Several features of the repealed SiNATS are therefore maintained. However, the new regime also brings significant terminological and substantive changes, which will undoubtedly affect pharmaceutical companies.
The full extent of that impact will become clear only once the regulations implementing this new framework, which cover matters as diverse as margins, pricing, the formation of homogeneous groups, assessment procedures, clinical and economic assessment methodologies, and early access, have been approved.
Although much remains to be decided, the New SiNATS already provides important indications regarding the terms of public funding, assessment timelines, contracts, confidentiality, supply obligations, early access, and other matters. Some of these points are summarized below.
Pricing
The regime governing price approval and annual price revisions is maintained in all material respects. The main change concerns the public funding of generic and biosimilar medicines: once the applicable pricing rules have been satisfied, public funding will become automatic, enabling faster access.
Public Funding and Access
The previous SiNATS was based on a bifurcation between prior assessment and reimbursement. Prior assessment concerned the State’s full funding of medicines via the purchase by National Health Service hospitals. Reimbursement concerned State co-financing of citizens’ purchase of medicines through payment of a percentage of the retail price.
The reality, however, is that both serve similar purposes, seeking to ensure equitable access to medicines through the State’s exercise of regulatory and market power. That similarity brought their regimes closer together and sometimes made their respective boundaries difficult to define.
The New SiNATS aligns these regimes, combining them under the concept of “public funding and access,” which encompasses the requirements applicable to any public-funding decision and imposes corresponding obligations on marketing authorization holders. This is without prejudice to the preservation of specific rules for reimbursement and prior assessment of medicines.
The relationship with the National Health Service is therefore organized around actually making the medicines available to the patient, and the procedures are now subject to uniform deadlines determined by the type of medicine rather than by the form of funding or co-financing.
Timelines
Some deadlines for decisions on public funding and access have been extended. For innovative medicines, the maximum overall period is 300 days (180 + 60 + 30 + 30). As under the previous SiNATS, exceeding the deadline has no consequences.
Assessment
The New SiNATS retains a two-stage assessment process: first, clinical assessment and, if positive, economic assessment. The starting point for economic assessment is whether the medicine has demonstrated added clinical value. Where added clinical value exists, the assessment also includes a rating of the magnitude of that increase, measured in light of the clinical evidence submitted.
Economic Advantage
It is in this domain that we find some of the New SiNATS’s most detailed and innovative provisions. New concepts of therapeutic value are introduced, together with new ways of demonstrating economic advantage that apparently strengthen INFARMED’s powers, raise the standard for demonstrating therapeutic benefit, and intensify downward price pressure.The key points in this area are:
1. The introduction of the concepts of quantifiable and non-quantifiable added therapeutic value:
- Quantifiable added therapeutic value: a medicine that receives a positive clinical assessment and demonstrates quantifiable added therapeutic value. Economic advantage is demonstrated through a cost-effectiveness study conducted in accordance with the approved methodological guidelines or through a comparative cost analysis against the comparator. This is the option that affords the greatest discretion in setting the price. At least in theory, the marketing authorization holder may justify a price significantly higher than that of the comparator by demonstrating significant and measurable health gains.
- Non-quantifiable added therapeutic value: a medicine that receives a positive clinical assessment but whose added therapeutic value relative to the comparator cannot be quantified. Economic advantage must be demonstrated through a comparative cost analysis against the comparator, and the price may not exceed 5% of the comparator’s cost, depending on the budgetary impact.This is a new and highly restrictive rule: even where added value is recognized, the margin is limited to 5% when that value cannot be determined.
This is a new and highly restrictive rule: even where added value is recognized, the margin is limited to 5% when that value cannot be determined.
2. Fixed Combinations
For fixed combinations of single-component medicines funded separately, economic advantage must be demonstrated by cost savings of at least 30% compared with the price of the sum of the non-generic single components or, failing that, by a reduction of at least 10% compared with the price of the most expensive generics.
