HTA Expert Warns Of Escalating Measures If Pharma Fails To Tame Prices

European pricing and reimbursement authorities will have to take increasingly drastic measures, including prescribing restrictions and tendering for novel drugs, if pharmaceutical companies fail to reign in drug prices, warned Anja Schiel, a senior advisor at the Norwegian health technology assessment (HTA) body, NOMA.

The prices that companies ask for are increasingly high, despite a lack of clinical evidence to prove their benefits, she told the Pink Sheet in an interview. “It’s rather simple, we keep paying more and more and more, but we’re not buying more health,” she said.

The comments come at time when the US administration is threatening to slash drug prices through a most favored nations policy and speculation that companies may try to increase their prices elsewhere, including in Europe, to offset potential losses in the US. According to Schiel, European payers absolutely should not pay more for medicines (see also ‘Brainless’ US MFN Policy Could Drive Pharma Investment To Europe).

Schiel called on companies to better understand that they have “a social responsibility” to uphold. “Industry needs to work with us to maintain a sustainable health care system,” she said. “And if it doesn’t play along, then they shouldn’t be so surprised that there are stricter and stricter reactions and more and more unpopular, legal ways of containing prices and spending.”

She added that health systems “have been asking for a more demand driven, and less supply driven approach for a long time now. Yet it remains the approach of the industry to largely develop drugs, often me-too, that promise the biggest revenue, not drugs addressing real unmet needs.”

And in response to calls to make the sector a key driver for economic growth in the EU, Schiel rejected the notion that it should be down to the health care system to keep the industry afloat by buying products that are not backed by evidence. “Not everything that glimmers is gold,” she said.

Meanwhile, Novo Nordisk and EFPIA, the federation that represents pharmaceutical industry association, defended the sector’s track record in developing innovative products.

Rise In Spending

Public spending on pharmaceuticals continues to grow across Europe, said Schiel, pointing to a report from ESIP and MEDEV, which represent European social insurance organizations. The report found that rising prices, rather than the volume of medicines purchased, were the primary driver of increased public expenditure on hospital and pharmacy medicines.

The report, published in October 2024, was based on data from 16 ESPI/MEDEV members in countries including France, Germany, Italy, Spain, Sweden, the Netherlands, Norway and Belgium.

Unjustified Prices

Many of the high prices that companies demand for their new products are unjustified, Schiel declared. “The entire system is just getting more and more expensive. The money goes somewhere, but it most definitely doesn’t go, as the industry claims, on new drug development.”

She also rejected claims that the high prices reflect benefits brought by new innovation and development and production costs. “There isn’t that much innovation, and if prices were even remotely linked to development costs or production costs, even then some of the drugs should have been really very cheap.”

She pointed to Novo Nordisk’s weight loss drug Wegovy (semaglutide). “If you repurpose something, like Wegovy from Ozempic [Novo’s an anti-diabetic semaglutide drug], it should be dead cheap, but it isn’t.”

‘Uninformative Trials’

There is also a widespread problem of inadequate clinical studies, with companies frequently running trials that are “uninformative” when it comes understanding how effective the treatments really are, said Schiel.

Schiel highlighted the case of PD-L1s, of which there are many in development, even though the PDL-1s that are already on the market are a “classic example of me too drugs ... We don’t need any more unless they are better than the ones already on the market, yet we do not see any comparative studies that would answer the actual question if one of those drugs is really better than another one,” she argued.

According to Schiel, the “entire oncology field is covered with PD-L1s as monotherapies, combinations, and add-ons.” While the drugs treat many of the same disease areas, the available clinical evidence does not show that they offer any “differential benefits,” she said. “Rather, developers choose indications carefully to avoid competing with each other’s products.”

Companies have failed to conduct any head-to-head studies of PD-L1s and instead have conducted indirect comparisons that do not yield the robust evidence desired to show conclusive additional benefit, said Schiel.

Instead, the comparative trials include inappropriate comparators against which it is too easy to show the PD-L1 offers absolute benefit, she argued. “We want trials against an active, relevant comparator, not some chemotherapy we approved 10 years ago,” she said.

Too Much Uncertainty

There is currently too much uncertainty accumulating within health care systems, which makes funding decisions even harder, argued Schiel. If industry could remove some uncertainty in areas like standard oncology, which for example excludes rare cancers, there would be greater willingness to accept uncertainty, for example in diseases for which that randomized control trials “are really inappropriate,” she added.

“If every decision is made under high uncertainty, in the end, there is no uncertainty left and we cannot spend on orphan diseases, for which we have to pay millions of Euros upfront.”

Solutions

If drug prices continue to rise, payers will have no choice but to take spending control measures that will be deeply unpopular with industry.

