Public health authorities and pharmaceutical companies have searched for alternative funding formulas to share the risks and uncertainties arising from public coverage of new medicinal products, whose clinical effectiveness and budgetary impact are still unknown. In Finland, one fifth of all patented medicines administered at the hospitals are accessed through managed entry agreements.
National payers across Europe are increasingly looking into innovative reimbursement approaches to balance the need to provide rapid access to potentially beneficial medicinal products with the requirements to circumscribe uncertainty, obtain the best value for money or to ensure affordability. This has led to the concept and increasing implementation of so-called “Managed Entry Agreements” (“MEAs”), further defined as “cost-sharing agreements” and “risk-sharing agreements”.
The key underlying reasons for using MEAs can be listed as below:
- Potential large patient population leading to potential high budget impact
- Difficulty in demonstrating cost-effectiveness at a local level
- Clinical trials misaligned with real-world patient care
Cost-sharing agreements (CSA) provide means for the payer and the pharmaceutical company to share the financial costs of introducing an innovative medicinal product. CSAs can be further divided into price-volume agreements, budget and utilization caps, and discounts. Under risk-sharing agreements (RSA), the public payer and the pharmaceutical company share the risks associated with the clinical outcomes in patients treated with the innovative medicinal product. RSAs can be defined as “outcome guarantees”, “money-back guarantees”, “payment by results” or “conditional treatment continuation”. For the latter, treatment financing continues only for those patients that achieve a certain level of treatment effectiveness.
MEAs in Finland
In Finland, there has been an increasing interest to adapt the concept of MEA to the Finnish environment. Towards this goal, the Pharmaceuticals Pricing Board has, since the beginning of 2017, started a process to accept conditional reimbursements, leading to several granted confidential cost-sharing agreement reimbursements. While CSAs have an established role in Finnish specialized healthcare system, there has been very limited information on the use of RSAs in Finnish hospitals.
Use of MEAs in Finnish hospitals
The costs of treatments administered at hospitals have increased rapidly in Finland. To understand the current situation of MEA use in hospitals, Medaffcon conducted a survey in 2017 to have an understanding of what methods other than flat discounts are used to facilitate access to hospital treatments. The survey focused on managed entry agreements providing access to patented medicines, that had been conducted during the past 2 years (2015-2017).
To summarize the key findings of the survey; 11 of the 21 hospital pharmacies participated in the survey providing a reliable overview of the MEA use in Finland. Information was provided by hospital pharmacies of all sizes, such as University Hospitals, the biggest central hospitals as well as smaller pharmacies. Based on the conducted survey, all hospitals participating the survey had received flat discounts. The popularity of flat discounts is likely to reflect their easy manageability and adoptability to the current hospital tendering processes. In addition, half (55%) of the hospitals had received discounts based on drug utilization (price / volume agreements). Outcome-based discounts and conditional treatment continuation or provision of treatment initiation -models were used in 45% and 73% of the hospitals participating in the survey, respectively.
The conducted survey showed that risk sharing is an actively used approach in Finland. Access for 19% of the patented medicines were associated with MEA-based discounts. Agreed discounts were on average 20%. RSA-based access to medicines led to on average 28% discounts. The higher discounts associated with RSAs represent the current trend of constantly increasing costs of new medicines.
Tamro LINK Hospital
Tamro LINK Hospital service emerged from the need for hospitals and pharmaceutical companies to help manage the pricing agreements for hospitals. The service lightens the workload for RSA and other pricing methods used to set price for medicines at hospital department and hospital pharmacies. Tamro LINK Hospital compiles all contractual information, and care personnel can easily enter information on the dose and treatment period of the patient centrally. With the Tamro LINK reporting section, the hospital pharmacy monitors and manages its contracts with ease. The service is available to all pharmaceutical companies and is not dependent on the wholesaler used by the pharmaceutical company.
Learn more about managed entry agreements from the links below: