viola
Macolic arinic
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Croatian Pricing Reimbursement Overview
ISPOR Belgrade conference, March 2009.
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ISPOR Croatia Chapter
ISPOR Belgrade conference, March 2009.
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ISPOR Croatia

• Was established in May 2008 under the name
  Croatian Society for Pharmacoeconomics and
  Outcome Research ISPOR Croatia.
• 32 members
• academia, research institutes, and the
  pharmaceutical industry
• medical doctors, pharmacists
• Executive Board
• Pero Draganic, MD PhD president
• Ljubica Besker-Ivasovic MD PhD president elect
• Viola Macolic-Sarinic MD M.Sc - secretary

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ISPOR Croatia

• Internal education for the members
• Lecture topics (2008)
• Introduction in Pharmacoeconomics
• Outcome Research
• Incremental Cost-Effectiveness Ratio
• Main Principles of Conduction of
  Pharmacoeconomics Analyses
• ISPOR Book of Terms translation into Croatian
  language
• Development of Pharmacoeconomic guidelines
• Workshops

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Croatian Pricing Reimbursement Overview
ISPOR Belgrade conference, March 2009.
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General Market Overview

• - More than 80 marketing authorization holders
• All major pharma companies present
• 3 domestic generic companies
• Only one (state-owned) health insurance company,
  so far
• A B reimbursement list without and with
  co-payment
• A special fund for rare-disease and expensive
  medications

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Major Problems
Pricing - lack of stimulation for innovation -
high prices of generics. Reimbursement - lack of
transparency and EBM use - insufficient
understanding of Health Technology Assessment -
no clear guidelines within reimbursement
process. Drug Prescription Dispensing - no
incentives for generic use only penalties for
budget overruns - co-payments
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Current Decision Process

• National Level
• Only one (state-owned) health insurance company
  (HZZO)
• Both pricing and reimbursement levels depend
  solely on HZZO
• Few legislative acts define reimbursement
  processes and pricing
• A new Ordinance from May 2008 (Gazette 60/08)
  includes
• pharmacoeconomic analysis
• Private insurances just additional health
  insurance

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Current Decision Process (cont.)

• Regional Level
• administrative role
• decision making process is mostly centralised

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Current Decision Process (cont.)

• Hospital Level
• Independent Hospital Formularies
• own decision making boards (Hospital Drug
  Committees)
• Separate negotiations with state health
  insurance for hospital drug budget
• Hospital budget is limited and is negotiated on
  the basis of
• previous period expenditures
• assessment of expected drug expenditures for the
  negotiating period

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Short Description of Reimbursement Process

• Main principles defined by law (Acts on pricing,
  including onto the list
• A or list B, launching, marketing)
• MAH applies for the reimbursement
• ?
• Health Insurance Drug Committee (independent
  experts) - application
• assessment
• ?
• Health Insurance Board of Directors final
  decision

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Short Description of Reimbursement Process (cont.)

• MAH APPLICATION
• wholesale price proposal
• compared with reference countries
• level of difference (price difference year to
  - date)
• pharmaco-toxicological expert opinion
• clinical expert opinion
• pharmacoeconomic analysis

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Short Description of Reimbursement Process
(cont.)

• MAH APPLICATION
• applications are reviewed on regular basis by the
  Health Insurance Drug Committee and either
  accepted, rejected or sent back for
  recalculations

• DECISION MAKING
• accepted applications are forwarded to the Health
  Insurance Board of Directors (various influences
  involved into the final decision)

Generic drugs shortened procedure - approvals 6
8 times a year Innovative drugs bulk
approvals usually once or twice a year!
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Disadvantages of pharmacoeconomic analysis use
- Due to the substantial impact of new drugs on
the health budget a price is a principal guide
for successful reimbursement !
- Cost minimization analysis generally used,
often inadequately !
- Cost effectiveness analysis often misinterpret
(generally associated with substantially
increased expenses) !

• Problems with acceptance of innovative drugs

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Funding Mechanisms

• All levels of the health insurance generally
  funded from the state budget
• Co-payment introduced but not fully cleared

• DRG based reimbursement list is being developed

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Refferent Countries and Resulting Prices
- 16
- 11
- 30,67
- 31
innovative drugs to 80-90 level of AVG
refferent price! generic drugs to 60 level of
AVG refferent price!
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Timing

• Drug Committee - monthly meetings
• Generic and parallel drugs 3-6 months
• Generic drugs with lower price regularly
  approved

- Innovative drugs up to one year (depends on the
time of submission)!
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Critical review

• Burden of new drugs extremely high even for the
  richest countries

Spending for Medicare Part B, which covers drugs
administered in a physician's office setting (of
which cancer treatments make up a large
proportion), rose from 3 billion in 1997 to
11 billion in 2004.
Nelson R. N Engl J Med. 2009
Cancer patients with private health insurance are
at risk for huge medical debts, personal
bankruptcy, and delaying or forgoing treatment.
Mulcahy N. Medscape Medical News, 2009
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Critical review (cont.)

• LIMITATIONS
• In qualitative assessment of applications
• APPROPRIATE WEIGHT OF OUTCOMES
• ISOLATED ASSESSMENTS
• DATA INTERPRETATION
• DATA TRANSFERABILITY

ACKNOWLEDGEMENT
Of concern to health economists, said Dr. Bach,
is that, at least in some cases, the cost of
oncology drugs appears to be rising faster than
the health benefits associated with them. Several
experts have suggested a pattern of "diminishing
returns," for example, in the treatment of
metastatic colorectal cancer.
Nelson R. N Engl J Med. 2009
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Critical review (cont.)

• LIMITATIONS
• In final decision
• SOCIO-ECONOMIC INFLUENCE
• POLITICAL INFLUENCE
• DATA INTERPRETATION
• OTHER INFLUENCES

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Future Developments
MAGIC SOLUTION hardly to be expected!
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Future Developments (cont.)

• financial ability insuficient to follow growth
  of drug expenditures
• more (private) insurance companies
• higher impact of external fundings (co-payments,
  funds, additional insurance, etc.)
• efforts for better expenditure control
• more precisely rules definitions
• strenghtening of the pharmacoeconomy role
• HTA Agency
• education on all reimbursment levels

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Potential Future Developments in HTA

• Following has to be enacted
• clear guidelines for analysis conduct
• types of analysis stated
• clear perspective of analysis
• discounting rate
• financial tresholds have to be decided upon (CUA
  CEA).

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Authors
Marijo Vukuic Marinko Biluic Viola Macolic
arinic