Europe’s Value Added Medicines Initiative
- Posted by: Jennifer
- Published on: June 20, 2018
The European Union (E.U.) and the United States (U.S.) both have regulations that allow existing drugs to be improved. The E.U. pathway is limited to improvements of drugs that were approved in the E.U. and that are now generic. Readers of this blog are familiar with the U.S. 505(b)(2) pathway that is not restricted to the underlying drug product. In either jurisdiction, pharma companies spend considerable time and money to make changes that will benefit patients. In the U.S., pharma and the market (payers, etc.) set pricing and determine profitability, while in Europe, prices are generally fixed by the relevant health authorities. Generally, the economics in Europe have not been sufficient to recoup the investments. Recently, European pharma companies formed a Value Added Medicines (VAM) trade group to establish a sustainable market model that incentivizes R&D and access to these medicines in Europe.
Last week (June 2018) in Budapest, I participated in a panel discussion with members of the VAM group, representatives from IQVIA, and other pharma companies. IQVIA presented an overview of the markets in Europe. Generally, payers’ (e.g., the health authorities) perception of value added medicines varies across the E.U. member states and is typically unfavorable; price is not proportional to the R&D investment. Further, pharma typically just conducts studies for approval and not market access – post-marketing studies to show superiority are often requested.
My remarks were directed toward the features of the U.S. system that might be useful and adapted (not adopted directly as that won’t work!) to proposed new legislation in the E.U. In particular, we discussed the concept of market and data exclusivity. This concept protects an investment from generic competition. While appealing, Europeans are worried that it could lead to evergreening. Further, I discussed how Camargo bases its practice on the Target Product Profile (TPP) to inform how studies should be designed with commercial success as the goal rather than simply regulatory approval; TPP should be based on input from the market (Health Care provides, payers, patients and their advocacy groups, etc.). The TPP then drives study designs and endpoints, which may include existing comparators and/or standard of care.
Consistent with Camargo’s mission to bring improved medicines to the world’s population, we will partner with VAM to assist in their efforts to expand the opportunities for gaining access to these improved drugs for patients in the European markets.
Author: Ken Phelps, President and Founder, Camargo Pharmaceutical Services
Photo credits: Medicines for Europe