The European Parliament has voted for measures to speed up patient access to generic medicines.

The proposal to shorten the period for decisions on pricing and reimbursement of generic drugs from 180 days to 60 days was backed by 559 votes to 54.

Some member state governments are expected to resist the change, which could enable generic drug manufacturers to negotiate higher prices.

The deadline for new (branded) drugs would remain set at 180 days from regulatory approval, under rules that date back to 1989.

Bulgarian MEP Antonyia Parvanova, an architect of the new legislation, commented: “It is unacceptable that delays in the pricing and reimbursement of medicines can sometimes reach more than 700 days.”

The draft legislation would also require national health systems to publish an annual list of medicines available within each system and their prices, as well as the names and declarations of interest of the experts consulted.

While accepting that pricing and reimbursement are national responsibilities, the European Commission has stated the legislation will clarify these procedures and help to avoid unnecessary delays in access to generic drugs.

The proposed change may favour generic drug manufacturers in terms of pricing negotiations, as well as making the ‘patent cliff’ steeper for branded drugs.

The payment by results (PbR) system for healthcare reimbursement is unfit for meeting the changing needs of society, according to the King’s Fund.

The think tank identified the current tariff as a barrier to the shift of healthcare from hospitals to the community.

A range of payment systems would be needed, the report argued, to encourage local innovation and to balance the priorities of quality, cost and supply.

The report explored the payment systems used in the NHS and other health economies, and examines whether PbR is able to support such long-term objectives as disease prevention and the care of long-term conditions.

Payment by results incentivises hospitals to continue treatment, thereby blocking a shift to preventative and community-based care, the report said.

It concluded that different services require different payment systems: PbR is most appropriate to elective care, but less suited to other services.

In addition, the King’s Fund said, payment systems need to be flexible to assist adaptation at a local level and trade-offs between priorities.

The NHS needs a new reimbursement framework that allows different payment systems for different types of service, the report argued.

Monitor, the foundation trust regulator, commented that it could “recognise many of the areas for improvement identified in the report” and would give it “careful consideration” when developing its pricing strategy.

Health Minister Lord Howe said: “We are working to make sure a payment system supports care being delivered closer to patients’ homes.”

He added: “We are working to expand our best practice tariff programme which supports patient-focused care, encourages innovation and makes better use of resources.”

Johnson & Johnson has been fined $1.2bn by an Arkansas circuit court for fraudulent marketing of its antipsychotic drug Risperdal (risperidone).

The judge said the company and its US subsidiary Janssen Pharmaceuticals had lied about the drug’s benefits and risks in order to obtain Medicare reimbursement.

The fine is among the largest ever imposed in a US state fraud case involving a drug company.

J&J, which denies any improper conduct or actual harm, is calling for a retrial.

The judge, Tim Fox, fined the companies $1.19bn for nearly 240,000 violations of the state’s Medicaid fraud law and $11m for violations of its law on deceptive practices.

To date, 11 states have prosecuted J&J over its marketing of Risperdal, which is approved as a treatment for schizophrenia and bipolar disorder in adults and behaviour problems in young people.

Prosecutors have claimed that J&J inaccurately stated Risperdal to be more effective than generic alternatives, while concealing the increased risks of diabetes, stroke and weight gain associated with the drug.

Since reimbursement for Risperdal was available through the state-funded Medicaid system, J&J is accused of defrauding state authorities.

Arkansas attorney general Dustin McDaniel commented that the court’s verdict “sends a clear signal that big drug companies like Johnson & Johnson and Janssen Pharmaceuticals cannot lie to the FDA, patients and doctors in order to defraud Arkansas taxpayers”.

The fine was based on minimum penalties for each individual violation of state law through a prescription or marketing message – coming in this case to over 250,000 violations.

Janssen spokeswoman Teresa Mueller said the company would call for a retrial and, if that was denied, would appeal against the state verdict.

The court “did not show any Arkansas patient was ever harmed by using Risperdal” or “that any Arkansas physician or Arkansas Medicaid was ever misled by the drug’s label or package insert,” she asserted.

