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[e-drug] USTR pressure on German system of reference pricing

E-DRUG: USTR pressure on German system of reference pricing


In USTR's 2007 National Trade Estimate Report on Foreign Trade Barriers 
contains a reference to a dispute between the US and Germany over 
reference pricing of pharmaceuticals (I've cut and pasted the paragraph 
below). Does anybody on this list know where I can find more information 
on this dispute? Including the legislation mentioned in the report? Any 
pointers I could get will be appreciated. Thanks.



As part of a broader health-care reform package, Germany introduced a 
reference pricing scheme on generic and patented pharmaceuticals on 
January 1, 2005. U.S. firms contend that they bear the brunt of 
cost-containment by virtue of their dominance (25 percent) of the German 
market. U.S. pharmaceutical companies note serious concerns about lack 
of transparency and fairness in the decisionmaking process related to 
the new reference pricing scheme, which does not provide a fair rate of 
return for patented, innovative medicines. Additional cost constraint 
measures were imposed through the combining of patented, innovative 
products with generic products, known as "jumbo groups." Both reference 
pricing and its variant, jumbo groups, are strongly opposed by U.S. 
pharmaceutical companies. The U.S. Government has raised this issue 
repeatedly with the German government, including during the visits of 
interagency U.S. health policy delegations to Berlin in June 2005 and 
February 2006. Legislation that went into effect in May 2006 clarified 
how drugs are declared innovative and provided more transparency in the 
decision-making process, addressing some industry concerns. The German 
government has continued to debate new, broader healthcare reform 
legislation, but the packages put forward to date have not contained 
further measures that would alleviate the disadvantages to U.S. and 
other countries’ producers of innovative pharmaceuticals.


Mike Palmedo
Research Coordinator
Program on Information Justice and Intellectual Property
American University, Washington College of Law
4910 Massachutsetts Ave., NW Washington, DC 20016
T - 202-274-4442 | F 202-274-0659

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