BRUSSELS, Feb 24 (APM) - Competition among healthcare providers can improve efficiency in the use of resources in the European Union, the European Commission believes and a new study it has funded suggests tougher action on drug prices could make for even greater efficiency.
"Negotiation of prices can improve efficiency," says the opinion prepared by a panel of experts that the Commission set up to look at effective ways of investing in health.
The study cites pharmaceutical costs as accounting for up to 30% of healthcare expenditures in some countries.
As a positive example, it offers the experience of Spain, where "the regional health services and the ministry of health have created a coordinated procurement mechanism in order to obtain better prices, reinforcing the purchaser's bargaining power".
And it expects benefits for all member states from the EU's recent joint procurement agreement "which will enable EU countries to procure pandemic vaccines and other medical countermeasures as a group, rather than individually".
It urges strategies to increase the utilisation of generics. "Competition created by generics, that is entry of products with bioequivalence and thus close the notion of 'perfect substitutes', resulted in lower prices, according to evidence from several countries", it says."Price competition produced savings to payers."
It sees the threat of generic competition as a valuable incentive for patent holders to further invest in developing innovative medicines.
But it also sees the risk of countervailing action by patent-holders. "It may provoke unwanted strategic behaviour aimed at prolonging patents' life and delaying generic competition," warns the study.
Patents are depicted almost as inimical to patients' interests and something to be tightly controlled. It is "positive" that "more patents enter the same market of a first mover", but principally because "competition between innovators to develop new products with the same therapeutic purpose decreases the market power created by a single patent".
Based on this document, the Commission has launched a public consultation on how to promote competition among healthcare providers.
It is seeking feedback "from the scientific community and stakeholders" by April 8. It does note, however, that where the market "already has competition, additional elements of competition may have little impact overall, and the costs of promoting further competition may exceed its benefits."
Also, while tendering programmes for medicines "can achieve substantial savings in the short term", there are "potential problems and uncertainties regarding the long-term effect", particularly on the sustainability of the generic medicines industry and the availability of medicines.
The study ranges across all aspects of healthcare delivery, including primary care, hospital care and specialist care.
It also devotes a section to pharmacies, noting that "the existence of regulated markups over costs in many European countries has been considered as a motive for introducing (or strengthening) competition."
In addition, "incumbent pharmacies are often protected by entry restrictions" and lowering them "is likely to result in more competition, generating benefits for patients".
Sound policy evaluation studies are needed to assess and judge the impact of competition, because policy design and policy outcomes are likely to vary from one context to another, the study cautions.
"Key elements to consider when introducing, changing or increasing competition are ensuring market transparency, with availability of information on quality and prices, careful monitoring of access and equity effects, promoting health literacy, and enforcement of competition rules to prevent the creation, strengthening and abuse of dominant positions."
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