3. Combinations
Where the assessment of a medicine for a particular therapeutic indication requires the combined use of medicines held by different marketing authorization holders, INFARMED may review the public funding and access conditions for the medicines in the combination that are already funded.
Contracts
In the event of a favorable decision, entering into a contract is now generally mandatory (whereas previously it was mandatory only for hospital medicines). The contract must include the maximum acquisition price and other public funding and access conditions, such as a cap on the State’s maximum expenditure and the consequences of exceeding it (repayment to the NHS, price reduction), risk-sharing arrangements, etc. There are, however, some new features. Agreements must be reviewed every two years for innovative technologies, and renegotiation is mandatory if the population or expenditure increases by more than 60%; the renegotiation must result in a price reduction of at least 10%.
Modification and Exclusion from Public Funding
The New SiNATS standardizes the grounds for excluding or modifying public funding and access, establishing a single regime for reimbursement and prior assessment. Accordingly, public funding and access for a medicine may cease where, among other things, efficacy or effectiveness has not been demonstrated or established, the medicine has less clinical value than funded alternatives, or it is used outside the indications for which the benefit was recognized. The same circumstances may also lead to changes in the agreed public funding and access conditions.
A notable new rule in this area is that funded medicines subject to shortages or frequent supply difficulties are excluded from reimbursement, without prejudice to other sanctions.
An automatic price-erosion rule is also provided for: non-generic reimbursed medicines included in a homogeneous group with a generic share exceeding 20% and a price difference of more than 30% compared with the most expensive generic must reduce their price by 10% after 24 months.
Changes to Marketing Rules
The obligation to commence marketing within 90 days after notification of the public funding and access decision is established, failing which the funding will lapse. Public funding and access will also lapse if the marketing authorization holder interrupts commercialization for more than 180 days.
A new regime is also created for the voluntary suspension or discontinuation of commercialization: this must be notified at least six months in advance, together with an explanation and identification of the impact.
These rules, which are more stringent and detailed than those under the previous SiNATS, reflect the legislature’s concern with continuity of supply and have a direct impact on portfolio management and commercialization decisions by companies in Portugal.
Exceptional Access
The New SiNATS creates a regime for exceptional access that, in theory, replaces the previous early-access regime: i.e. making a medicine available before its authorization or, as applicable, before the public funding decision.
It establishes the possibility that, while a medicine’s marketing authorization procedure is pending, INFARMED may conduct simultaneously the clinical and economic assessment procedure associated with public funding.
It further provides that supply before the public funding decision is made free of charge. It also adds that the marketing authorization holder must ensure continuity of treatment for patients already undergoing treatment if the application for public funding is denied. The rule that during the public funding procedure, an individual authorization may be granted for a specific patient, is maintained.
Although the Early Access Program regime appears to have been eliminated, INFARMED has clarified that, until the new implementing regulations are approved, the regulations currently in force will continue to apply.
Autonomous Regions
The New SiNATS expressly extends the pricing regimes, assessment procedures and related decisions, and the rules and conditions governing public funding and access to the Regional Health Services of the Autonomous Regions of the Azores and Madeira.
Sanctions
The New SiNATS introduces a standalone administrative offenses regime. The administrative offenses provided for therein essentially correspond to those which already existed, although in a simpler and more streamlined format.
Notably, the range of administrative offenses is expanded to include violations of the supply obligation: marketing authorization holders must supply the market “in accordance with the needs and agreed conditions.” This obligation reiterates an obligation already set forth in the Medicines Act, which requires the “adequate and continuous supply” of the medicine, also subject to a fine. The New SiNATS neither repealed nor carved out the Medicines Act regime, and therefore reconciling the two administrative offenses regimes will not be straightforward for medicines subject to public funding and access.
Effective Date
The New SiNATS entered into force on July 1. Its regime applies only to applications submitted after that date, as well as to proceedings for the reassessment of medicines or the review of agreements entered into under the previous SiNATS. As an exception, the confidentiality regime introduced by the New SiNATS applies not only to pending applications but also to agreements currently in force.
