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EU Market Overview Parson Q1 Dec 2010
 

EU Market Overview Parson Q1 Dec 2010

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Overview of Medical Device Markets in EU and Reimbursement

Overview of Medical Device Markets in EU and Reimbursement

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    EU Market Overview Parson Q1 Dec 2010 EU Market Overview Parson Q1 Dec 2010 Presentation Transcript

    • Overview of EU Medical Device Market Environment Bob Parson Vice President Pharmacoeconomics & Outcomes Research Alere, Inc.2nd Annual European Medical Device Reimbursement Workshop 1
    • Agenda  Examine current status of the EU markets  Establishing main differences between US and EU markets  Anticipating changing landscape due to economic changes2nd Annual European Medical Device Reimbursement Workshop 2
    • Major EU Markets  The five largest medical device markets in Western Europe: Germany, France, UK, Italy, Spain2nd Annual European Medical Device Reimbursement Workshop 3
    • Major EU Medical Device Markets  Like all other sectors, the medical device markets will continue to be impacted by the global economic recession in the short term.  Global economic changes will have a major impact on domestic manufacturing industries where the demand for exports are sizable.  The economic downturn has lead to a strain on government health spending as has increasing health costs, aging populations.  Widening gap between health care costs and funding causing regulation of prices and capping of budgets.  Forecasts indicate that beyond the current recession, Western Europe is expected to return to growth with leading markets averaging compounded annual growth rate (CAGR) of 5.4% to 2014 (Euromonitor International)2nd Annual European Medical Device Reimbursement Workshop 4
    • Medical Devices Market: Forecast for Growth Region 2009 2010 2011 2012 2013 Americas 102.4 107.1 112.1 117.4 122.8 Asia / Pacific 42.5 46.1 49.9 54.3 58.9 Central / E Europe 10.3 11.3 12.4 13.6 14.8 M East / Africa 5.7 6.0 6.3 6.7 7.0 Western Europe 62.3 66.7 71.6 76.9 82.5 Total 223.2 237.2 252.3 268.9 286.0 In Billions USD Source: Medical Market Fact Book 20082nd Annual European Medical Device Reimbursement Workshop 5
    • EU Market Overview  Proving that a medical device is safe by conforming to the European Medical Devices Directive (93/42/EEC) and affixing the CE mark used to be the only pre-requisite to marketing in Europe.  Now, governments want to ensure that they are getting „value for their money‟ and are assessing the cost effectiveness of treatments before agreeing to pay for them. In some European countries, treatments are not even allowed on a private basis unless they have government approval.  This approval is obtained through some form of Health Technology Assessment (HTA). Increasingly, a medical device has to be associated with an approved treatment appearing on an official „reimbursement‟ list before it can be sold to healthcare providers in a particular country.2nd Annual European Medical Device Reimbursement Workshop 6
    • Regulatory Approval Enables Market Access US FDA-”Approval” EU: CE Mark  Relatively higher hurdles  CE Mark requires lower (510k or PMA) hurdles  Reimbursement not  Country specific market guaranteed, can be a very access and payment lengthy process  Pricing variations are  Manufacturer can set a common, but can be target price upon approval controlled  Post market studies may  Greater rewards for be required innovation and early entry2nd Annual European Medical Device Reimbursement Workshop 7
    • EU Market Overview  Medical devices need to be associated with a coded reimbursable medical procedure in each geographic market within the country.  In Italy and Spain, reimbursement lists are regional and for some medical devices, achieving reimbursement will require negotiations with individual hospitals.  In Germany, the situation is much less complex and the systems and procedures more advanced. However, this does not stop the process from taking years, on an average.2nd Annual European Medical Device Reimbursement Workshop 8
    • French Market Access Pathway for Medical Device Source: ISPOR Website2nd Annual European Medical Device Reimbursement Workshop 9
    • Reimbursement Process: France French Pricing & Reimbursement (PR) process for medical devices Source: ISPOR Website2nd Annual European Medical Device Reimbursement Workshop 10
    • Reimbursement Process: France Source: ISPOR Website2nd Annual European Medical Device Reimbursement Workshop 11
    • Germany Health Care System  Insurance based Health Care System: statutory duty to insure all residents, e.g., “individual mandate”  90% are enrolled in public, non-profit health insurance funds (more than 250)  One standard list of benefits for all insured, also as statutory basic tariff in private health insurances  Free choice of Health insurance Tariffs (standard with free choice of provider; PPO, HMO, primary care)  Regulations to ensure quality and contain costs. Source: Federal Ministry of Health2nd Annual European Medical Device Reimbursement Workshop 12
    • Reimbursement Process: Germany DECISION MAKERS AND DECISION-MAKING PROCESSES DIAGRAM Source: ISPOR Website2nd Annual European Medical Device Reimbursement Workshop 13
    • Markets within Markets  There has been a strong growth in imports across western Europe accounting for around 80% of the market. Trade between EU dominates the import market, and companies wanting to exploit the full potential of major European countries need to ensure an effective marketing and distribution network.  Critical factors affecting the market‟s growth potential are changes in the regulatory environment and governmental measures such as spending controls on medical devices.  The significant increase in an aging patient population, along with an increasing chronic disease patients will keep the demand for medical devices and equipment maintained.2nd Annual European Medical Device Reimbursement Workshop 14
