Germany is one of the largest and most influential pharmaceutical markets in Europe, with a population of over 80 million people and a health care system that covers almost everyone. However, in recent years, some drug manufacturers have decided to withdraw their products from the German market, citing various reasons such as price pressure, regulatory hurdles, or lack of additional benefit. In this blog post, we will explore the reasons behind these withdrawals, the impact on patients and doctors, and the possible future trends in the German drug pricing and reimbursement system.
What is the new reimbursement law in Germany and how does it affect drug pricing and reimbursement?
The new reimbursement law in Germany is called the Act for the Financial Stabilization of Statutory Health Insurance (Gesetz zur finanziellen Stabilisierung der gesetzlichen Krankenversicherung or GKV-FinStG). It is a law that was introduced in 2022 to reform the German pharmaceutical market and contain the rising costs of drugs for the statutory health insurance (SHI) funds. The law encompasses significant cost-containment measures that affect almost all players within the healthcare system, including the health insurers, doctors, hospitals, pharmacies and, especially, the pharmaceutical industry. Some of the key elements of the GKV-FinStG that apply to the pharmaceutical industry include the following measures:
Changes to the AMNOG market access rules
AMNOG stands for Arzneimittelmarkt-Neuordnungsgesetz, which translates to Pharmaceuticals Market Reorganisation Act. It is a law that was introduced in 2011 to regulate the pricing and reimbursement of new drugs with a new active ingredient in Germany. Under AMNOG, drug manufacturers can still set the initial list price when they launch a new drug in Germany, but they have to submit a dossier to the Federal Joint Committee (G-BA) within three months of market authorization. The G-BA is the highest decision-making body of the joint self-government of physicians, dentists, hospitals, and health insurance funds in Germany. It issues directives for the benefit catalogue of the SHI funds, which specifies which services are reimbursed by the SHI funds.
The G-BA conducts a benefit assessment of the new drug, based on the dossier and other sources of evidence, to determine whether it offers an additional benefit over existing treatments for the same indication. The G-BA can delegate this task to the Institute for Quality and Efficiency in Health Care (IQWiG) or third parties. The G-BA has six months to make this assessment and award the drug a final rating of between one and six. Level 1 denotes “extensive benefit” over a chosen comparator, while Level 6 means “less benefit” than the comparator. The same product can receive different ratings based on patient subgroups within the product’s licensed indication.
Based on these ratings, the manufacturer then enters negotiations with the National Association of Statutory Health Insurance Funds (GKV-SV), which represents all the SHI funds, to set the reimbursement price. The reimbursement price is defined as a discount on the initial list price and applies from 12 months after market launch. If no agreement can be reached within six months, an arbitration board will make a final decision on the price.
The main factors considered in these negotiations are:
- Annual costs of the appropriate comparator therapies
- Additional benefit level determined by the G-BA
- Prices of comparable pharmaceuticals within the same authorized indication(s)
- European prices in the reference countries
- Number of patients in the target indication
AMNOG aims to ensure that new drugs are priced according to their value for patients and society, and that SHI funds pay fair prices that reflect their additional benefit. However, some critics argue that AMNOG imposes too many restrictions and uncertainties on drug manufacturers.
The GKV-FinStG introduces several changes to the AMNOG process that make it more challenging for drug manufacturers to launch their products in Germany. These changes include:
- Shortening of free pricing period: Under the new law, the reimbursement price agreed or determined under AMNOG applies already after seven months after product launch – instead of 12 months as before. This reduces the period during which drug manufacturers can set their own prices for their products by five months.
- Tightening of price negotiations: Under the new law, if no agreement can be reached between drug manufacturers and GKV-SV within six months after benefit assessment by G-BA, an arbitration board will make a final decision on price based on a formula that takes into account only two factors: (1) European prices in reference countries; and (2) additional benefit level determined by G-BA. This means that other factors such as annual costs of comparator therapies or number of patients are no longer considered. Moreover, if a product receives a “no additional benefit” rating by G-BA, the arbitration board will set the price at a level that ensures a discount of at least 25% on the initial list price.
- Sanctioning of uneconomical package sizes or dosages: Under the new law, if a product has allegedly uneconomical package sizes or dosages that cause a discarding of non-administered excess quantities of drug substance, the reimbursement price agreement or arbitration decision can include further price markdowns or other measures to ensure economic efficiency.
The GKV-FinStG aims to reduce the spending of SHI funds on drugs and to increase their bargaining power in price negotiations. However, it also increases the risk and uncertainty for drug manufacturers who may face lower prices, shorter free pricing periods, and stricter conditions for their products in Germany.
Which drugs have been withdrawn from the German market after the new reimbursement law and why?
