Emerging voluntary cooperation between European healthcare systems: Are we facing a new future?

Abstract

Voluntary cooperation between European healthcare systems in medicines can bring concrete benefits for those healthcare systems and for patients. Although cooperation between countries in the form of clusters has been in place for some years now, there is still relatively little information on their objectives, scope, structures, procedures and activities – partly due to confidentiality, partly due to an ever-changing environment. By interviewing people who are directly leading the voluntary cooperation in countries, this article brings more clarity on the current state of play in voluntary cooperation and unpacks the challenges that countries and companies are facing in moving the joint process forward. In particular, we have anticipated the potential short- and long-term outcomes and consequences for medicine assessment in participating countries.

Where are we coming from?

Under Article 168 of the Treaty on the Functioning of the European Union (EU), ¹ public health is a competence shared between the EU and EU countries. While EU countries define and deliver their national health services and medical care, the EU seeks to complement national policies by means of its Health Strategy. EU health policy originated from health and safety provisions, and later developed on the basis of the free movement of people and goods in the internal market. In harmonising measures to create the internal market, a high level of protection formed the basis for proposals in the field of health and safety, including pharmaceutical products. ² As a result of the contradictions between the EU’s competence in preserving the Single Market on the one hand, and member states’ willingness to shape and retain control over their own healthcare systems on the other, healthcare legislation and policies have always been a controversial topic within the EU.

As a part of the discussions on the future of Europe, the European Commission presented a ‘White Paper on the Future of Europe’, ³ outlining different scenarios for future EU cooperation and five reflection papers on key issues: the social dimension, harnessing globalisation, the deepening of the economic and monetary union, the future of European defence and the future of EU finances. The Commission wanted to initiate a comprehensive debate on the future of Europe with civil society and other social actors, to promote participation in the shaping of EU policies. The publication of the white paper could be seen to undermine EU-level action in healthcare. It was the tip of the iceberg in a discussion on the future of healthcare in the EU, as it put forward the prospect of reducing the EU’s engagement in this area. ¹ A domino effect followed: we have witnessed a debate on the EU budget ⁴ and potential cuts in funding for healthcare projects, rumours of the restructuring or even dismantling of the Commission’s Directorate General for Health and Food Safety (DG SANTE’s), ⁵ and attempts by the European Commission to continue and strengthen collaboration on health technology assessment (HTA). ⁶

Over the past few years, the EU’s role in healthcare policy has been evolving. The concerns of EU stakeholders and member states have moved through a series of phases, each bringing its own challenges. In the late 1990s, countries were concerned about the lack of innovation in the healthcare sector and developed more incentives for the private sector to invest in research through, for example, the adoption of the EU Regulation on Orphan Medicinal Products (OMPs) in 2000 ⁷ and the Regulation on Supplementary Protection Certificates (SPC) in 2008. ⁸ When more innovative treatments started to come through, patients had to fight for access and overcome affordability challenges. Today, we see the debate shifting to focus on the long-term sustainability of healthcare systems and, in most cases, the price of medicines. The process of medicine development and market authorisation is long. It goes through basic research, discovery of the medicine, preclinical development tests, increasingly complicated clinical trials with humans and regulatory approval by respective authorisation bodies. For a small-molecule medicine, the path to market takes on average 10–15 years and hundreds of millions of US dollars.

Countries are facing the consequences of the significant increase in healthcare innovation that they were hoping for but have not necessarily fully anticipated and therefore prepared for. The launch of Sovaldi in 2014, a medicine offering a potential cure in a short term, was a breakthrough for the treatment of hepatitis C. It was also a catalyst for member states to assess how they spend their healthcare budgets as the new treatment required a high upfront cost, which single-year budgets did not allow for. Sovaldi is just one example of where governments were not able to counter the associated cost of an innovative medicine. ⁹ They are struggling to maintain the sustainability of their healthcare systems because of an ageing population, increasing burden of chronic illnesses, health inequalities, productivity and efficiency challenges of health systems, as well as the prices of medicines and technology.