    • Factors Affecting Medical Device Market Growth  The mature and high value medical device markets in Western Europe are well established and capable to integrating new technology. There are increasing pressures on governmental regulators and private insurers attempting to contain health costs and a desire to remain at the forefront of technological innovation, hospitals will need to invest in new medical equipment and technologies to maintain this high standard of care.  In addition, healthcare services will need to become more efficient in order to cope with financial pressures and the needs of ageing populations. There will be an increased demand for efficiencies, for example, medical devices that facilitate minimally invasive surgery, which can increase the number of operations performed in day surgery and ensure a faster turnaround of patients. Despite recessionary pressures, market growth rates over the coming years will be positive.2nd Annual European Medical Device Reimbursement Workshop 15
    • Overview on Provider Payment Methods • Primary Health Care: • Hospital Payment • Input-based line item budget • Product Price lists • Fee-for-Service • Hospital Day (per diem) • Capitation adjusted by age • DRG‟s and gender • Germany: G-DRGs • Capitation-Fee-for-Service • France: Groups mix Homogenes de Sejour • Pay for Performance(P4P) (GHS) • UK: Healthcare Resource Groups (HRG) • Italy: US Medicare DRG (v.24 Adapted) • Country / Region annual budgets + DRGs2nd Annual European Medical Device Reimbursement Workshop 16
    • Reimbursement Process: Italy Source: ISPOR Website2nd Annual European Medical Device Reimbursement Workshop 17
    • Reimbursement Process: Italy Source: ISPOR Website2nd Annual European Medical Device Reimbursement Workshop 18
    • Tightening NHS budgets Impact Markets  Revenue streams, particularly in early launch, are less predictable and slower to develop  Market entry will require innovation; premium price will require proven value.  Population growth doesn‟t necessarily align with market potential  Product development, expectations, will need to reflect global realities  New challenges for integration of design, regulatory, clinical and marketing strategies * Hull Associates presentation, Advamed Reimbursement Workshop, November 20102nd Annual European Medical Device Reimbursement Workshop 19
    • Trends in EU Reimbursement • Greater opportunities for premium reimbursement • Requires clinical studies, HTA and evidence based effectiveness to support premium reimbursement • Reward for innovation, particularly with efficiencies and lower complications • Cost effectiveness studies are not required to enter the EU market but will become more important for reimbursement and adoption • Cost impact required for France, Germany, Italy, Belgium, Italy and Spain • Greater need for HTA with more networking and sharing of economic evidence2nd Annual European Medical Device Reimbursement Workshop 20
    • European Commission: Exploratory Process Background: An exploratory process on the future of the medical devices sector has been put in place over the second semester 2009 to map the existing public health and industrial challenges in the sector and investigate possible topics of reflection at the European level. This process has provided for industry, users, and consumers of medical devices with an opportunity to share existing challenges.2nd Annual European Medical Device Reimbursement Workshop 21
    • European Commission: Exploratory Process  Objective The objective of the exploratory process on the future of the medical devices sector was to gather at the end of the process:  an overview of existing public health and industrial challenges,  to identify current dynamics of the industry and highlight key topics of interest at the European level which has resulted in a set of suggested themes of potential further reflection adopted by the members of the exploratory process.2nd Annual European Medical Device Reimbursement Workshop 22
    • Exploratory Process on the Future of the Medical Devices – Commission Membership • EUCOMED : Trade association • UEMS : European Union of Medical representing the medical technology Specialists industry • ESC : European Society of Cardiology • EDMA : European Diagnostic • EFORT : The European Federation of Manufacturers Association National Association of Orthopaedics and • COCIR : European Coordination traumatology Committee of the Radiological, • ESR : European Society of Radiology Electromedical and Healthcare IT Industry • HOPE : The European Hospital and • EUROM I : European Optical Industry Healthcare Federation committee • EPF : The European Patients Forum • EUROM VI : European Industrial • BEUC : The European Consumers Federation committee on Medical Organization Technology • ESIP : The European Social Insurance • EHIMA : European Hearing Instrument Platform Manufacturers Association • AIM : Association Internationale de la • EUROMCONTACT : European contact Mutualité lens and lens care industrys association • PGEU : Pharmaceutical Group of the • FIDE : The Federation of the European European Union Dental Industry • EFCC : European Federation of Clinical • CPME : The Standing Committee of Chemistry and Laboratory Medicine European Doctors • CED : Council of European Dentists • EAHP: European Association of Hospital Pharmacists2nd Annual European Medical Device Reimbursement Workshop 23
    • European Commission – Exploratory Process  Final Report Published January 28 2010  Future challenges and opportunities for public health and medical technologies developments  Balance between the patients needs and financial sustainability  Competitiveness and Innovation of the medical devices industry2nd Annual European Medical Device Reimbursement Workshop 24
    • WHO Project on Priority Medical Devices  Designed to identify the gaps in the market for medical devices and to focus on meeting health and health-care needs and addressing critical conditions. • put in place appropriate regulatory systems; • harmonize the nomenclature and classification systems; • ensure that devices have proven benefits to the patient before they enter the market; • carry out systematic needs assessments to avoid under-use of medical devices; • ensure that clinical guidelines describe a specific technology; • ensure proper training to prevent damage; • ensure the technology is used in the proper context; • ensure human factor engineering and context appropriate design; • be aware of the factors that play a role in diffusing a technology2nd Annual European Medical Device Reimbursement Workshop 25
    • Thank You!! Bob Parson robert.parson@alere.com2nd Annual European Medical Device Reimbursement Workshop 26