Recent changes to the pharmaceutical price setting have improved the market environment risk market in France, with GlobalData looking at their impact on the price of orphan drugs.
Changes in positive price negotiations for orphan drugs
The changes in question were introduced in March 2021 through a new contract agreement signed by the French Pharmaceutical Companies Association (LEEM) and the Health Ministry’s (MoH’s) Health Products Economic Committee (CEPS).
As for orphan drugs, the terms of the agreement say that if the annual cost of a treatment is determined to be more than EUR50,000 ($ 52,599), a “flat rate payment” may be accepted in lieu of the price on the line. With internationally applicable prices. A positive funding decision can be linked to a performance-based risk sharing agreement, with pre-determined discounts determined by the therapeutic performance of the product.
Orphans and orphans (Amélioration du Service Médical Rendu, ASMR) with a rating of therapeutic improvement from I to V can benefit from the new fast track route, which allows the drug to set the first price within 15 days. Under the following conditions:
- ASMR I to III drugs must have received favorable pharmaco-economic evaluation.
- ASMR IV drugs must have received favorable pharmaco-economic evaluation and are likely to have a negative budget impact.
- ASMR V drugs should have a lower proposed price than the comparable price.
30% of orphan drugs are considered to bring about therapeutic improvement
According to data from GlobalData’s The Price Intelligence (POLI) Therapeutic View Database, orphan drugs are likely to benefit from the fast route and favorable pricing conditions. Orphan drugs usually get the highest therapeutic improvement rating. Of all orphan instructions in the GlobalData database, 5.9% received a higher ASMR (I) rating, compared to 0.6% for non-orphaned instructions. On average, about 30% of orphan instructions receive an ASMR of I to III, 34% receive an ASMR of IV, and an ASMR of 23% V.
Only 4% of orphan drugs were excluded from reimbursement due to insufficient clinical value, compared to 11% of orphan drugs. The rest are sold under the Early Access Plan or have no ASMR rating.
The ASMR value is the key to getting a favorable price in France. In conjunction with the Commission for Economic Valuation and the Pharmaceutical-Economic Assessment (Commission Évaluation Économique et de Santé Publique, CEESP), the level of ASMR has a major impact on companies’ ability to negotiate drug prices.
Most orphan drugs cost more than EUR50,000 per patient
GlobalData’s Price Intelligence data shows that 80% of orphan drugs (out of a total of 87) in France have an annual treatment cost of over EUR50,000 ($ 52,599) per patient per year. This suggests that it is very common to resort to new flat-rate payments for upcoming orphan drugs.
If an indication is selected that has the highest annual treatment cost, 17.5% of orphan drugs have an annual treatment cost of less than EUR50,000 ($ 52,599). Most orphan drugs have annual treatment costs of between EUR100,000 ($ 105,139) and EUR500,000 ($ 525, 697) per patient.
The French National Health Authority (Haute Autorité de Santé, HAS) more favorably evaluates orphan drugs as compared to non-orphan products, resulting in a positive impact on pricing. Recent changes to pricing rules further facilitate the “negotiating” environment for orphan-drug makers, ensuring early access to orphaned patients, and a fixed budget for French payers in the case of expensive orphan drugs.
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