German Bundesrat passes the law to reduce supply shortages of medicinal products

After the German Bundestag, the German Bundesrat approved the law to reduce supply shortages for patent-free medicinal products and to improve the supply of medicinal products for children (ALBVVG) on 7 July 2023. The background to the legislative initiative was that a need for regulation was seen due to the high prescription numbers of generic medicines. The law is intended to strengthen the security of supply of medicinal products in the short and long term.

The law provides that German manufacturers of pediatric medicines will be given more freedom in pricing and that reference prices and discount contracts for these medicines will be abolished. Manufacturers will also be able to raise their prices once by up to 50% of the last reference price, whereby the health insurance funds will have to cover the additional costs for prescribing pediatric medicines. Also, reference price groups may now no longer be formed for pediatric medicines. In addition, antibiotics with EU or EEA active ingredients will be included in the contracts of the health insurance funds on a mandatory basis in order to increase the diversity of suppliers. Furthermore, the co-payment exemption limit will be lowered from 30% to 20% in order to dampen the pressure on prices for fixed amounts. Pharmacies will also receive a surcharge if they have to dispense a drug with the same active ingredient, and the co-payment of the insured will be limited to the prescribed quantity. In the event of market bottlenecks, the pricing instruments for supply-critical medicines can be relaxed. Discount contracts will be adjusted by a mandatory three-month stockpiling to avoid supply bottlenecks, whereby external stockpiling close to supply is also sufficient. The BfArM will receive additional information rights in the event of supply bottlenecks and an early warning system will be set up. Finally, the stockpiling obligations for parenterally administered medicinal products and for antibiotics for intensive care medicine in hospital pharmacies are increased and pricing is changed in order to increase the availability of new reserve antibiotics.

In addition, the following was decided, which was not yet provided for in the original draft law: The new law eliminates the prequalification for pharmacy-usual aids. Zero retaxation will be restricted for pharmacies in certain cases, which is likely to be due to protest actions by pharmacies with regard to the original draft law. In order to counteract a threat to the supply of medicines in the event of supply bottlenecks or additional requirements, oncology drugs are included in the new guideline for increased stockpiling. In future, emergency paramedics will also be able to administer narcotics in a legally secure manner and on the basis of standardized medical guidelines if this is necessary and no doctor is available. In addition, the law creates a legal framework for pilot projects on drug checking. The special regulation introduced in the Corona pandemic to determine incapacity for work after a telephone anamnesis is also possible in future.

The law brings promising measures to improve the supply of medicines, but it remains to be seen whether these are sufficient. In addition, the interactions must be monitored. This also applies to the shifting of costs for improving the provision of medicines for children onto the already financially strained German health insurance system.

The ALBVVG must now be signed by the German Federal President Frank-Walter Steinmeier and will then be announced in the German Federal Law Gazette. Individual provisions will enter into force on the day of pronouncement, other parts at a later date.

Plans from the European Union should also be kept in mind. An initiative of 19 Member States, including Germany, is also dealing with the problem of drug supply shortages. The authors of the Non-Paper offer a parallel, European solution.
In addition, the EU Pharma Package also deals with the problem. You can find the following articles on the new EU Pharma Package on the website:

• The European Commission's pharmaceutical reform package: core objectives and planned changes at a glance
• The EU Commission's new pharmaceutical package: amended legal framework for data protection, marketing protection and market exclusivity
• The reform of marketing authorization procedures for medicinal products in the European Union