C 021: CRITERIA FOR THE REGULATION OF THE PRICE OF MEDICINES

Excerpt:


J Pharm Pharmacogn Res 2(Suppl. 1): S60, 2014 Special supplement with the abstract book of LATINFARMA 2013 Conference C 021: CRITERIA FOR THE REGULATION OF THE PRICE OF MEDICINES Rovira J. University of Barcelona, Spain. Abstract The pharmaceutical sector does seldom operate as a competitive and efficient market mechanism due to multiple well known factors: … Continue reading C 021: CRITERIA FOR THE REGULATION OF THE PRICE OF MEDICINES

J Pharm Pharmacogn Res 2(Suppl. 1): S60, 2014

Special supplement with the abstract book of LATINFARMA 2013

Conference

C 021: CRITERIA FOR THE REGULATION OF THE PRICE OF MEDICINES

Rovira J.

University of Barcelona, Spain.
Abstract

The pharmaceutical sector does seldom operate as a competitive and efficient market mechanism due to multiple well known factors: asymmetry of information, non-sensitiveness of the demand to prices, barriers of entry on the supply side, and so on. This situation is especially true in the case of products under patent protection and other forms of market exclusivity, which confer suppliers a temporary legal monopoly. Most countries therefore apply direct and indirect forms of price control aimed at containing prices and ultimately pharmaceutical expenditure. There are however many modalities of price control and of criteria for setting the appropriate regulated price. The present debate focuses on international/external reference pricing and value based pricing.  In order to assess the appropriateness of a pricing approach it is necessary to define its objectives and feasibility. As the pharmaceutical market is an increasingly globalised and interdependent one, the analysis of a pricing approach must have a global perspective that takes into account not only how it will affect the market where it is applied, but also the impact on other countries. From a global perspective a pricing approach for new medicines should on one hand provide the appropriate incentives for potential research to address the research priorities of societies and it should also reflect some form of agreement or consensus on how countries should contribute to the cost of innovation. An alternative option is to radically change the business model by delinking the incentives for innovation from the prices of medicines.

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