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The EGA at a Glance

The EGA at a Glance. Brussels, 27th September 2012 Greg Perry EGA, Director General. EGA - introduction. Established in 1993 Based in Brussels International non-profit organisation under Belgian law (ASBL). Pan European (not only EU) Representing over 1000 companies

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The EGA at a Glance

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  1. The EGA at a Glance Brussels, 27th September 2012 Greg Perry EGA, Director General

  2. EGA - introduction Established in 1993 Based in Brussels International non-profit organisation under Belgian law (ASBL). Pan European (not only EU) Representing over 1000 companies Around 60 direct members Direct membership for both companies and national associations different categories

  3. EGA Vision as An Industry To Provide Affordable High Quality Medicines for European Patients and Ensure the Sustainabilty of Our European Health Care Systems

  4. EGA Spheres of ActivitiesOur Key Objectives Minimizing Costs Increasing Market Share EGA Improving Competitiveness Promoting sustainable pricing Quicker Access to the market (STM)

  5. Challenges for the European Generic Medicines Market

  6. Inquiry Identifies Generic Delays

  7. Delaying Strategies Used by Originator Companies Source: Final report Sector Inquiry, July 09 7 7

  8. EGA Structure • EGA Committees • Regulatory & Scientific Affairs Committee • Legal Affairs & IP Committee • Health Economics Committee • National Associations Committee • European BioPharmaceutical Group • Working Groups are established to work on specific issues

  9. EGA Structure

  10. Drivers of EU Public Health Policy for Pharmaceuticals

  11. EGA Objectives • To Promote • The sustainability and competitiveness of the European generic and biosimilar medicine industry; • European, national and regional measures which increase market access to generic and biosimilar medicines;

  12. EGA Objectives • To Promote • The creation of a European regulatory and IP framework that ensures immediate access to the post patent market for generic and biosimilar medicines; • Global adoption of high quality EU like standards for APIs, generic medicines and biosimilar medicines.

  13. EGA Network

  14. Co-decision: Overview of the EU ‘Institutional Triangle’ • Guardian of the EU Treaties; • Protects the community interest; • Sole right of legislative initiative EUROPEAN COMMISSION • Representing EU population • Representing Member States COUNCIL OF MINISTERS EUROPEAN PARLIAMENT

  15. As an example… Review of the Transparency Directive

  16. Review of the Transparency Directive • Directive 89/105/EEC creates harmonised provisions to ensure the transparency of national pricing and reimbursement of medicinal products • Why a review? • Distortions of internal trade in medicines caused by national health expenditure controls • One of the key recommendations of Sector Inquiry

  17. Transparency Directive:EGA priorities Introduce shorter price & reimbursement approvals for generic and biosimilar medicines Stop patent linkage on price and reimbursement procedures for generic and biosimilar medicines Eradicate double bioequivalence assessment by price and reimbursement authorities for generic and biosimilar medicines

  18. Timelines : discussions started in the EP… Rapporteur: Antonia Parvanova (ALDE, BG)

  19. …But still major opposition amongst Member States • Opposition araisesfromMember States: • Desagreewith sanctions systems • Desagreewith extra administrative burden • Desagreewithtoo short timelines The proposalmightbeblocked in the Council

  20. European Generic Medicines Market Victor Lino Mendonça Head of Pharmaceutical Policy & Health Economics

  21. EGA Key Fact and Figures

  22. Generic Medicines Market Share in Europe

  23. In an era where increasing demands are being made on Europe’s healthcare services and payers due to Ageing population Increasing access to the health systems New and expensive treatments Pressure on governments to reduce deficits Generic medicines help payers to better manage their budget Ensures patient access medicines Reducing the cost of pharmaceutical care. With the same money more patients are being treated As a result of their lower prices, the availability of generic medicines improves the cost-effectiveness of existing pharmacotherapy and may make it cost-effective to manage previously untreated patients; Gains of Generics Medicines

  24. Savings from increasing generic medicine market share in 5%, for common diseases affecting the elderly in Europe, will save 4Bn€/year in Europe (2009). • Simoens Report

  25. Recommendations to sustain European generic medicines markets • 1. Introduce a coherent generic medicines policy • A generic medicine policy requires both supply-side measures relating to pricing and reimbursement and demand-side incentives for physicians, pharmacists and patients • Different policy measures need to reinforce each other and be part of a coherent generic medicines policy.

  26. Recommendations to sustain European generic medicines markets • 2. Encourage price differentiation/competition within existing regulatory frameworks • Price differentiation is the driver of Generic Medicines • RPS does not aid generic medicines penetration: • if prices of originator medicines drop to level of RP (e.g. Belgium, Italy) • if prices of originator medicines drop to level of Generics (e.g. Spain) • if patients do not incur co-payment (e.g. France)

  27. Recommendations to sustain European generic medicines markets 3. Disseminate pricing information to actors Information about the price difference between originator and generic medicines need to be communicated to relevant actors, thus creating an incentive for physicians to prescribe, pharmacists to dispense, and patients to ask for generic medicines.

  28. Recommendations to sustain European generic medicines markets 4. Increase confidence of actors in generic medicines National medicine agencies need to play a more active role in communicating the availability and bio-equivalence of generic and originator medicines to physicians, pharmacists and patients.

