Germany’s coalition government aims to contain healthcare expenditure by reducing the period of free pricing

Following announcement today confirming that the German coalition deal has been finalised, details have emerged regarding the new government’s cost-containment plans for the pharmaceutical budget.

Currently, pharmaceutical companies have 12 months of free pricing, before the negotiated price (agreed with the GKV-SpV following the GBA assessment) is applied.

This period of free pricing allowed for an extensive benefit assessment and price negotiation procedure that was introduced in 2011 and which typically led to price discounts.

Following the announcement of the new coalition agreement, this period of free pricing will be shortened to 7 months for recently launched prescription drugs instead of taking effect immediately after negotiations, in an effort to keep healthcare expenses under control.

“The negotiated reimbursement price applies from the seventh month after market entry,” said the coalition document.