Italy Serves Cautionary Lesson for New Trump Drug Plan - (Morningstar via NewsPoints Desk)

  • Although the administration of US President Donald Trump has proposed tying drug costs to performance, similar measures failed to reduce drug spending in Italy, Morningstar reported Tuesday.

  • Officials and industry insiders note that one obstacle to the success of such agreements has been disagreements between regulators and drugmakers in measuring efficacy.

  • "The money isn't going back to them or their department," remarked University of Catania Medical School professor Filippo Drago, adding "the performance of these agreements is very low."

  • According to public filings, Italy currently has about 50 outcomes-based agreements with drugmakers including AstraZeneca, GlaxoSmithKline and Novartis.

  • In one such agreement, Italy only received 1 percent in reimbursement from Merck KGaA for its cancer drug Erbitux, compared to average rebates of 28 percent negotiated by health insurers and pharmacy benefit managers for drugs in the US.

  • "These contracts are just for show," explained Peter Bach, director of the Center for Health Policy and Outcomes at the Memorial Sloan Kettering Cancer Center, continuing "it's just a distraction from the central problem: price."

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