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Poland's Reimbursement Act – A promise only partially delivered
At the end of last year, the Polish Ministry of Health (MoH) published its summary of the achievements of the Reimbursement Act. The wide-ranging legislative package, brought into effect at the start of 2012, affects all aspects of pharmaceutical P&R in Poland. The Act has been highly controversial for many groups --including pharmaceutical producers.
In the MOH's summary, it focused on what it regards as the Act's successes. These include, the addition of 39 new innovative molecules on to the reimbursement list (including 14 used in the treatment of various cancers); 13 updates to the reimbursement lists during 2012 and 2013(compared with 13 updates from 2005 to 2011); and a reduction in the amount paid out in co-payments by patients for reimbursed medicines (from PLN4.413 billion (USD1.452 billion) in 2011 to PLN3.392 billion in 2012).
Improved access to innovative drugs? While the Reimbursement Act was being developed, the MoH repeatedly reiterated that a fundamental principle guiding the legislative changes was the need to increase access to innovative medicines. Looking only at the numbers of new innovative molecules added to the list in 2012-13, it is certainly true that there were a good deal more added in this period than at any time previously.
These new additions to the reimbursement list are very welcome; however, it is fair comment to state that the Polish MoH has done little more than to catch up with comparable countries in the Central and Eastern European region by adding these drugs to the list. In an interview with Medinfo, Krzysztof Łanda, former director of the Department of Drug Administration at Poland's National Health Fund (NFZ), said that while Poland used to be in the last place in the European Union (EU) in terms of access to innovative medicines, it has moved to the third or fourth from last in the EU. Łanda stated that access to innovative medicines (in a hospital setting) in Poland has improved in recent years.
Community pharmacy-based reimbursement declines
Notwithstanding this, since the Reimbursement Act came into effect, there have been a growing number of reports of supplies of certain medicines running short, reportedly due to an increase in parallel exports. Additionally, while the total value of co-payments paid out for medicines reimbursed via community pharmacies has declined, for various reasons relating to the Act, the sales of non-reimbursed prescription drugs grew significantly in the year following the Act's implementation, placing a greater burden on patients. NFZ spend illustrates this perfectly. In 2011, the amount spent by the NFZ on drug reimbursement via community pharmacies was PLN8.823 billion; in 2012, this fell to just PLN6.863 billion. This represented a 22% reduction year-on-year (y/y); while, in contrast, spending on high-cost drugs in hospitals went up 20% y/y over the year.
There are a number of factors behind the decline in community pharmacy reimbursement and the rise in the sales of non-reimbursed prescription drugs. First, there was a substantial stockpiling of medicines at the end of 2011, as patients feared that they would need to pay more once the Act came into force. Then, there were the doctors' protests regarding new rules on how to write prescriptions, during which doctors wrote prescriptions for which many did not claim reimbursement, and new rules were introduced limiting reimbursement to registered indications, which have resulted in some doctors opting (in order to avoid financial penalties) to write non-reimbursed prescriptions for drugs which are officially reimbursed. These factors have resulted in a rise in the value of the sales of non-reimbursed prescription drugs, which has also been boosted by some companies opting to remove their products from the reimbursement system, in response to the new changes.
On top of that, the reduction in the number of reference groups and the broadening of existing ones resulted in increased co-payments for some products. The pharmaceutical industry is also adversely affected by the frequent updates of the reimbursement list. Every two months, new and cheaper generics are added, pulling down the prices of ever larger groups of drugs in their wake. Pharmacies complain that they lose money due to the frequent changes, because they do not want to build up stocks of drugs which only a short time later will no longer be the reference product.
Substantial savings from drug reimbursement budget
All these factors have contributed to bring prices down and the level of reimbursement paid by NFZ down as well. Towards the end of the year, Poland's Supreme Audit Office published a report on the NFZ's expenditure in 2012thatshowed as much as PLN1.8 billion due to be spent on drug reimbursement was not spent. The majority of this unspent money was from drug reimbursed via community pharmacies.
Savings meant to be reinvested in drug reimbursement
While there has been an improvement in the hospital sector, the sharp reduction in spending on reimbursement via community pharmacies has had a detrimental impact on pharmaceutical companies, from across the sector (producers, wholesalers and retailers). Furthermore, although the savings from reduced reimbursement expenditure in this sector are supposed to be spent on increasing access to innovative drugs, there are experts in the sector who suspect that the saved money will be used to pay off the overspending of hospitals, in contrast to the actual regulations of the Reimbursement Act, which state that these savings should be retained for drug reimbursement purposes only.
In summary, the Reimbursement Act has resulted in a marked improvement in terms of new innovative drugs becoming available in the hospital sector. However, it has had a negative impact on the pharmaceutical industry in the outpatient sector. An important effect of the worsening of the situation for the pharmaceutical industry in the outpatient market is the rise of the OTC sector. Even though OTC prices have risen significantly - with producers, wholesalers and pharmacists seeking to make up for lost revenue from the reimbursed sector - OTC continued to grow in 2012 (while the reimbursed sector declined). It has grown at a higher rate than the reimbursed sector in 2013. Producers are investing considerable resources in OTC, and the Polish public continues to buy an increasing quantity of OTC products.
It is hard to imagine any major changes to the current situation in each market segment until important changes to the Reimbursement Act are made -a major amendment to the Act put forward in September last year was put on hold and only now appears to be coming back onto the government's agenda, meaning that change is unlikely to be imminent.
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