Confronted with common challenges, countries have developed a potential solution that has grown from a real desire to join their forces: they have developed a series of voluntary cooperations between healthcare systems on medicines. ¹⁰

As Maggie De Block, Belgian Health Minister, said in May 2018: ‘International collaboration is an essential lever to be able to offer our patients affected by a rare disease the best possible care in the context of budgetary constraints that are more than ever on the agenda’ (on the occasion of the European Policy Centre’s event ‘Fostering member state cooperation on drug pricing and policies – Lessons from the BeNeLuxA initiative’ that took place on 3rd of May 2018 in Brussels.). Although Maggie de Block refers specifically to rare diseases, as we will see, the scope of some of the voluntary collaborations is broader and covers innovative treatments in general.

The EU healthcare agenda is becoming increasingly contradictory, with member states wanting to keep their healthcare systems independent on the one hand and at the same time seeing the potential – and arguably ultimate – need to collaborate. Importantly, this development is happening and being driven forward by individuals and countries themselves, rather than from top-down mechanisms through the EU framework.

In June 2018, the first positive outcome of joint pricing and reimbursement negotiations between Belgium and the Netherlands sent an important signal that voluntary cooperation can bring concrete benefits for healthcare systems and patients, as well as additional motivation to further develop this supranational cooperation. ¹¹

Methodology

In light of this changing environment of healthcare policies in the EU, this article aims to provide an explanation of what is taking place and the potential impact that voluntary collaboration between countries could have on patient access, industry and the sustainability of healthcare systems.

The first part of the article will focus on the definition of voluntary collaboration, the objectives of these collaborations and their scope. The second section will set out the current state of play within the various collaboration clusters. To support this, several interviews were conducted with key opinion leaders involved in voluntary cooperation at national level, to have a better understanding of how cooperation is evolving, what the critical success factors are from a country perspective and if there is a place for the EU in that space. The interviewees were selected based on the level of collaboration development and their focus (e.g. both BeNeLuxA and FINOSE are quite advanced compared to other collaborations, and both have a different scope – see explanations below). The views of interviewees are their own and do not represent a formal position of the organisations that they represent. No grants or funding has been received for this article.

In the final part of the article, we will present the challenges and opportunities linked to voluntary collaboration between healthcare systems for pharmaceutical companies and what they should expect as they are directly impacted by new rules and regulations coming into effect (see Appendix 1).

What is voluntary cooperation between healthcare systems?

Some call it ‘cross-border’, others prefer to use the word ‘regional’, ‘joint’ or ‘multi-country’ cooperation. In our article, we have decided to use the term ‘voluntary cooperation between healthcare systems’ (voluntary cooperation), a term used in the Council Conclusions adopted during the Maltese Presidency of the European Council. ¹² We believe that it best reflects the nature of this phenomenon, stressing the non-mandatory scope, rather than focusing on geographical and/or numerical aspects, which in most cases are not fully accurate and likely to be short term.

Cross-border, voluntary collaboration is defined as a voluntary and organised cross-border activity between healthcare sector actors (often governments and health agencies, providers, professional bodies, funders, educational institutions and others) that is designed to improve patient access to highly specialised, high-quality diagnosis and care in their own country. ¹³ From the perspective of recent developments at the EU level, voluntary cooperation refers to different initiatives undertaken by European countries (including EU member states and third countries) in recent years, with a specific focus on medicines policies and regulations. Since 2014, voluntary cooperation between healthcare systems has been high on the political agenda of EU presidencies. The European Council became an ideal forum to explore collaboration opportunities, as demonstrated by consecutive council conclusions.

The Council Conclusions on ‘Innovation for the benefit of patients’ were adopted in 2014 under the Italian Presidency. ¹⁴ These conclusions invited member states to explore opportunities for cooperation on the exchange of information between competent bodies. This position was reinforced under the 2016 Dutch Presidency, with the adoption of ground-breaking Council Conclusions on ‘Strengthening the balance in the pharmaceutical systems in the EU and its Member States’, ¹⁵ where ‘voluntary cooperation’ is mentioned eight times. The Dutch Presidency attempted to formulate principles for the cooperation, ensuring its voluntary aspect, focus on clear added value, and shared interests and objectives of participating countries. EU member states were encouraged by their peers to explore the opportunities that voluntary cooperation on medicines can bring to their healthcare systems. The Maltese Presidency in 2017 adopted Council Conclusions on ‘Encouraging member states-driven voluntary cooperation between health systems’, explicitly focusing on this topic. ¹² Paradoxically, one of the main EU institutions has become a driver for the emergence of voluntary cooperation, which the participating countries clearly want to be independent from the EU structure.

Some of the country clusters have been built on the pre-existing collaborative fora of participating countries, for example, the Visegrad Group which focuses on many different topics and policies. The Visegrad Group was formed on 15 February 1991 at a high-level meeting of the Presidents of Czechoslovakia, Poland and Hungary, in Visegrad, Hungary. The collaboration was initially established to eliminate the remnants of the communist bloc in Central Europe, overcome historic animosities between Central European countries, achieve the set goals and to successfully accomplish social transformation and join in the European integration process. Currently, the collaboration is ongoing in numerous areas including culture, environment, internal security, defence, science, education, justice, transportation, tourism, energy and information technologies. For more information: http://www.visegradgroup.eu/about/aims-and-structure.

Other country clusters have emerged specifically to tackle the issue of the sustainability of healthcare systems and therefore are relatively new, having to build their structures from scratch. An example of this is the Valletta Declaration. The Valletta Declaration is an alliance of southern EU member states, which aims to explore strategies to jointly negotiate prices with the pharma industry. Its name comes from a declaration that was signed on the 4 of May 2017 in Valletta, Malta. As of September 2018, it consisted of 10 member states: Italy, Greece, Romania, Malta, Cyprus, Ireland, Spain, Portugal, Slovenia and Croatia. The official text of the Valletta Declaration: http://ufmsecretariat.org/wp-content/uploads/2017/10/Declaration_EuroMed-Cooperation-in-Research-and-Innovation.pdf.

A third group comprises countries that used to work together in the healthcare sector but have not had any formal collaborative structure as such in place, with the new trend of voluntary cooperation between healthcare systems representing a perfect opportunity for them to formalise their work, e.g. BeNeLuxA. The BeNeLuxA initiative was formed during the informal meeting of European Ministers for Employment, Social Policy, Health and Consumer Affairs in Riga, Latvia, in April 2015, where the health ministers of Belgium and the Netherlands announced their initiative to explore possible collaboration on pharmaceutical policy. After that, the following countries joined the initiative: Luxembourg (2015), Austria (2016) and Ireland (2018). For more information: http://www.beneluxa.org/.

Voluntary cooperation country clusters vary in membership, sometimes overlapping and being disconnected from geographical and cultural links. There is currently a high level of movement within and between different clusters, which makes it even more difficult to categorise them. Taking an example, Norway and Denmark signed an agreement on joint pricing and reimbursement negotiations for some medicines in September 2018, ¹⁶ with Norway being already part of the FINOSE collaboration. ¹⁷ Ireland joined the BeNeLuxA initiative in June 2018, having already signed the Valletta Declaration. As stated by Francis Arickx, Head of Directorate for Pharmaceutical Policy at the National Institute for Health and Disability Insurance in Belgium, in an interview with Hanover, in his opinion the voluntary cooperation landscape might only settle down in the longer term. What is more important, as Niklas Hedberg, Chair of the EUnetHTA Executive Board and Chief Pharmacist at the Dental and Pharmaceuticals Benefits Agency (TLV) in Sweden, suggests, is that the scope of each country cluster is what should classify them.

According to both Mr Arickx and Mr Hedberg, voluntary cooperation country clusters can be divided into three different types, depending on their position in the value chain:

1. HTA assessment – as a first step, which in most EU countries consists of HTA bodies systematically reviewing individual dossiers on the detailed evidence relating to the safety and efficacy of the new medicine as well as its ‘added clinical benefit’. In other words, a comparison of the clinical effectiveness of the new product with the existing standard of care (e.g. currently FINOSE collaboration – FINOSE is a collaboration between three Nordic HTA agencies – Sweden’s Dental and Pharmaceutical Benefits Agency, the Norwegian Medicines Agency and the Finnish Medicines Agency that was formed on 27 March 2018. The overall intention of the collaboration is to ensure earlier access to drugs through cooperation on assessment of relative efficacy and relevant parts of the health economic framework. For more information: https://www.tlv.se/in-english/international-collaboration/finose—a-nordic-cooperation.html);

2. Appraisal – as a second step, where the bodies issue recommendations as to whether to reimburse the medicine or not based on the outcome of the HTA assessment as well as additional input, such as local health policies, values and patient testimony;

3. Decision-making – as a last step, which can consist of joint pricing and reimbursement negotiations or joint procurement agreements (e.g. BeNeLuxA).