In the last year, J&J has reached a $158m settlement with Texas over the marketing of Risperdal and been fined $327m by South Carolina.

At the federal level, the company is in talks with the Justice Department to settle a misdemeanour criminal charge. However, the JoD has rejected a $1bn offer from J&J to settle all outstanding civil charges.

The Greek parliament has made prescribing of branded (as opposed to generic) drugs by state healthcare providers a criminal offence.

Further legislation rushed through under the EU bailout agreement will force drug suppliers to pay back any overspending on the reduced drugs budget.

Overall spending on medication by Greece’s social insurance funds has been capped at €2.88bn for this year.

From April 1, clinicians may only prescribe generic drugs in the 10 leading therapeutic classes; from June 1 this will apply to all reimbursed medications.

The Greek health service will reimburse only for the cheapest product in each class. Prescribing anything other than the cheapest generic product, except on a private basis, will now be a criminal offence.

Greek Health Minister Andreas Loverdos has said he aims to cut €1bn from the nation’s drug spending in 2012.

The new legislation was demanded by the economic ‘troika’ of the EU, the European Central Bank and the IMF in return for Greece’s €130bn bailout.

The troika and the Greek health authorities are also reported to be planning a ban on the introduction of new medicines into Greece until they have been accepted for reimbursement by 8–10 other EU countries.

The implications for Greek pharmaceutical companies, and for multinational companies investing in Greece, are serious. These companies are currently owed major sums by the Greek public hospitals, while the government bonds that have been used to pay some international debts are now worth very little.

The medical debt crisis is also spreading across Portugal, Italy and Spain, with unpaid debts by EU health systems to pharma companies now standing at €12–15bn. About half of this is currently owed by Spain’s regional governments.

Richard Bergstrom, Director General of EFPIA, commented: “Things are getting rapidly worse.”

Europe is falling behind the US and Japan as a market for innovative drugs, according to GSK Chief Executive Andrew Witty.

The Eurozone crisis means that EU countries are taking longer to approve new drugs, are paying less for them and are taking longer to pay.

While the EU markets are “slipping”, Witty said, the US remains more receptive to innovation and Japan is improving its uptake of new drugs.

The result is that even European pharma companies such as GSK and Bayer are looking to cut back their EU operations and invest in more rewarding markets.

In 2010, the US accounted for 61% of all sales of new drugs (launched in the previous five years), while Europe made up only 22%.

In Japan, 48% of GSK’s sales in 2011 were of new products – while regulatory changes are set to further accelerate the uptake of innovative drugs.

In Europe, reimbursement is increasingly a matter of contention between health authorities and pharma. Germany has introduced a 16% mandatory rebate on all prescriptions and a value-based pricing scheme that some companies have judged unacceptable. France and the UK are also seen as resistant to new drugs.

Industry concern is also growing over the potential impact of price cuts in Greece and Spain on reimbursement in other EU countries.

“Europe has unfortunately slipped in terms of its willingness to pay for innovation,” commented Andrew Witty. “We’re now at a point where we have to face the reality that really it’s about the US and, excitingly anew, it’s about Japan in terms of where innovation should be driven.”

Despite the global nature of the economic crisis, Witty argued, health policy in Europe was “stuck in a bad place” and falling behind other regions.

Witty’s views were echoed by Richard Bergstrom, Director General of EFPIA, who said: “Everybody in the industry thinks the same way. The euro crisis has triggered the worst in the national governments.

“People in governments don’t seem to realise the risks they are taking, both in the short term with supplies and longer term with innovation.”

The new UK life science strategy and NHS innovation review, launched by the Government this month, has been praised by the UK medical technologies sector for its promotion of innovative research and the rapid uptake of high-value technologies.

The NHS Chief Executive’s review Innovation, Health and Wealth: accelerating adoption and diffusion in the NHS outlines a number of measures the NHS will take to work in partnership with industry in order to implement effective new medical technologies throughout the NHS.

The document draws in attention, in particular, to the potential of telehealth systems to improve the management of long-term conditions, reducing hospital admissions and GP visits and so reducing the overall cost of care while improving patient outcomes, as demonstrated by the recent Whole Systems Demonstrator project.