For example, prices of PD-L1 inhibitors in Norway are now subject to tendering because the prices were deemed too high in relation to their proven benefits. “So if the clinicians tell us they do not know if there are meaningful differences between these drugs, then they all go in the same pot,” said Schiel. The move was deeply unpopular among companies, she noted.

Prescribing restrictions are another option and have been used to curb spending on Wegovy/Ozempic following a surge in demand. The ESIP/MEDEV report showed that medicines with an effect on the digestive organs accounted for just under 18% of pharmaceutical spending in 2023, contributing to an overall spending increase that year. “This can be explained by a large increase in sales of new blood sugar-lowering drugs that are used to treat type 2 diabetes and severe obesity,” it said.

According to Schiel, the drug responsible was semaglutide. She explained that expensive and uncontrolled parallel imports of Wegovy and Ozempic were being supplied to patients in Norway who were requesting both drugs amid a shortage of Ozempic. She noted that clinicians were not adhering to prescribing restrictions.

Novo Nordisk was resistant to attempts to reduce prices in order to contain spending, commented Schiel. In response, NOMA took action to reduce the volume of semaglutide prescriptions being issued and ensure they were available only to patients most in need. It stipulated that Ozempic could only be prescribed for national health service patients alongside an additional oral anti diabetic such as metformin. Wegovy is now only prescribed for patients with a BMI of over 32 and additional comorbidities.

Prescribing restrictions would ideally be a last resort, but “the harder the game gets, the more likely will we do these kind of things,” said Schiel.

Price Transparency And Independent Research

Another solution would be to increase transparency in prices so that payers across Europe can share more information on pricing. “We cannot share rebates or true prices … We compete with each other in a way that is unfortunate from a societal perspective.”

Schiel is also advocating for the creation of a new, independent European development center that would answer the questions that are commercially unattractive for industry to research. “We can understand that the industry isn’t willing to run studies that might decrease the value of their assets, but from a societal perspective saving lives and improving the quality of treatments must beat commercial interest every time.”

“There are too many drugs that the system doesn’t really need, yet areas where there are no drugs available at all,” she said.

Industry Response

In response to Schiel’s comments, Novo Nordisk told the Pink Sheet that it was an “oversimplification to view different treatments within the GLP-1 class as interchangeable.” Although both Wegovy and Ozempic both contain semaglutide, they are not the same drug. “Ozempic is approved for the treatment of Type 2 diabetes and Wegovy is approved for weight management. Their development required distinct clinical trials to establish efficacy and safety.”

The company added that it was “committed to working with health authorities to demonstrate that our GLP-1 treatments represent a cost-effective use of public resources.” It added that its GLP-1 were reimbursed at “no or low cost to patients” in most countries where they are available and that the company welcomes “conversations with policymakers to help develop solutions to ensure broad, affordable, access for all patients.”

Meanwhile, EFPIA told the Pink Sheet that innovation was “delivering tangible health outcomes.” It highlighted a report from the Swedish Institute for Health Economics (IHE) that noted that cancer-related deaths are starting to stabilize, even though the disease is projected to become the leading cause of death in the EU by 2035.

Survival rates for cancers such as breast, prostate, testicular and thyroid cancers, and Hodgkin lymphoma are now over 90% in top-performing countries, EFPIA commented. “These improvements are directly linked to continued pharmaceutical innovation,” it said, adding that such innovation was incremental and paves the way for “generational advancements.”

It said it fully supports the role of HTA in decision making and ensuring health systems receive value for money. “However, we believe that assessments must be grounded in meaningful comparisons and outcomes that truly matter to patients – whose perspective is so rarely and poorly considered.”

EFPIA added that “requiring head-to-head trials against old or outdated comparators can lead to waste and inefficient allocation of health care resources – without producing insights that enhance patients’ care.”

The federation also noted that “linking the price of medicines strictly to R&D costs risks undermining the very investment needed to drive impactful innovation” and pointed to the importance of value-based pricing.

“Value-based pricing aims to reflect the full benefit that treatments provide to patients, health care systems, and society. Moving to rigid, cost-based models might encourage a perverse circle of low investment developments and imperfect clinical trials (for example that are unreasonably long and ineffective) to the detriment of research and patient access to new therapeutic and potentially life changing options.”

EFPIA added that “availability challenges” remain in some markets and that data from its WAIT indicator shows that there has been some deterioration in the rate of availability of cancer medicines in Europe.

“Unilateral efforts cannot overcome the barriers that lie between the discovery of new treatments, the advancement of clinical research and making new products available for patients. There is clearly a need for a dialog, especially in the HTA space, to make the evaluation of new treatments both robust and fit for purpose.” it said.

The dialog must address modern trial designs, surrogate and patient-relevant endpoints, the role of combination therapies, innovative pricing models, and renewed investments in health care, said EFPIA. “These elements are key to enhancing Europe’s competitiveness in medical innovation.”