This division is similar to the World Health Organization’s (WHO) classification of regional collaboration for procurement experiences in health technology, which is based on increasing degrees of cooperation:

1. Informed procurement: countries share information about prices and suppliers;

2. Coordinated informed procurement: countries may also undertake joint market research, share supplier performance information and monitor prices;

3. Group contracting involves jointly negotiating prices and selecting suppliers;

4. Central contracting and purchasing: participating countries jointly conduct tenders and award contracts through a central purchaser working on their joint behalf. ¹⁰

Some of the country clusters might have a broader scope and focus, such as the BeNeLuxA cooperation, which extends from horizon scanning, information sharing and policy exchange to joint HTA and joint pricing and reimbursement. ¹⁸ Maggie de Block has stated that it is not possible for countries to participate in the joint pricing and reimbursement negotiations (the third step), if they did not participate in information sharing and joint HTA in the first place (EPC event on BeNeLuxA, 2 May 2018).

Where we are now?

Despite their emergence in recent years, there is still relatively little information on the objectives, scope, structures, procedures and activities of the voluntary cooperation. This is partly due to the fact that most of the work of the country clusters is confidential (e.g. closed-door meetings of technical committees, pilot projects on pricing and reimbursement) and partly because, for a majority of the country clusters, their overall direction remains unclear. As confirmed by the Greek Minister of Health, Andreas Xanthos, after the meeting of the Valletta Declaration’s technical committee in May 2018, ‘the cooperation between members of the group was limited to regular technical or political meetings. Instead, there should be continuous communication and use of scientific information, research data and expertise’. ¹⁹ In our view, BeNeLuxA seems to be an exception as the governments are running a dedicated public website ²⁰ which includes the Terms of Reference, major updates on processes and procedures.

We are also of the opinion that the lack of information could create a level of misunderstanding and misinterpretation around the voluntary country clusters. This could contribute to scepticism about the drivers and the potential outcomes of joint activities, especially from a company perspective.

Where duplications exist are there any attempts to solve them?

Voluntary cooperation, when considered alongside national and European procedures (such as EUnetHTA), might be perceived by some stakeholders (e.g. companies) as a mechanism that does not bring any added benefit. Instead, it could increase the administrative burden for companies by duplicating work and ultimately slowing down patient access to medicines.

Niklas Hedberg is of the opinion that there should not be any overlap between different country clusters, as long as each country cluster follows the scope that it has set out (see the categorisation above). Francis Arickx agrees. He is confident that duplications between clusters will not take place as there will probably be further merging between them for certain aspects of collaboration. In his opinion, there is a significant possibility that different clusters will work together, instead of separately, for instance, on horizon scanning or exchange of information – informing each other on knowledge and expertise.

In the context of the European Commission’s 2018 legislative proposal on strengthening EU cooperation on Health Technology Assessment, Mr Hedberg is very clear that, with closer HTA cooperation at EU level, the existence of voluntary cooperation would not create any duplication. Country clusters would still play an important additional role, for example, by focusing on a particular patient group or using a different but still valuable and necessary comparator. This opinion is shared by Francis Arickx, who has said that should a European-wide HTA institute be established, it would not be able to cope with all the assessment demands from all EU countries. It is our view that as some work would still have to be done at national level, voluntary cooperation could contribute. Due to capacity restrictions, a lack of human resources and/or a lack of expertise, there is scope for cooperation and national assessments to continue to exist side by side (On 31 January 2018, the European Commission adopted a legislative proposal for an EU regulation on Health Technology Assessment. The aim of the proposed regulation is to boost stronger cooperation among EU Member States for assessing health technology. The regulation provides the basis for permanent and sustainable cooperation at the EU level for joint clinical assessments in new medicines and certain new medical devices).

