Snapshot: medicine and medical device pricing in Turkey

Pricing and reimbursement

To what extent is the market price of a medicinal product or medical device governed by law or regulation?

The principles for determining pharmaceutical prices were set by the Council of Ministers in the Pricing Decree and in the Pricing Communiqué published by the Ministry of Health (MoH) based on the Pricing Decree. However, as a result of the referendum held on 16 April 2017, an amendment has been made to the Constitution and a transition has been made to the Presidential Government System. The most fundamental feature of this system is the transfer of all executive authorities to the President with the annulment of the office of Prime Ministry. The President has become both the head of state and the head of executive power. Consequently, the rules and procedures for the determination of pharmaceutical prices are determined by the President, not by the Cabinet of Ministers.

The MoH is still applying the reference price system. The maximum sale prices of pharmaceutical products are determined by taking into account the lowest price of the product available on the market respectively in the reference countries (France, Greece, Italy, Portugal and Spain) and the countries of batch release and import. Where this is not available, the lowest price of the product available in EU countries – or, failing that, the ex-factory price (the sale price to wholesalers) of the product available on the market in any country across the world. The reference price takes the active substance into consideration for each product. Then it determines the price of different forms and dosages of this active substance by using a proportioning method.

The price of an original pharmaceutical is revised and becomes at most 60 per cent of the reference price upon the launch on the market of its first generic.

One of the most discussed topics relating to pharmaceutical pricing in Turkey is the euro and Turkish lira currency rate (Fx rate) determined by the Price Assessment Commission competent for calculating the price of a product. According to the Pricing Decree, the Fx rate should be adapted to currency fluctuations. However, the Fx rate set to 1.95 Turkish lira in 2007 was not amended until 2009. Upon litigation filed by the industry, the Pricing Assessment Commission slightly increased the Fx rate.

The Pricing Decree was amended in July 2015 and the Fx rate was accepted as 70 per cent of the average annual euro value. Accordingly, the Price Evaluation Commission would gather within the first 45 days of every year and announce the €1 value based on a calculation of 70 per cent of the average value of the previous year.

However, an amendment was published in the Official Gazette on 14 February 2019 and the rate of 70 per cent given in the Decision was changed to 60 per cent. Hence, the new exchange rate for 2019 was announced as 3.40 Turkish lira, with an increase of 26.4 per cent compared to that of 2018. On 14 February 2020, the Price Evaluation Commission determined the Fx rate for 2020 as 3.81 Turkish lira, which brings an automatic increase of 12 per cent compared to 2019.

On 19 February 2021, with a temporary article added to the Decision, the Fx rate to be decided for 2021 cannot exceed 20 per cent of the Fx rate applied in 2020. Upon this amendment, the Turkish Medicines and Medical Devices Agency announced that the Price Evaluation Commission raised the Fx rate to be used in the pricing of drugs to 4.57 Turkish lira as of 20 February 2021.

On 14 February 2022, the Commission raised the Fx rate to be used in the pricing of the drugs to 6.29 Turkish lira and on 8 July 2022 an additional decision was published to increase the rate by 25 per cent in July 2022. Until further amendments, the Fx rate applied until February 2023 shall be 7.86 Turkish lira.

Must pharmaceutical and medical device manufacturers negotiate the prices of their products with public healthcare providers?

According to the reference price system for pharmaceuticals, the maximum price of a pharmaceutical is determined automatically. Therefore, there is no place for negotiation in the system. Manufacturers are free to sell their products below the ceiling price determined through the reference price system.

On the other hand, complementary provisions were introduced with the Regulation on the Alternative Reimbursement of Pharmaceuticals, published in February 2016, allowing companies and the Social Security Institution (SSI) the benefit of discussing the terms and conditions of an alternative reimbursement model for special products. The ultimate aim of the system is to provide quicker access to patients of innovative drugs with respect to their reimbursement. The price set is confidential.

However, a cancellation action was filed by the Turkish Pharmacist Union against some of the provisions of the Alternative Reimbursement Regulation. Although the Council of State initially rejected the case, upon appeal it was determined that the SSI published this regulation without obtaining the prior opinion of the Ministry of Health. Hence some of the articles that were brought to case have been cancelled.

Even though the Alternative Reimbursement Regulation is still valid (with the exception of the cancelled articles), the SSI amended its Drug Reimbursement Regulation, which allows the SSI to continue providing confidentiality on the price of some products.

As to medical devices, product prices are not determined by the MoH. However, medical device companies may negotiate with the reimbursement authority and set a discounted price for their products.

In all cases, public healthcare providers must follow the public tender procedures and, as a general rule, the participant company offering the lowest price in the tender is awarded the tender.

In which circumstances will the national health insurance system reimburse the cost of medicines?

The cost of medicines is reimbursed, provided that they are registered on the SSI reimbursement list.

If applicable, what is the competent body for decisions regarding the pricing and reimbursability of medicinal products?

The MoH, through the Turkish Medicines and Medical Devices Agency, is the competent authority regarding the pricing of medicinal products. The competent body for reimbursement decisions is the SSI. There are also two important committees:

• the Pricing Committee, which is coordinated under the authority of the MoH and involves the participation of delegates from the Ministry of Treasury and Finance and the SSI; and
• the Reimbursement Committee, which is formed by delegates from the Ministry of Treasury and Finance, the Presidential Strategy and Budget Department, the MoH and the SSI.

These committees review the applications and approve their conformity in line with the related pricing and reimbursement legislation.

Are manufacturers or distributors of medicinal products statutorily obliged to give a discount to health insurance schemes or third parties?

According to the Health Implementation Communiqué, the discount rate applied to original pharmaceuticals where no generic version is on the market is 41 per cent in total (11 per cent base discount plus a 30 per cent additional discount), and 28 per cent (11 per cent base discount plus a 17 per cent additional discount) for original products where the generic version is on the market. Twenty-eight per cent (11 per cent base discount plus a 17 per cent additional discount) of the discount is applied to generic products.

The applied discount rates may differ according to the type of product: for example, pharmaceuticals that are more than 20 years old, over-the-counter pharmaceuticals or blood-derivative products.