The German Bundestag is implementing a number of pharmaceutical policy changes within the scope of the 14th law amending Book V of the German Social Code, including an extension of the drug price freeze to 2017.

Birgit Fischer, CEO of vfa, commented on behalf of researching pharmaceutical companies, saying, “The law will set an important direction for the German healthcare system. The benefit assessment of the existing market, which is considered by the Joint Federal Committee (GBA) to be barely feasible will, for example, be abolished. Also, in view of the high surpluses of the health insurers, the mandatory discount of the pharmaceutical industry will be decreased. We welcome both of these decisions, which we also believe are correct.”

“However, freezing the prices of medicinal products in Germany with a long-time price moratorium without compensation for inflation will disempower the pharmaceutical companies, leading to a situation which can no longer be deemed a market economy,” she said. “Cost increases for companies cannot be passed on and refinanced. This in turn leads to gradual expropriation, giving rise to serious constitutional concerns. Between 2009 and 2013, the financial burden on the industry resulting from the price moratorium alone has amounted to about $2.75 billion. If the price freeze to the price level of 2009 continues, the yearly financial burden will increase to $1.4 billion in 2014 and $1.65 billion in 2015. A long-standing price moratorium thus at least requires consideration of the general price development. In our opinion, this should be done by adjusting the price level to the rate of inflation and should be restricted to a clearly limited time frame.”

Fischer concluded, “Clearly, not enough time was dedicated to the legislation process, leaving insufficient time to consider the consequences and for discussion. The politicians have not done themselves a favor with this. It has not been sufficiently discussed how the fixed-price system and reimbursement system will harmonize with one another in the future without jeopardizing the healthcare system. We are risking a trial and error procedure of the healthcare system at the patients’ expense.”