Significant new reimbursement legislation was passed in Italy and France during 2014, the effect of which is to relax the law on the off-label use and reimbursement of medicines on economic grounds.
The new measures are aimed at reducing drug prices and (in Italy’s case) discouraging anti-competitive agreements between pharmaceutical companies which seek to unlawfully keep drug prices high. While industry considers how to react to these developments, the introduction by national governments of off-label reimbursement rules on costs grounds is now also under scrutiny by the European Commission as part of the study it has commissioned into off-label use.
Background of enforcement action by Italy’s competition authority
On February 27th 2014, the Italian antitrust authority (‘AGCM’) ined Roche and Novartis (€90.5 and €92 million respectively) for engaging in an anti-competitive agreement in the market for ophthalmic drugs used to treat vascular eyesight conditions, specifically by creating an artificial product differentiation by suggesting that Roche’s Avastin might have a poorer safety proile than Novartis’ Lucentis, thereby influencing the prescription rates of these drugs. Following this case Italy enacted legislation permitting (under certain conditions) off-label use and reimbursement on cost grounds (see below).
Avastin, authorised for the treatment of cancer, is being used off-label in a modiied format for treating eyesight conditions such as age-related macular degeneration (‘AMD’). Lucentis, on the other hand, contains an active substance with a similar mechanism of action to Avastin but is authorised for treating AMD. Since there is a significant difference in price (in Italy: €900 for a Lucentis injection versus €81 for Avastin), the AGCM found that Roche and Novartis had set up a complex collusive strategy in order to avoid the commercial success of Lucentis being adversely affected by the ophthalmic application of Avastin.
The AGCM’s decision to fine was upheld by the Italian Administrative Court of Lazio (judgment no. 12168/2014 of December 8th 2014) but is likely to be subject to further appeal before the Council of State, the Italian administrative court of final instance. Meanwhile, the results of a reported investigation by the French competition authority are not yet known.
The 2014 legislation in Italy and France
On May 21st 2014 Law No. 79/2014 came into force in Italy, providing for the Italian National Healthcare System to permit and reimburse off-label use of an authorised drug if its cost is cheaper than the cost of other drugs which are specifically authorised for the particular condition. The off-label therapeutic use under the new law must nevertheless be supported by medical and scientific research evidence, obtained both nationally and internationally.
The off-label use must also satisfy criteria of affordability and suitability. Speciic authorisation by the Italian Medicines Agency (‘AIFA’) is also required.
In France, Article 10 of the Amended Social Security Financing law for 2014 no. 2014-892, dated August 8, 2014, modified article L.5121-12-1 of the French Public Health Code by deleting the previous reference to an obligation which restricted off-label prescribing to situations where it was necessary in order to prevent a grave clinical risk arising or for the avoidance of expense which would have a signiicant impact on social security expenditure. This effect of this amendment appears to be that, where there is an appropriate alternative which has a marketing authorisation for the same indication, off-label prescription of a medicine is permitted purely on economic grounds.
This 2014 legislation took effect by modifying French law no. 2011-2012, dated December 29, 2011, on measures strengthening the safety of medicinal and health products, which itself inserted specific provisions on off-label use by creating article L.5121-12-1 of the French Public Health Code. Under the 2011 provisions, in the absence of a suitable alternative, a medicine can be prescribed by a responsible person even if marketing authorisation (MA) has not been granted by the French medicines authority (‘ANSM’) for that speciic indication, provided that the following conditions are met:
- a temporary use recommendation issued by ANSM is in force; or
- the responsible person judges, in view of the scientiic evidence, that such a prescription is essential for patient improvement or stabilisation.
Where an appropriate, authorised alternative medicine existed, French law no. 2012-1404, dated December 17, 2012 had subsequently provided that a specialty medicine could be subject to a temporary use recommendation (in consequence of which an off-label prescription would be authorised) only if its use was for the purpose of preventing grave clinical risk arising or for the avoidance of expense which would have a significant impact on French social security expenditure. It is this provision which has been deleted by the 2014 legislation.
As in the case of Italy the European Federation of Pharmaceutical Industries and Associations (EFPIA) has strongly disapproved of these developments in France, pointing out that a law permitting off-label medication for purely economic reasons is incompatible with the EU’s pharmaceutical regulatory framework. Particularly relevant in this context is the fact that one of the objects of the EU pharmaceutical regulatory framework is to safeguard public health.