Another challenge is that of potential duplications and overlaps in the context of joint pricing and reimbursement negotiations. Some stakeholders believe that this was the case within the BeNeLuxA cooperation, where a joint negotiation was subsequently implemented individually through national-level procedures. ²¹ Repetition could arise from the difference in national legislations. If voluntary collaboration proves to add value in the long term, we could see national legislation becoming more aligned. Depending on the countries, these changes could be cosmetic and purely administrative, or they could be more extensive. The main argument remains – there is still a need to prove the added value of voluntary cooperation.

Where are the big countries and is there a place for them?

With the exception of Italy and Spain, other large EU member states do not seem to share the enthusiasm around enhanced cooperation between healthcare systems. Italy is participating in the Valletta Declaration and Spain, in addition to its engagement in Valletta, is running a separate cooperation with Portugal, ²² exploring opportunities for joint negotiations and the joint centralised purchase of medicines.

Officially, France, Germany and the United Kingdom are not seeking to join any voluntary cooperation initiatives. However, France’s representatives joined the third Ministerial Meeting of the Valletta Group hosted by Spain on 31 January 2018. ²³ Officially being neither member nor observer, France apparently sees potential benefits for its healthcare system and patients and wants to be included in the discussion.

According to Arickx, a larger country might join a country cluster or participate in certain aspects of their cooperation in the future – depending on the scope and focus. For example, on the joint HTA projects, there has been a strong interest from France to take part as they have been particularly keen on benefitting from a larger team of experts. According to the payers we have spoken to, in the future, the BeNeLuxA cooperation will have to expand invitations to other countries, including larger EU member states, to participate in some form of group purchasing or contract. For some rare diseases, a multi-country approach would be the best solution and, in this case, we believe a broader negotiation would make sense.

As for Germany’s interest in voluntary cooperation, Niklas Hedberg believes that an important reason for smaller countries to join a country cluster is to increase their purchasing power, that need is not as important for a big country as Germany and, hence, is not an argument for them to join any country clusters. Taking the example of the Valletta Declaration, participating countries strongly focus on increasing their bargaining power, even if together they still represent a small market compared to the EU5.

Is this really all about power and the price of medicines?

Voluntary cooperation is seen by some in the industry, above all, as a way for countries to increase their purchasing power and lower the price of medicines. These are indeed the messages that are being delivered by the high-level politicians involved in the voluntary cooperation. The Visegrad Group signed a Memorandum with the explicit objective of ensuring ‘fair and affordable medicines’. ²⁴ When joining BeNeLuxA in June 2018, Irish Minister of Health, Simon Harris, stated that ‘[…] this collaboration will assist us in doing just that by ensuring that medicines can be sourced at a price that is affordable and sustainable in the context of the ever-competing demands for resources rights across our health service’. Cypriot Minister of Health, Constantinos Ioannou, at the inaugural meeting of the Valletta Technical Committee, in Lefkosia, stressed that

[…] all of our member states can jointly present the pharmaceutical industry with a market that has significantly enhanced negotiating power, a very attractive market of 154 million and not individual markets of half a million, or ten or 20 million. A joint market with the invaluable involvement of two large markets, Italy and Spain, participate in this initiative giving this collaboration even more momentum. ²⁵

On the question of increasing the bargaining power of these countries, Francis Arickx has highlighted several times that the first objective of BeNeLuxA’s collaboration remains securing patient access, rather than lowering prices. For the Visegrad Group, ²⁶ the most important element is increased power in negotiations with companies. Similarly, the Greek Minister of Health (a signatory of the Valletta Declaration) has stated that the growth of the group ‘strengthens the negotiating power of individual countries over strong business interests of the pharmaceutical industry’. ²⁷

Discrepancies in the objectives of these collaborations exist at different levels – ministerial, administrative, European, regional, private and public. So, what does it all mean for industry and can their objectives be aligned?

Challenges and opportunities for pharma companies – a new modus operandi

For some regulators, voluntary cooperation between healthcare systems is frequently seen as the future. They are strongly motivated and ambitious to move forward by creating stronger ties between national medicines agencies, strengthening joint procedures and aligning national regulations. Looking back just two years, we can see that the environment has been settling down and countries are increasingly concrete in their objectives, as well as their demands towards companies.

