On 1 August 2022, a crucial amendment to Act No. 363/2011 Coll. on the scope and conditions of the reimbursement of medicinal products, medical devices and dietetic foods under public health insurance (the Reimbursement Act) came into force.
The key objective of the amendment was to facilitate the access of demonstrably effective, innovative medicinal products to the Slovak market and, ultimately, to eliminate disparities in patients' access to treatment with innovative medicines. The changes will affect almost all areas regulated by the Reimbursement Act. This is so far the most significant change in the system of market access since 2012, when the Reimbursement Act became effective.
The Amendment addresses a number of systemic shortcomings and also introduces important changes relevant for pharmaceutical companies that manufacture or distribute innovative reimbursable or so-called 'exceptional medicines'.
The most significant changes are as follows:
Full introduction of innovative medicines to Slovak market
By default, medicinal products are reimbursed from public health insurance funds by all health insurance companies where the medicine is included in the list of reimbursable medicines. However, as for innovative medicinal products, these have been reimbursed until now in the so-called exceptional regime, where the health insurer individually assessed each patient's request for an innovative medicinal product and then decided to reimburse the innovative product for the particular patient. This review process, however, did not have clear rules. Insurers' decisions varied and patients were often not approved for reimbursement of an innovative medicine. Slovakia was, in effect, running two parallel systems of market access. One via official administrative procedure through which medicinal products were entered on the list of reimbursable medicines and second, via individual requests filed with the health insurers who decided on reimbursement based on their own criteria and budgets.
This undesirable phenomenon is now addressed by the latest amendment to the Reimbursement Act.
First, the amendment made a great legislative overhaul of the system of Managed Entry Agreements (MEAs). The new legislation expands on the possibilities when MEAs can be concluded, streamlines the process of concluding these agreements and modifies the mechanism for calculating the cost-effectiveness of medicines. As a result, it strongly supports the shift in market entry of the innovative medicines from the exceptional regime to the ordinary reimbursement regime.
Second, the amendment increases the transparency of the decision-making process of health insurers on the reimbursement of medicinal products that have not been entered on the reimbursement list. And while the exceptional regime is to stay, the new Reimbursement Act sets out procedures that health insurers will have to follow when dealing with requests for reimbursement of exceptional medicinal products.
Managed Entry Agreements (MEAs)
Under the previous regime, if the market authorisation holder wished for a particular medicinal product to be reimbursed by public health insurance, it had to enter into MEAs with all health insurers. This regime was cumbersome and prevented the entry of some innovative products. From now on, MEAs will no longer be entered into with each and all health insurers, but directly with the Slovak Ministry of Healthcare (the Ministry). This shifts responsibility for deciding what therapeutic options are available in Slovakia directly to the State.
Terms of the MEAs, such as the maximum amount of reimbursement for a medicine by a health insurer, the maximum amount of reimbursement by all health insurers, indication or prescription limitations, will be negotiated directly with the Ministry. Beyond this umbrella agreement, however, marketing authorisation holders still retain the option to agree on specific, more favourable terms with individual health insurers. The old MEAs should be replaced by new ones by 23 February 2023. Entering into the new MEAs will cause the old MEAs to lose their validity and effectiveness.
Better chances for increased patent protection thanks to discretionary reimbursement review
The amount of reimbursement of a medicinal product from health insurance is defined by reference to the cheapest generic medicine in a given pharmacotherapeutic group. All medicines included in the same pharmacotherapeutic group are equally reimbursed by the insurer only up to the price of this reference generic medicine. For the duration of a patent protection, innovative medicinal products remain alone in a given pharmacotherapeutic group and enjoy full reimbursement. Nevertheless, entry of a cheaper generic product causes reimbursement of the original product to drop to price of the generic product. Therefore, the inclusion of a generic medicine in a group with an original innovative product increases a patient's co-payment for the original medicinal product.
The long-standing practice of some generic or biosimilar manufacturers was that they used to literally lurk for the patent protection of a certain original medicinal product to expire and just before it did, they applied for reimbursement of their own generic product. The original manufacturers then had no choice but to respond by applying for an injunction requesting the court to order generic manufacturers to refrain from marketing the given generic.
Slovak courts consistently rule that such a practice by generic or biosimilar manufacturers infringes the patent rights of the original manufacturer. However, the long-standing practice of the Ministry was to disregard the existence of the injunction in reimbursement proceedings as the Reimbursement Act did not allow patent rights to be taken into consideration when deciding on entry of a generic to the reimbursement list. The Ministry would therefore proceed with allowing the generic to enter the reimbursement list, despite the generic manufacturer being prohibited by injunction from bringing the medicinal product to Slovak customers. The result was that the patient's co-payment for the original medicine rose rapidly while there was no cheaper substitute available on the market. In effect, patients had no access to medicines and the manufacturers of the original medicinal products were losing profit despite valid patent rights.
Amendment of the Reimbursement Act to some extent addresses this issue by means of discretionary reimbursements review. This is essentially a protection against a reduction of reimbursement of an original medicinal product due to the entry of a generic or biosimilar medicinal product in a situation where these are not actually available on the market. Should the medicinal product be unavailable to the patient, the Ministry will cancel the decision on the change of reimbursement by the health insurers. Patients will thus retain access to the medicine and the manufacturers of the original medicine will not lose profit.
Although a development from the original practice of the Ministry, a number of issues still remain unresolved. The Ministry will still allow generic medicinal products to enter the reimbursement list, thus decreasing the overall reimbursement for the original products. The marketing authorisation holders will need to remain vigilant and apply for preliminary injunctions. It is also unclear what the real life practice of the Ministry will be and whether issuance of a court-ordered injunction will suffice as proof that generic medicinal products are not available on the market. The new Reimbursement Act is certainly a step in the right direction, but there is still some way to go for innovative medicinal products to be truly protected.
Final remarks
These areas represent only a selection of the most interesting changes to the Reimbursement Act. It is a comprehensive amendment that aims to help both ordinary patients in their access to treatment, especially to innovative medicinal products, but also, in many aspects, market authorisation holders. Although Slovakia still has a long way to go before the introduced innovations are successfully implemented in practice, one can already say with certainty that the amended Reimbursement Act brings the legal regulation of market access closer to the European standard.
