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ACM sees opportunities for lower prices of ‘expensive prescription drugs’

19-02-2019

The Netherlands Authority for Consumers and Markets (ACM) keeps a close watch on the trends and developments in prescription drugs. One such recent development concerns the manufacturing of orphan drugs by pharmacies (independent ones and hospital pharmacies). This ‘magistral preparation’, as it is called, provides opportunities for lower prices of ‘expensive drugs’, as it paves the way for cheaper alternatives. ACM makes sure that drug manufacturers and suppliers of raw materials do not put up any unjustified barriers against magistral preparation, for instance by restricting access to raw materials or by applying unreasonable conditions. At the same time, ACM reminds hospitals and health insurers of the opportunities for collective procurement of drugs. By combining their purchasing volumes within the Netherlands and abroad, they will be able to negotiate lower drug prices.

What does ACM do?

In 2018, ACM put ‘prescription drug prices’ on its agenda, because of the public debate about drug prices and the pressure on health care costs. In that context, ACM launched several investigations. For example, ACM is investigating the high prices of CDCA, manufactured by Leadiant, following a request for enforcement by the Pharmaceutical Accountability Foundation (in Dutch: Stichting Farma ter Verantwoording). The question in this case is whether Leadiant is abusing its dominant position. As part of the investigation, we are closely following the developments regarding magistral preparation by the Amsterdam Academic Medical Center (Amsterdam UMC). The potential success of magistral preparation in this case is relevant, because it may offer patients an alternative. ACM is also conducting a sector inquiry into anti-rheumatic drugs.

Orphan drugs

Orphan drugs are drugs with a special status. These involve drugs for small groups of patients with specific conditions. The European Medicines Agency (EMA) is responsible for designating drugs as orphan drugs, using various criteria. With this special status, the manufacturer is able to market this drug exclusively for a period of 10 years, for example in order to recoup development costs. One exception to this exclusivity is magistral preparation. This means that a pharmacist is allowed to make the drug themselves under certain conditions.

See also:

23-06-2016 Guidelines on collective procurement of prescription drugs

Prescription drug prices