The positive outcome of joint reimbursement negotiations on Spinraza between Belgium and the Netherlands, within the BeNeLuxA initiative, confirms that the partners are eager to continue their efforts as the new system has been proven to work. Following the joint negotiations, Spinraza, an orphan medicine for spinal muscular atrophy treatment, has been reimbursed in both countries under similar conditions. The process consisted of a joint HTA, followed by a joint price negotiation. The confidential agreement that Belgium and the Netherlands have concluded with the company provides for a temporary refund of Spinraza until the end of December 2020. ²⁸ Despite the fact that only two out of five BeNeLuxA partners participated in this project, Bruno Bruins, the Dutch Health Minister, complimented Spinraza’s manufacturer on its readiness to engage in a collaborative process, expressing hope that more companies will follow this example. ²⁹

Despite this significant step, it seems that companies are not optimistic about voluntary collaboration between countries. Some business leaders are not taking the ongoing activities of the country clusters seriously and are reluctant about the idea of participating in joint pilot projects.

Both governments and companies do apparently see the benefits of voluntary collaboration in some areas, for example, to reduce the administrative burden in the early stages of a medicine’s authorisation process. Likewise, both governments and companies need to invest a significant amount of time, effort and resources to elaborate all the necessary files. It is not always clear for governments where the challenges might be for the companies in the context of these collaborations. For example, some of the companies we have spoken to see the voluntary collaboration as an attempt to undermine the value of their drugs and ultimately to decrease the final price. Despite the efforts of countries to clearly divide the voluntary clusters into different types (see above: HTA, appraisal, pricing and reimbursement/procurement), for companies it is all interlinked: the collaborations analyse and assess the commercial value of a medicine. Some companies may think that governments are not sensitive enough to the global nature of business and focus purely on their market without taking into account potential knock-on effects in other regions (e.g. as a result of international reference pricing).

In our view, it would be ideal to find a balance between the expectations of national authorities, governments and companies. As confirmed by an industry representative, companies would potentially agree to an average price of their drug for certain country clusters but only if it really speeds up the processes in all participating countries, without delays in one or another. The representative told us that once agreements are made between countries, they must be respected to retain credibility and the trust of the industry. In our opinion, the creation of multi-country ‘innovation hubs’ (e.g. among Nordic countries) could be appealing to business leaders. If innovation is valued and decision-making is faster, treatments could be launched simultaneously, rather than having fragmentary, nationally-focused product launch strategies that are very time and resource consuming. Still, some companies fear that such a process would turn into a ‘one shot’ opportunity, which carries significant risk.

Ultimately, in our view, this should all be about timely access to medicines for patients: the medicines that are essential in managing severe and life-threatening diseases and those that can dramatically improve a patient’s quality of life. While we discuss the arguments of governments and companies, patients should also have a voice in this debate. The needs of patients may differ from country to country and their opinion should be taken into consideration in any voluntary supranational activities. Unfortunately, it is not always the case and there is a risk that the real needs of the patients are lost within the discussions.

Conclusion

At the moment, there is not enough experience to assess the future and impact of voluntary cooperation. Still, voluntary cooperation could only be accomplished if all parties involved hear each other and understand the respective needs. Companies are unlikely to enter into the joint processes without the certainty of what will happen to their product in the coming years – how it will be assessed, by whom, based on which data. Governments could only move voluntary cooperation forward if companies give up, to some extent, the confidentiality of their prices, as the current model of international reference pricing is not convenient for both. Patients also need to have a place at the table once the joint projects are underway.

The relationship between stakeholders strongly depends on individuals. It is important to ensure that a permanent point of contact to maintain dialogue is in place, regardless of personnel changes. Individuals representing authorities, governments, companies and patients must build their relationships on trust. As for companies, they should prepare and adapt to the evolving external environment. Governments ultimately have the competence to set up the rules on medicine authorisation and it looks like they are determined to change the current system. Voluntary cooperation is very likely to become the new modus operandi and companies need to make internal changes to respond to it. Many companies are currently not set up to work more collaboratively across markets. If voluntary cooperation is the countries’ way of maintaining control over medicine prices, companies will need to work harder to prove the value of their medicines and engage much earlier, providing innovative solutions that align with the governments’ will to collaborate at supranational level.