Dealing with regulations in the healthcare industry
Baker & McKenzie European Pharma Meeting , 14.06.2013, Zurich
Thomas B. Cueni, Secretary General Interpharma
Agenda
1. Today‘s main challenges for the industry
2. Patent settlement agreements (“Pay-for-delay”)
3. Inherent tension between national health policy (administered
prices) and free flow of goods
4. Clinical trial data transparency
5. Compliance & HCP/HCO Disclosure Code
Dealing with regulations in the healthcare industry
14. June 2013 | page 2/12
Today‘s main challenges for the industry
 Policy and regulatory environment
 Euro-zone crisis
 Single focus on cost-containment
 Missing growth agenda
 Market access delays
 Dogmatic competition law approach!
Dealing with regulations in the healthcare industry
14. June 2013 | page 3/12
Patent settlement agreements (PLSAs)
 PLSAs and “pay-for-delay”
 Conclusion of Commission’s Pharmaceutical Sector Inquiry (2009-2011)
seemed to be pragmatic
 Commission dropped certain previous investigations into pay-for-delay
cases in March 2012 due to lack of evidence (AstraZeneca) or
withdrawal of the complaint by a rival company (GSK)
 DG Competition is still investigating a number of PLSAs between
pharmaceutical companies and generic manufacturers
 Court decision in the first case is expected in June 2013

anti-competitive?


abusive use?
value transfer = restriction of competition “by object”?

