Reference Pricing for Generics: Unplanned Consequences of Planned Swiss Regulation

Review Article

Austin J Public Health Epidemiol. 2016; 3(4): 1043.

Reference Pricing for Generics: Unplanned Consequences of Planned Swiss Regulation

Zweifel P*

Department of Economics, Univeristy of Zurich, Switzerland

*Corresponding author: Zweifel Peter, Department of Economics, Univeristy of Zurich, Switzerland

Received: April 21, 2016; Accepted: June 20, 2016; Published: June 23, 2016


Reference pricing of pharmaceuticals became common during the 1980’s in Europe as a response to ever-increasing Health Care Expenditure (HCE) and pharmaceutical expenditure in particular (see Lopez-Casasnovas and Puig- Junoy [1] for an early review including also Australia, British Columbia, and New Zealand). The most recent initiative is by the European Commission, who seeks to harmonize reference pricing between the member states of the European Union [2]. Although not a member of the European Union, Switzerland too has a reference pricing scheme, which its Federal Office for Health (FOH) seeks to modify for generics. Rather than using a copayment of 10 percent on low-cost and a 20 percent copayment on high-cost generics, the planned new scheme would set the benchmark at the 25th percentile of the price distribution and make patients pay out of pocket for the full excess of price over this benchmark in addition to a basic 10 percent copayment.

Keywords: Generics; Pricing; Consequences; Reference


This paper, based on an expert report commissioned by Intergenerika, the Swiss association of manufacturers and importers of generics and biosimilars, purports to answer the question of whether this modification is apt to improve the performance of the Swiss healthcare system. It therefore adopts a much more comprehensive approach than e.g. Toumi et al. [2] who emphasize effects on HCE. Its starting point is the cost distribution associated with a treatment cycle using a drug that Intergenerika deems realistic for a certain health condition. (Table 1) exhibits the money cost only; the cost of administering the medication borne by patients will be added in (Table 2) below. In view of this generalization, a treatment cycle rather than the DDD (Daily Defined Dose) is used as the unit of reference because the DDD would have entailed time costs amounting to fractions of a minute.