Study on implementation published.

The Transparency Directive on Pricing and Reimbursement of Medicinal Products (89/105/EEC) has been in existence since 1989, when the European Union (EU) was still called the European Community. The aim of this directive is to ensure the transparency, objectivity and comprehensibility of the decisions on the pricing and reimbursement of medicinal products in the EU Member States. It defines the procedures that the Member States must apply when they set prices for medicinal products or regulate their inclusion in reimbursement systems. The authors of a new study by the European Commission maintain that a "continuous evaluation of the Directive" is needed to ensure that it can serve its intended purpose.

Transparency for the single market

The Transparency Directive was introduced to strengthen the free movement of medicinal products within the EU and promote the single market. It is intended to ensure that national measures on pricing and reimbursement of costs do not hinder intra-European trade and do not distort competition in the single market. The Directive does not interfere with national decisions on the setting of pharmaceutical prices or social security policies. Member States remain free to set their own pricing and reimbursement rules as long as they comply with the procedural requirements of the Directive.

For example, the Transparency Directive stipulates that decisions on the pricing and reimbursement of medicinal products must be made within certain deadlines: within 180 days (90 days for pricing decisions, 90 days for reimbursement decisions or 180 days for combined decisions). It also obliges the competent national authorities to justify each of their decisions on the basis of objective and verifiable criteria and to provide the applying companies with appropriate legal remedies.

Need for reform?

The Directive is considered outdated in some cases owing to the changes that have taken place in the European pharmaceutical market over the last thirty years. The market structure has changed due to the increased number of generics and novel medicinal products as well as the more complex pricing and reimbursement policies of the Member States.

There have been political calls for a reform of the Transparency Directive for years. In spring 2012, the European Commission initiated a public consultation on potential revision of the Directive. On the basis of this consultation, the Commission proposed a whole new version of the Directive in March 2012 (COM[2012] 84) in order to fundamentally amend the essential provisions of the Directive. However, this legislative proposal was officially withdrawn in March 2015 as there was no agreement in sight in the Council.

Thirty years later, voices are once again clamouring for a necessary reform with a view to the new legislative period. For example, the S&D political group has explicitly included a revision of the Directive in its political priorities.

Study published

In this context, a study published by the European Commission on the implementation of the Transparency Directive draws our attention now. This attests to the need for reform.

Among other things, the authors note that there are different procedures for the publication of pricing and reimbursement decisions. For example, criteria and procedures are often published in official journals, while decisions appear on websites of health authorities. Pricing, price increases, profit controls and reimbursement decisions vary greatly between the Member States. Two thirds of Member States do not report their decisions directly to the European Commission, mostly because this information is publicly available or made available in databases.

There are also challenges when it comes to deadlines. Stakeholders, in particular the industry, consider compliance with the deadlines for pricing and reimbursement decisions by the Member States to be problematic. In around half of the Member States, pricing and reimbursement decisions are not always made on time. Some Member States are calling for more flexibility in complex decisions and clearer guidelines on the publication of prices.

Moreover, owing to rising pharmaceutical expenditure, many Member States have developed increasingly complex pricing and reimbursement procedures, such as new price negotiation models, market entry premiums, reference price systems or confidential price negotiations; this is also the case in Germany. According to the study, these developments are not sufficiently taken into account by the Transparency Directive.

No mandate for the new Commission

In principle, the study picks up on a long-standing discussion about the relevance of the Transparency Directive. Although the President of the European Commission, Ursula von der Leyen did not give the new Health Commissioner an explicit mandate to revise the Directive in her "mission letters", the debate on a reform has regained momentum.