  29. Recommendations to sustain European generic medicines markets • 5. Provide incentives for physicians to prescribe generic medicines • Generic medicine prescribing can be encouraged by: • Making medical students aware of prescribing by INN • By demonstrating to physicians the amount of savings that can be made from generic medicines use • By supporting physician prescribing with electronic prescribing systems, audit of and feedback on prescribing data, prescribing guidelines and formularies, substitution lists, and local pharmacotherapeutic discussions between physicians and pharmacists • These policy tools need to be accompanied by rewards/sanctions for physicians who do/do not adhere to them, respectively • Doctor budgets reduce pharmaceutical expenditure and increase generic medicine prescribing(budgets (e.g. Germany, Ireland, England))

  30. Recommendations to sustain European generic medicines markets • 6. Remove financial disincentives for pharmacists to dispense generic medicines • Pharmacists need to receive a remuneration that does not financially penalise them for dispensing generic medicines.

  31. Recommendations to sustain European generic medicines markets • 7. Provide incentives for patients to demand generic medicines • Countries need to incite patients to demand generic medicines. This may take the form of financial incentives that reduce co-payment on generic medicines or impose higher co-payment on originator.

  32. Market access of generic medicines – Obstacles • Delays in P&R Procedures – Transparency Directive • Shortcomings in procedures governing intellectual property protection (e.g. patent linkage, evergreening tactics), data and marketing exclusivity, and marketing authorization; - Sector Inquiry • Prescription switch to patent protected medicines

  33. Generic medicines pricing in Europe - Threats In price-regulated countries, 37% have price linkage (generic price is % below the originator price) • What should be minimum price difference between generic and originator medicines? • May incite strategic behaviour by originator company • Price of generic medicine is determined by main competitor

  34. Generic medicine pricing in Europe - Threats • Extreme price cuts in generic medicine prices • International reference pricing - Selection of countries with lower price levels in generic medicine price referencing system / Ad hoc measures implemented in context of the current financial and economic crisis put additional pressure on generic medicine prices in Europe

  35. Generic medicine pricing in Europe - Threats Tendering • Pharmaceutical savings can be achieved in short term, but the overall results in long term are unclear; • The implementation of tendering systems is accompanied by significant costs related to logistics for medicine procurement and for substitution management, and data processing costs • Short-term absences of some medicines due to logistic shortages

  36. Trends • Growing consumption of medicines in the EU • Growing market share of generic medicines • Growing concern about the affordability of medicines and the need for cost containment • Significant downward price trend of generic medicines • Expiration of patents • New Generics and biosimilars coming to the market

  37. Trends • High concern for quality and safety • Growing regulatory costs for safety and quality (falsified / PharmacoVig) • Demand for new products to reduce key diseases • Innovation to be boosted ... • Global Competition • Impact on jobs and economic growth in Europe

  38. THANK YOU FOR YOUR ATTENTION

  39. Europe’s potential as a global hub for pharmaceutical manufacturing: How to increase the competitiveness of Europe’s biosimilar and generic medicines industry Ilina Markova Industrial Policy and Corporate Responsibility Coordinator, EGA Brussels 27 September 2012

  40. EGA Objectives • Improve patient access by creating affordable therapies • Guarantee high levels of patient safety and product quality • Help the sustainability of European healthcare systems • Increase European competitiveness and employment opportunities

  41. “Europe 2020” • Three mutually reinforcing priorities: • Smart growth: developing an economy based on knowledge and innovation. • Sustainable growth: promoting a more resource efficient, greener and more competitive economy. • Inclusive growth: fostering a high-employment economy delivering social and territorial cohesion.

  42. Key Economic Trends 2010/11 Source: ILO Global Employment Trends 2011

  43. Global Employment Trends 2011

  44. Pharmerging Countries Have Grown in Importance within the Global Generics Business since 2004Major Europe losing ground 2004 2010 Pharmerging market Source: IMS Health, MIDAS, Market Segmentation countries, MAT Dec 2010 , Rx only. China and Russia from Licensing Data Source: IMS Health 2011 (*) at ex-man price level

  45. Opportunities • New emerging markets with high purchasing power (Russia, China, Middle East, Africa) • Demographic changes (ageing and growing populations) both in Europe and globally • Patent expiries in developed countries

  46. Global Generics Market is an Opportunity for the EU Industry Expected 10% annual net growth in generics market; market to reach € 92 billion in 2012. Key for emerging markets with increasing use of generics. +10% +8% +11% +13% +10% +12% +10% Rest of World Source: IMS Health, MIDAS

  47. Hurdles for export outside Europe • Strong government support for local producers (e.g. India, South Korea, Taiwan) • India - the number of facilities with generic medicines applications grew from 8 in 1992 to 963 in 2008 (Source: FDA) • Difference in quality standards • Biosimilars v/s Non-comparable follow on biologicals • Trade partner tariffs and indirect taxes • Europe –a general zero tariff policy on pharmaceuticals we should expect the same from our trade partners • EU restrictions for manufacturing for export (IP)

  48. India’s Industrial Policy For Pharmaceuticals • “A government task force will evolve strategies for making India a hub for drug discovery …. further the interests of Indian pharma industry ….and recommend strategies to capitalise on the opportunityof $60 to $80 billion drugs going off-patent over the next five years.” • Source New Delhi, March 15 (IANS)

  49. South Korea’s Industrial Policy For Biosimilars • “The South Korean Government has pledged to promote the biosimilars industry and plans to invest in the biosimilars industry in order to make Korea a market leader. The government will provide both financial and institutional support and is aiming to take a 22% share of the global market by 2020.” • Source: Korea Herald

  50. Export Loss of EU Generic and Biosimilar Medicines Industry Date of international competition 20 year patent + Up to 5 year SPC Period of market loss to EU companies

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