The implications of external price referencing on pharmaceutical list prices in Europe

Marcell Csanádi, Z. Kaló, Christian P.J. Prins, Eszter Grélinger, Anna Menczelné Kiss, Frank Ulrich Fricke, Leoš Fuksa, Tomas Tesar, Manoela Manova, László Lorenzovici, Z. Vokó, Louis P. Garrison

Research output: Article

5 Citations (Scopus)

Abstract

External price referencing (EPR) is a frequently applied cost-containment measure to control pharmaceutical prices. This study aims to determine the implications of EPR on ex-factory pharmaceutical prices in European countries. Prices of 21 pharmaceuticals and 17 non-pharmaceutical services were collected with a survey and price corridors were defined in 7 countries. To increase the sample size for further analysis, pharmaceutical prices were retrieved from EURIPID database for 8 additional countries. Regression analyses were applied to evaluate explanatory variables on pharmaceutical list prices including EPR components, GDP per capita, and population size in 15 European countries. Price corridor was narrower for pharmaceuticals compared to non-pharmaceutical services. In univariate regression analysis, higher GDP per capita and population size were associated with higher prices, and taking lowest price from referenced basket of countries was associated with lower prices. In multiple regression analysis, GDP per capita, population size and number of countries referencing a country had modest, but significant association with prices. Findings indicate small price variation for pharmaceuticals that points towards the occurrence of price-convergence. The relatively minor association of EPR with pharmaceutical list prices could be explained by manufacturers’ compensatory mechanisms including confidential price reductions and discounts while maintaining high list prices in countries with strong price-control measures or delayed product launch in countries with traditionally lower prices. Consequently, EPR cannot be directly associated with narrow European price corridor, and lower income countries still have slightly lower list prices.

Original languageEnglish
JournalHealth Policy and Technology
DOIs
Publication statusAccepted/In press - jan. 1 2018

ASJC Scopus subject areas

  • Biomedical Engineering
  • Health Policy

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    Csanádi, M., Kaló, Z., Prins, C. P. J., Grélinger, E., Menczelné Kiss, A., Fricke, F. U., Fuksa, L., Tesar, T., Manova, M., Lorenzovici, L., Vokó, Z., & Garrison, L. P. (Accepted/In press). The implications of external price referencing on pharmaceutical list prices in Europe. Health Policy and Technology. https://doi.org/10.1016/j.hlpt.2018.07.005