The Medical Research Act

The regulations on the agreement of "secret prices" initially formulated in the early drafts of the law were adapted and made more challenging through amendments following extensive criticism, particularly from the health insurance funds.

In principle, pharmaceutical companies only have the option of a confidential reimbursement amount from the first time a medicinal product with a new active ingredient is placed on the market. However, the option to choose a confidential reimbursement amount is limited to a period until June 30, 2028. This option will therefore no longer exist for medicinal products for which a reimbursement amount is agreed or set after this date. Medicinal products that are already on the market are still excluded from this option. In addition, the pharmaceutical company must provide evidence of a drug research department in Germany and relevant own projects and collaborations with public institutions in preclinical or clinical drug research in Germany in order to be allowed to choose the confidentiality of the reimbursement amount. The decision as to whether the requirements are met is the responsibility of the National Association of Statutory Health Insurance Funds (GKV-SV) or the Arbitration Board in the event of a negative decision by the GKV-SV. However, it is unclear what evidence pharmaceutical companies must provide and what criteria the GKV-SV or the Arbitration Board will use to decide whether these requirements are met.

In the case of confidentiality of the reimbursement amount, which can only be claimed at the request of the pharmaceutical company after a reimbursement amount has been negotiated or determined by the Arbitration Board, an additional mandatory discount of 9% on the reimbursement amount negotiated or determined in accordance with section 130b SGB V is due. In addition to this now mandatory discount, the law still provides for the reimbursement of excess wholesale surcharges and pharmacy markups paid in accordance with the German drug price regulation (“Arzneimittelpreisverordnung”) as well as the excess VAT paid by the health insurance funds. This will probably make the confidentiality of the reimbursement amount so economically unattractive for most pharmaceutical companies that there will be confidential reimbursement amounts in only a few cases.

In addition, for preservation of the economic efficiency principle, the electronic programs used by contract physicians for prescribing must now contain mandatory information on the economic efficiency of the medicinal product compared to competing products. This means that confidentiality of the reimbursement amount does not automatically ensure economic efficiency, so that the strategic importance of confidentiality regarding better market penetration is hardly given.

Due to the economic losses, a precise analysis of the opportunities and risks of the confidentiality of the reimbursement amount in individual cases is essential for understanding the implications for the business case. It remains to be seen to what extent pharmaceutical companies will make use of this option and how the GKV-SV and the Arbitration Board will define the requirements for the possibility of a confidential reimbursement amount specified in the law. However, with the current structure of the confidentiality of reimbursement amounts in Germany, it can be assumed that publicly visible reimbursement amounts will continue to be the norm for medicinal products on the German market.

Sources:

• https://www.bundesgesundheitsministerium.de/presse/pressemitteilungen/bundesregierung-beschliesst-medizinforschungsgesetz-pm-27-03-2024
• https://www.bundesregierung.de/breg-de/bundesregierung/gesetzesvorhaben/kabinett-medizinforschungsgesetz-2267762
• https://www.pharmazeutische-zeitung.de/lob-und-kritik-am-medizinforschungsgesetz-148458/seite/2/?cHash=28a1631c868b5a9a6767e1e5646cfdff
• Amendment to the Medical Research Act of July 01, 2024 (BMG/BMUV)