PRICING & REIMBURSEMENT AGAINST THE BACKGROUND OF HEALTHCARE REFORM IN RUSSIA

Omelyanovskiy Vitaly MD, PhD, «Centre for Health technology assessment» RPAPA

Positive developments in health care indicators 

Demographic crisis is not overcome, population continues to shrink. currently 141,9 MN vs. 143 MN in 2006

It is

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Life expectancy of Russian women has increased to 74,9 years.

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New born mortality has decreased over the last 10 years by 2 times to 7,5 per 1000 life births.

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Morbidity and mortality rates are several times higher than in EU

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Men’s life expectancy (60 years) is one of the lowest in the world

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Over the last 5-7 years health care sector has become a top government priority.

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Over 3/4 of all drugs circulated in the country are foreign made

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Significant government funds are pumped into health care system through 1. drug reimbursement programs 2. national priority project Health 3. regional health care facilities modernization project 4. Pharma 2020 strategy

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Price& Reimbursement interactions Federal reimbursement program for disable people

DLO

VACCINE

Including in EDL needs price regulation. So EDL defines the price for product.

7 HCD

Federal reimbursement program for 7 High Cost disease

But entering in EDL is important for future reimbursement.

ONLS

HOSPITAL

Regional reimbursement program

Limitations of the existing practice of creating reimbursement lists 

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Existing practice of selecting pharmaceutical drugs for inclusion in reimbursement lists does not lead to informed decision-making Decision-makers are not committed to use of HTA reports for making decisions on funding medical technologies from state funds Creation of reimbursement lists is not supported by expert evaluation of clinical efficacy and cost-effectiveness Key influencers in decision-making process are esteemed chief experts of the MOH. However they are not familiar with HTA methods. As a result opinions of these experts are not sufficient for objective decisions taking into account the results of EBM research and HE evaluations

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EDL decision making criteria Product has robust data on clinical efficacy and safety of the product including local clinical data

Product addresses unmet HCS needs (impact on key indicators, social significance)

Cost saving Affordability/ budget impact Locally produced HE data (incl. CEA) versus comparator

Product presence in treatment standards and guidelines, incl. international



EDL is “multi-functional” list (mix of products, mix of missions)



No HTA authorized by HCAs in place – no standards of HE evaluation

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Medical community, PAGs are not a part of decision making process

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Opinion of KOLs is important, but not completely determinative

Additional important criteria of decision making

Presence in local treatment standards

Local experience and demand in place

Local production/ Partnership with local producers

EDL revision experience 2010 42 new INN included: 6 HIV products + 8 change of registration expired + 25 included into local treatment standards/ locally produced Gx + 3 innovations

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Registered prices on ED depend on:

Domestic

I.

Average sale prices of producers for certain period .

II.

Opportunity to increase prices annually using inflation rate

I.

Average import prices (declared at customs) for certain period (a special formula for the calculation)

II.

No opportunity to increase prices annually using inflation rate

Foreign

“Original” and previously not supplied in Russia ED

Minimum prices in reference countries (20 countries are included in basket)

Executive summary of New launches pricing  Free pricing at launch. Prices of non-EDL medicines are not regulated

 Entering EDL is important for future reimbursement but it leads to price regulation  Low price won’t guarantee solid volume at launch. Direct contracts with manufacturers are discussed by officials but legislative platform for creative pricing models still work in progress  When price regulation is connected with drug insurance system, the new technology/approaches will be implemented (e.g. internal INN reference pricing)

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HC system development: Pharma 2020 program – focus on local industry and innovation

2007 Imported 80%

2020 Local 20%

Original

Imported 50%

Local 50%

Original

Generic Branded generic Generic

Cluster push, 2012-2014 hopes

3 млрд. рублей Санкт-Петербург Инновационные препараты

30 млрд. рублей

Республика Татарстан

Инновационные препараты

Препараты ЖНВЛП

Владимирская область Инновационные ЛС

3 млрд. рублей Томская область Препараты ЖНВЛП, биотех

млрд рублей 10 млрд. рублей Ярославская область Препараты ЖНВЛП

1,1 млрд . рублей Калужская область Препараты ЖНВЛП

30 млрд рублей Ставропольский край Госпитальные растворы

11 млрд . рублей

Московская область

11 млрд .рублей

более

About $ billion 8,5

Branded generic

3,5 млрд. рублей Волгоградская Область Препараты из списка ЖНВЛП

3 млрд. рублей Липецкая область Инновационные ЛС

110 млрд. рублей Алтайский край Препараты из списка ЖНВЛП

14 млрд. рублей Свердловская Область Препараты из списка ЖНВЛП

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Modernization of the drug reimbursement system Current out-patient/in-patient drug supply

$7.6BN = $4.3 BN for reimbursement programs + $0.8BN for Vaccines, Diabetes, TD, Hepatitis B&C + $2.5BN (OMI-outpatient/in-patient

Federal Budget

OMI

Regional Budget

DLO/ONLS FZ 178, 1998

7 HCD Government regulation

Drugs under PGG

Region benefit program, GVRM Order. 890, 1994

DLO list

18 INNs

EDL 567 INNs

Regional benefit list

$1.6 BN

$1.7 BN

2.5 BN

$1 BN

5.5 MN people

60,000 people

Insured population

52 social groups and 37 diseases 7.6 MN people

69% of the drug costs are covered by out-of pocket, 31% – out of public funds, incl. 19% through reimbursement system and 12% - PGG

Health Care Sector Changes: summary

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Health Care is high in the political agenda

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Standards of care implementation with free access to treatment guarantee since 2013

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National Drug Insurance system implementation start in 2013 with full roll-out in 2016

Reimbursement and Pricing: summary 

More clarity in EDL revision process in 2013

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HTA system introduction in 2014-2015 

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President’s order “On improvement of state policy in health care”

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Priority diseases area highlighted

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New target on 90% of EDL INN localization by 2025 emphasized

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National Strategy of Drug Policy to be developed by the end of 2013

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Value of innovation is recognized

Pricing system reforms: 

Free pricing on local innovations



External price reference

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Internal INN reference pricing introduction (in 2014?)

15% price preference for local mfrs - till 2015

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THANK YOU FOR YOUR ATTENTION «Center of Health Technology Assessment» Russian Academy of National Economy and State Services under President of Russia

National Center of Health Technology Assessment

Vitaly Omelyanovskiy [email protected] [email protected] +7 (495) 210 44 80

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