irreparable harm
 legal uncertainty!
Dealing with regulations in the healthcare industry
14. June 2013 | page 4/12
Patent settlement agreements (PLSAs)
 Patent rights encourage innovation and settlements of genuine
patent disputes are generally efficiency enhancing
 PLSAs are by nature efficiency enhancing
 Patent litigation in Europe is fact intensive, complex and often
highly unpredictable
 litigation in multiple jurisdictions
 real risks of divergent outcomes
 How to deal with generic competitors “launching at risk”?
 innovators have much to lose!
 Case-by-case approach to assess PLSAs should be limited to:
 fraud in obtaining the patent
 no sham cases
 restrictions exceed the scope of the patent
Dealing with regulations in the healthcare industry
14. June 2013 | page 5/12
Inherent tension between price control and
free flow of goods
The use of IRP by EU member states and the pricing rule used
Conclusions from OECD study:
 International price referencing
 is the most widely used approach
Hammerfest
KEY:
Average
Lowest
None
SWEDEN
(22/30 OECD countries) to cap prices
(or reimbursement levels) of innovative
medicines;
FINLAND
NORWAY
Helsinki
Oslo
ESTONIA
North
Sea
Riga
 the rationale for selecting particular
benchmark countries is not always
explicit.
Dealing with regulations in the healthcare industry
LATVIA
DENMARK
Belfast
 is perceived by public authorities as a
means to assess the appropriateness of
the proposed or actual price in relation
to what is paid elsewhere;
 requires an explicit or implicit notion
about how pharmaceutical prices ought
to differ across countries, and how
they should be similar;
Tallinn
Stockholm
Baltic
Sea
IRELAND
LITHUANIA
Copenhagen
Dublin
Vilnius
U. K.
NETH.
Berlin
Amsterdam
London
Warsaw
GERMANY
BELGIUM
English
Channel
POLAND
Bruxelles
LUX.
Frankfurt
Krakow
Prague
CZECH
Paris
SLOVAKIA
FRANCE
Vienna
Munich
AUSTRIA
Budapest
Bern
SWITZERLAND
HUNGARY
Geneva
Milan
Zagreb
CROATIA
Venice
BOSNIA
Marseille
ANDORRA
ROMANIA
SLOVENIA
Belgrade
Sarajevo
SERBIA
ITALY
PORTUGAL
Bucharest
BULGARIA
MONTENEGRO
Madrid
Barcelona
Lisbon
Adriatic
Sea
Rome
SPAIN
Naples
MACEDONIA
ALBANIA
Aegean
Sea
GREECE
Mediterranean
Sea
Athens
CRETE
Source: CRA analysis. Note that international reference pricing is not applied to all products in every country. For
example, in Germany it is only applied in particular circumstances.
14. June 2013 | page 6/12
Problem has been acknowledged…
 „…a similar price level leads to a different level of affordability
depending on the economic situation of each Member State.
Attention could be given to measures that allow companies to
offer medicines at affordable prices in each EU market.“
 „Member States are not interested in fixing prices of products
that are only transiting through their territory to be utilised
within other Member States. They should, therefore, abstain
from fixing prices for products that will not be used within
their territory and that will not impact on their national
budgets…“
Source: Recommendation on P&R policies from High Level Pharmaceutical Forum
Dealing with regulations in the healthcare industry
14. June 2013 | page 7/12
…but short-term politics still prevail
Static vs. dynamic efficiency
 Pharmaceutical policy making serves multiple objectives that must
be balanced with one another to arrive at the policy mix that best
reflects national priorities:
 affordable access to effective medicines vs. strong pressure for public
cost-containment;
 inherent trade-off between static and dynamic efficiency
 static efficiency, in which consumer welfare is maximised by getting
the most health value from today’s expenditures, as constrained by
the limits of present technological capability
 dynamic efficiency, in which the R&D incentives serve to generate
growth in the capacity to prevent health conditions and cure diseases
in the future.
 Getting the best possible price or lowest possible expenditures for
pharmaceutical products in the market today may mean having fewer
and less innovative alternatives for the future.
Dealing with regulations in the healthcare industry
14. June 2013 | page 8/12
Inherent tension between price control and
free flow of goods
Following ECJ Lélos Judgement of 16 September 2008 on the Greek
reference concerning quota systems (Cases C-468/06 to C478/06)
 Companies even in they hold a dominant position must be in a position
to take steps (to limit parallel trade) that are reasonable and in
proportion to the need to protect its own commercial interests
 Judgments acknowledge right for companies to „protect their
commercial interests“ – but there is no waivering yet from dogma of
unhindered free flow of goods, or call to refrain from international price
referencing
 Revisit current legislative framework
CJEU judgments give flexibility to companies – but don’t solve the problem
Dealing with regulations in the healthcare industry
14. June 2013 | page 9/12
Food for thought
Dealing with regulations in the healthcare industry
14. June 2013 | page 10/12
Clinical trial data transparency
 Access to clinical-trial data
 European Medicines Agency (EMA) announced that it will proactively
publish clinical-trial data and transparency
 Pharmaceutical industry recognises the need to establish a way forward
 But how?
 A number of practical and policy issues need to be addressed before
complex data sets can be made available:
 rules of engagement
 good analysis practice
 last but not least: legal aspects
 Principles for clinical trial data sharing
 PRIVACY: safeguarding the privacy of patients
 INTEGRITY: respecting the integrity of national regulatory systems
 INNOVATION: Maintaining incentives for research and innovation
Dealing with regulations in the healthcare industry
14. June 2013 | page 11/12
Compliance & HCP / HCO Disclosure Code
 Increased regulation of interactions between pharmaceutical
companies and HCP/HCOs at national level:
 Legal provisions: Denmark, France, Portugal, Slovakia
 Self-regulatory provisions: the Netherlands, UK
 Disclosure activities outside Europe: Japan, US (Sunshine Act)
 Different approaches are in place at national level
 EFPIA HCP/HCO Disclosure Code
 EFPIA brings together the 33 European national pharmaceutical industry
associations as well as 39 leading companies
 Much external focus on transparency, particularly related to the pharma
industries past-actions and also future commitments
 Monetary threshold on “Meals & Drinks” as well as prohibition of
“Gifts”
 Data Privacy Requirements must be checked at national level
(including: legislation, regulations and jurisprudence)
Dealing with regulations in the healthcare industry
14. June 2013 | page 12/12
Thank you for your attention!
[email protected]
Interpharma, Petersgraben 35, Postfach, 4003 Basel, www.interpharma.ch