PharmaBoardroom recently conducted a roundtable event with the key opinion leaders of Algeria’s healthcare sector. The sector looks healthy on the surface: it has a market valuation of USD 3 billion, and double-digit sector growth. But now, Algeria must find a way to access more innovative treatments, accommodate existing local players in an ever-expanding market, and push government priorities, which currently include a massive expansion of Algeria’s domestic production capabilities. This is a sample of the conversation at our recent roundtable.
Frederic Boucheseiche – Publisher of PharmaBoardroom: There are differences – based on development level or population for instance – between the health systems of various European countries. Each system benefits different stakeholders in different ways, and all have their advantages and disadvantages. Can you provide us with an example of a system that works well, in your opinion?
Richard Torbett – Chief Economist, EFPIA (The European Federation of Pharmaceutical Industries and Associations): It’s a very difficult question. I might answer Denmark because I think it’s a good example. The industry gets good prices for its products. Broadly speaking, there’s good access to treatment. The off-patent market is very efficient, very open. Patients can easily access medicine. The growth rate of spending on pharmaceutical products is between two and three percent, howe- ver, while elsewhere this average is higher.
Habib Bennaceur – North & West Africa regional manager, AstraZeneca: In Algeria we often talk about improving our healthcare system, and when we do we compare ourselves to France, Germany, and other countries, and use them as a barometer for the pene- tration of innovative products. But we know very well that today in France, for example, the high level of medical service doesn’t come from scientific innovation, but from the size of the population and therefore the prices that can be negotiated between CEPS, who set prices, and CNAM, which provides repayment.
What standards should we use in order to find a satisfactory benchmark? Should it be based on innovation, or rather on prices and budgets? There’s a huge gap between the moment when a product is released on the market in the United States and in Europe. This is due to regis- tration delays, but also to phasing. We, as multinational companies, have to deal with phasing in terms of file submissions: we tend to start with the countries where clinical research has been conducted, so by the time our products reach Algeria, for example, we don’t have a huge window before the generic equivalents arrive.
Richard Torbett: No single system is perfect: there are advantages and drawbacks in every single one. I totally agree with what you said about France. For me, discussions between the industry and those that set prices should be a constant dialog. This is especially true as we begin to introduce new types of products such as personalized medicines – the only way to assess the value of such products is to invest in data for the whole treatment lifecycle, an idea that has already been accepted in the world’s best healthcare systems. These products would never work in a reimbur- sement system where all the medicines in a therapeutic category are assigned the same prices. But what do we do when we don’t have clinical trial data to give a value to a product and when the company comes and gives a higher price than the price of a product that has already shown its value? In most countries, when we have more data, we have more volume. And when we have more volume, prices usually go down. When there’s a contradiction between the way the world market works and an individual country, we run into problems.
In the United Kingdom a flexible pricing system has been on the statute books for aboutten years, but we have never had a chance for it to work out. We are in talks with NICE, the UK health authority, to understand why it didn’t work and how we can create a system that deals better with uncertainty.
The best solution we have come up with so far is to work with managed entry agreements. We control volume instead of first prices. The company is then able to gather real data. This way, across the product lifecycle, the company can have a reasonable discussion about a price that matches not only the data but also the volume.
Djaouad Bourkaib – Director General of Social Security, Ministry of Labor, Employment and Social Security: We are not likely to hurry to include personalized medicines to the list of refundable medicines, because what we spend on medicines is already huge compared to the health budget and it’s not sustainable.
We have to use our remaining resources to improve the other parts of the healthcare system. We have a price grid that is totally outdated. That is why we try to have a list that answers the medical needs of the population but without including anything we have doubts about.
On the other hand, when there’s a need that is not covered, we have no other choice.
When there is no convincing treatment for an illness, we accept uncertainty.
Djaouad Bourkaib: At that point we may think the way you think because there is an uncovered need and because we have no choice. We are in a very particular situation in Algeria: social security has to impro- ve the way it uses its resources, always keeping in mind what people need.
Badra Benkedadra – Advisor to the Minister of Health: As a regulator, what we are interested in, amongst other things, is the value of each medicine, and finding an efficient evaluation system. Mr. Toumi, Europe is evolving towards a European Health Technology Assessment (HTA) agency, which will be able to set up evaluations that all countries can share –including those outside of the system like Algeria. What do you think would be the best option for Algeria? Following the French or the British?
Mondher Toumi – Professor of Public Health, University of Aix Marseille, School of Medicine: I think it’s better to work on an Algerian way, as each country has its own environment, history, and culture. Algeria’s issue is that its population is decentralized, so access to medicine varies depending on whether you’re in a large city or a more remote area. We work with an extremely small budget, but also with extremely reliable but very expensive products knocking at the door. So the true question is how to arbitrate. In order to do so, you need a very well designed public healthcare system.
Djaouad Bourkaib: The statistical power of clinical trials is not to be underestimated. When we work on retros- pective studies, we find that more than 80 percent of the time, a medicine that has performed positively in clinical trials has gone on to have a positive effect among the general population. Clinical trials therefore remain an essential element.
When, in a country such as ours, a therapeutic indication is well covered by generic mole- cules that have shown good results, we will rarely move towards a new treatment that covers the same indication: we have budget limitations that must be respected.
There is a second question compared to economic efficiency. You are in favor of the quality-adjus- ted life year (QALY) to measure sanitary effects adjusted to quality, but evaluations are sometimes subjective: we can’t therefore say it’s the best criteria. It all comes down to measuring how QALY is defined, whereas using the differential on cost efficiency for a group of medicines combined with a test to check if the payer can afford those medicines could be interesting.
Mondher Toumi: Today, when we speak about efficiency there are two options. First, QALY, which helps autho- rities choose between all therapeutic interventions, but has limitations. Second is to measure efficiencies for each illness, but the downside is that this doesn’t allow you to arbitrate beyond each illness.
I think that QALY today remains unavoidable because we don’t have anything better for when you have to compare beyond illnesses. It has a great advantage: it includes quality of life – even if we may find that concept debatable.
Richard Torbett: On the cost-efficiency ratio, I often hear people saying that we have nothing better. There are some issues with this unit of measurement, I agree: its definition of quality is subjective. On an economic level, it’s a static optimization, not a dynamic one. And it doesn’t give answers to practical questions that are more important than the system is. It’s something to value only when looking at budgetary impact.
Nowhere in the world there is a definition of an ideal share of GDP to spend on health. I would rather spend 15 percent of my GDP if I could be sure I could guarantee a good quali- ty-price ratio, than spend ten percent of my GDP on a system than has no such controls.
There is also a real problem with rational allotment. When we say that there’s a cost-effec- tive medicine but that the budgetary impact is too high, then we absolutely must raise the question of whether we have a problem with rational allotment – a question that is even more important in decentralized systems.