Other areas of medical technology highlighted by the innovation document include the use of fluid monitoring in acute care and the use of assistive technologies, including wheelchairs, to improve the access of disabled people to working and other everyday environments.

Peter Ellingworth, Chief Executive of the Association of British Healthcare Industries (ABHI), the leading UK medtech trade association, said: “I welcome the Government’s focus on the life science industry. As highlighted by the Prime Minister our sector is part of ‘the virtuous circle of health, wealth and well-being’ – a real growth area for the Government as well as having the potential to make a difference to patients through the innovation we bring.

“Measures such as reform to the tariff system, enforcement of NICE guidance and the development of a procurement strategy, if done properly, could make a real difference to the medical technology sector.

“ABHI will work with the Government to make sure that the measures outlined in the Innovation Review are translated into firm actions. The measures could make a real difference to the SMEs in our sector and it is crucial that we are able to take advantage of them and continue to grow.”

Doris-Ann Williams MBE, Chief Executive of the British in Vitro Diagnostics Association (BIVDA) and a member of the Innovation Review’s External Advisory Group, commented that the Government’s announcements “represent a crucial opportunity for the life sciences sector” – and that the life science strategy and the innovation review in combination “will reinforce a genuine partnership between industry, the NHS and government.”

“To accelerate the use of innovative technologies to benefit patients and the NHS, tangible and realistic proposals were needed,” she added. “The NICE Implementation Collaborative, an innovation scorecard and a commitment to examine reimbursement mechanisms for diagnostics will all help the IVD industry to do what it needs to do to turn the vision into reality.”

Tony Davis, Chair of health technology business support organisation Medilink UK, noted that the new life science strategy “sets the stage for telehealth and telecare technologies to be made available to every person with a long-term condition or in need of care in the UK, helping them manage their health while maintaining their independence.”

“Medilink UK has been working with industry, other trade associations and the Department of Health to accelerate the roll-out of telehealth and telecare services in the NHS and social care, which will enhance the lives of three million people over the next five years,” he concluded.

The Government needs to do more to support life sciences in the UK and create an environment where the industry can flourish, a new survey has found.

RSA’s The UK Life Sciences Leaders’ Survey 2011 revealed worries over the NHS reforms, medicine pricing and reimbursement, employment issues and the cost of research amongst its leaders.

Nick Stephens, CEO of RSA, says the Government “urgently needs to do more to ensure that education, regulation, access to medicines and the NHS research base align to support the industry’s continued contribution to the UK economy”.

The report is the second annual survey of industry bosses. Last year the general feeling was of optimism with leaders believing the recently elected coalition Government would improve the business environment.

But twelve months later the mood has changed with results finding leaders claim the UK is not competing effectively globally, creating opportunities for early phase/smaller companies or making the most of its unique selling points: the NHS and skills in innovation and discovery.

Leaders also raised concerns about the increasing cost of working in the UK, the implication of R&D as a result of the NHS reforms, the regulatory burden on operations and the process from development to market. They also advised that fiscal and tax incentives should be given to SMEs to help their growth and the UK compete globally.

Worries were also raised about the introduction of value-based pricing. However, in contrast, health technology assessments were broadly welcomed as a means of enhancing value and meeting therapeutic requirements, the report found.

During the tough economic environment, the survey found that leaders would focus on innovation, creating flexible organisations and processes, and refocusing research and development to weather the current storm.

In a perfect world, leaders revealed they would investing in R&D and make the healthcare sector, regulatory and commercial environment work closer together to achieve better outcomes for patients and the pharmaceutical industry.

Stephen Whitehead, CEO, ABPI, says the survey shows more support is needed for biopharmaceutical companies in the ever-changing NHS. “There is much that the Government has done to support the industry, particularly through the Growth Review and the Office for Life Sciences,” he said. “But we need to build on this as part of a continuing relationship with NHS and Government to explore how unnecessary bureaucracy can be eliminated from the healthcare system so that new treatments can reach patients as quickly as possible.”