Some of the drugs that have been withdrawn from the German market after the new reimbursement law are:
- Rybrevant (amivantamab), a lung cancer drug by Janssen. Rybrevant was approved by EMA in May 2021 for adults with locally advanced or metastatic non-small cell lung cancer (NSCLC) with activating EGFR exon 20 insertion mutations, after failure of platinum-based chemotherapy. In July 2021, the G-BA concluded “no additional benefit” for Rybrevant in both subgroups of patients, based on indirect comparisons with registry data. Janssen decided to withdraw the drug from the German market in August 2021, before the price negotiations were completed, to avoid a low public reference price that could affect other markets. Janssen stated that they will continue to provide Rybrevant to patients who had already started therapy through importation.
- Zynteglo (betibeglogene autotemcel), a gene therapy for beta thalassemia by bluebird bio. Zynteglo was approved by EMA in June 2019 for patients 12 years and older with transfusion-dependent beta thalassemia who do not have a matched related donor for stem cell transplant. In August 2021, bluebird bio announced that they were withdrawing Zynteglo from the German market after failing to reach an agreement with health authorities on the treatment’s price. Bluebird bio had proposed a value-based payment model that would link the reimbursement price to the clinical outcomes of patients over five years. However, the G-BA and the GKV-SV rejected this model, arguing that it was not compatible with the German legal framework and that it would create administrative and financial burdens for the SHI system. Bluebird bio also stated that they will not launch Zynteglo in other European markets until they have more clarity on the regulatory and reimbursement environment.
- Opdualag (nivolumab and relatlimab), a cancer drug by Bristol Myers Squibb. Opdualag is a combination of Opdivo (nivolumab) and a new antibody relatlimab. It is used to treat advanced melanoma in certain adults and adolescents aged 12 years and older. Bristol Myers Squibb announced that they will not launch Opdualag in Germany, citing price pressure from health authorities and a low public reference price.
- Tabrecta (capmatinib) developed by Novartis was removed from the market in Germany due to “issues” with the AMNOG system. In February, the Federal Joint Committee (G-BA) voted that the added benefit of Tabrecta was “not proven” for treating advanced non-small cell lung cancer with specific genetic mutations. In February, the Federal Joint Committee (G-BA) voted that the added benefit of Tabrecta was “not proven” for treating non-small cell lung cancer (NSCLC) when the cancer is advanced, and its cells have particular genetic mutations (changes) leading to mesenchymal-epithelial transition factor gene exon 14 (METex14) skipping, as there “were no suitable data for the benefit assessment” in all three patient sub-populations that were assessed. Following this decision, Novartis was unable to reach an agreement with the GKV-Spitzenverband regarding a rebated price for the therapy.
Tabrecta was launched in Germany at a public price of EUR 120,000 per patient, per year. Withdrawing from the market in Germany means that Novartis will not have a rebated price published in Germany, which could potentially then have been used for other countries’ international reference pricing (IRP) practices. Current stocks of Tabrecta are expected to last until around March 2024, which means patients already receiving therapy will be able to continue with their treatment until then. Thereafter, Tabrecta will be available only through named-patient schemes, for which health insurance funds will first have to approve reimbursement.
|Year of withdrawal
|Reason for withdrawal
|No additional benefit appraisal by the G-BA; low public reference price 1
|Zynteglo (betibeglogene autotemcel)
|Failure to agree on a price with health authorities; incompatible payment model 2
|Opdualag (nivolumab and relatlimab)
|Price pressure from health authorities; low public reference price
|Issues with the AMNOG system; low public reference price
What is the impact of drug withdrawals on patients and doctors in Germany?
The withdrawal of drugs from the German market can have negative consequences for patients and doctors who may lose access to important treatment options, especially for rare or severe diseases where there are few or no alternatives available. Patients may face delays in accessing new drugs, reduced quality of life, increased morbidity and mortality, and higher out-of-pocket costs if they have to pay for imported drugs or travel abroad for treatment. Doctors may face difficulties in prescribing optimal therapies for their patients, reduced clinical autonomy, increased administrative burden, and ethical dilemmas.
Some patient groups and medical societies have expressed their concerns and dissatisfaction with the current AMNOG system and its outcomes. They have called for more transparency, flexibility, and patient involvement in the benefit assessment and price negotiation processes. They have also advocated for more consideration of patient-relevant outcomes, such as quality of life, symptom relief, and patient preferences, rather than focusing solely on survival or surrogate endpoints. They have also urged for more alignment and consistency between clinical guidelines and HTA appraisals, as well as more harmonization and collaboration across European countries.
What are the possible future trends in the German drug pricing and reimbursement system?
