Germany’s GKV-SV targets to increase medicines’ spending ceiling by 4.6% in 2021

Blogpost created by Dimitra S. Sotou, Client Solutions Lead, Pricing & Market Access

As opposed to the rest of key EU payers focusing on cost containment strategies for 2021, the German umbrella payer group GKV-Spitzenverband (GKV-SV) has announced to be targeting a +4.6% increase in national medicines expenditure within 2021 under an agreement reached with the National Association of Statutory Health Insurance Physicians (KBV).

The spending adjustments have occurred to account for “the use of innovative drugs” (+4.6%), with a price reductions of -0.2% and a shift between service areas of community physicians and hospitals of +0.2%, according to the agreement dated 1 October.

So far, no further details on the innovative drugs have been provided in the agreement. The agreement, which is negotiated annually, aims to regulate doctors’ prescriptions and forms the basis for regional objectives which are then fixed between the statutory health insurance (GKV) and the 16 community-based doctors’ regional associations (KV).
According to the agreement, the additional costs through pharmacy delivery to patients and savings through a temporarily reduced value-added tax (VAT) rate are not included in the calculations neither for 2020 nor 2021 as these were considered as one-off effects due to the current #COVID pandemic.

Thinking of the impact this increase can have onto pricing & access landscape, GPI experts expect:

  • Increasing room for expenditure, surely creates incentives for innovative medicines’ manufacturers to maintain Germany as their go-to market for successful launch in Europe; therefore, we can expect a potential spike in new product launches in Germany within 2021. In parallel, GBA increases data requirements for price & reimbursement negotiations to keep the cost-benefit balance
  • Due to the focus on innovative therapies, it is likely to observe further establishment of funds for high-cost therapies such as cell & gene therapies or orphan medicines. This can also contribute to higher likelihood of those costly therapies to stay on market post-AMNOG negotiations and for the longer run
  • Other EU markets could potentially start picking up Germany’s approach on medicines’ spending management and tactics; however, other economic factors also come into play

Will the above-mentioned measures also have a positive impact on patient access to innovative treatments after all or are there other influencing factors that still impose hurdles? This remains to be seen…

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