The German drug pricing and reimbursement system is constantly evolving and adapting to new challenges and opportunities in the pharmaceutical market. Some possible future trends are:
- More use of real-world evidence (RWE) to complement or replace randomized controlled trials (RCTs) in benefit assessment and price negotiation. RWE can provide more relevant and timely information on the effectiveness, safety, and value of drugs in routine clinical practice, especially for rare diseases, personalized medicines, or complex interventions. However, there are still methodological, ethical, and legal challenges to overcome before RWE can be widely accepted and used by all stakeholders.
- More use of innovative payment models to address uncertainty, risk-sharing, and affordability issues. Innovative payment models can include outcomes-based agreements, annuity payments, indication-specific pricing, or subscription models. These models can link the reimbursement price to the actual performance or utilization of drugs in real-world settings, thereby reducing uncertainty, aligning incentives, and ensuring value for money. However, these models also require robust data collection and analysis systems, clear contractual arrangements, and administrative feasibility.
- More integration and coordination of HTA activities at the European level to reduce duplication, inconsistency, and fragmentation across countries. The European Commission has proposed a regulation on health technology assessment that aims to establish a permanent framework for cooperation among EU member states on joint clinical assessments of new medicines and medical devices. The regulation would also facilitate joint scientific consultations, identification of emerging health technologies, and voluntary cooperation on other aspects of HTA. However, the regulation faces opposition from some member states and stakeholders who fear losing their national sovereignty and flexibility in decision-making.
The German pharmaceutical market is undergoing significant changes due to the new reimbursement law that came into effect in 2022. The law introduces several cost-containment measures that affect the pricing and reimbursement of new drugs with a new active ingredient in Germany. The law also increases the risk and uncertainty for drug manufacturers who may face lower prices, shorter free pricing periods, and stricter conditions for their products in Germany. As a result, some drug manufacturers have decided to withdraw their products from the German market or not launch them at all. This can have negative consequences for patients and doctors who may lose access to important treatment options. However, the law also creates opportunities for innovation and collaboration among stakeholders who can use real-world evidence, innovative payment models, and European cooperation to improve the access and value of drugs in Germany.
What is the difference between opt-outs and supply terminations?
Opt-outs are drugs withdrawn from the German market within two weeks of price negotiations with the GKV-SV. Supply terminations are drugs that are withdrawn during or after further price negotiations, either before or after the arbitration board’s decision. Opt-outs and supply terminations can have different implications for the manufacturer, such as the possibility of re-entering the market, the impact on other markets, and the legal consequences.
What are the reference countries for Germany in price negotiations?
The reference countries for Germany in price negotiations are France, Greece, Italy, Spain, and the United Kingdom. These countries are chosen based on their population, economic power, and pharmaceutical market size. The GKV-SV compares the prices of comparable pharmaceuticals within the same authorized indication(s) in these countries and uses them as a benchmark for setting the reimbursement price in Germany.
What are the criteria for choosing a comparator therapy for benefit assessment?
The criteria for choosing a comparator therapy for benefit assessment are defined by the G-BA in its directives. The comparator therapy should be:
– An appropriate treatment alternative for patients
– A treatment that is reimbursed by the SHI funds
– A treatment that is established in medical practice
– A treatment that has proven efficacy and safety
The G-BA can also consider other factors, such as patient preferences, ethical aspects, or economic efficiency.
How can patients access drugs that are withdrawn from the German market?
Patients can access drugs that are withdrawn from the German market through different ways, depending on the availability and affordability of the drugs. Some possible ways are:
Importation: Patients can import drugs from other countries where they are available, either through their doctors or pharmacies or through online platforms. However, this may entail additional costs, legal risks, or quality issues.
Travel: Patients can travel to other countries where they can receive treatment with the drugs they need. However, this may involve travel expenses, logistical challenges, or health risks.
Compassionate use: Patients can request access to drugs that are not authorized or available in Germany through compassionate use programs. These programs allow manufacturers to provide drugs free of charge or at a reduced price to patients with life-threatening or seriously debilitating diseases who have no satisfactory alternatives. However, these programs are subject to strict conditions and limitations and depend on the manufacturer’s willingness and ability to supply the drugs.
How can drug manufacturers avoid or reduce the risk of withdrawal from the German market?
Drug manufacturers can avoid or reduce the risk of withdrawal from the German market by adopting various strategies, such as:
– Generating high-quality evidence that demonstrates the additional benefit of their products over existing treatments, using relevant endpoints, patient populations, and comparators
– Engaging early and proactively with health authorities, payers, doctors, and patients to understand their needs, expectations, and perspectives
– Developing innovative payment models that address uncertainty, risk-sharing, and affordability issues
– Seeking alignment and consistency with clinical guidelines and HTA appraisals across European countries