Academic journal article Applied Health Economics and Health Policy

Soft Regulations in Pharmaceutical Policy Making: An Overview of Current Approaches and Their Consequences

Academic journal article Applied Health Economics and Health Policy

Soft Regulations in Pharmaceutical Policy Making: An Overview of Current Approaches and Their Consequences

Article excerpt

It is a challenge to improve public health and satisfy the needs of a population within limited resources. National healthcare policies seek to balance many conflicting demands such as the need to limit growth in expenditure whilst still allowing the population to have rapid access to new innovative and expensive technologies. Policy making in healthcare is highly politicized and involves many players, including healthcare professionals, the pharmaceutical industry, patients and a variety of stakeholders at the local, regional and national level. We believe that this calls for new forms of governance and approaches in addition to those traditionally applied. Increasing pressures on resources also enhance the need to learn from other areas of society. The pressures on pharmaceutical expenditure are well known and include increased volumes with an aging population and growing prevalence of chronic diseases, stricter management targets, and the continued launch of new expensive drugs costing $US50 000-100 000 per patient per year or more.[1-5] This situation becomes even more challenging and imperative to progress given the current severe economic difficulties.

This article describes the characteristics of the traditional educational, organizational, financial and regulatory methods to influence healthcare professionals. It also presents the theoretical framework behind new modes of governance, i.e. the 'soft regulations', as the first step in developing new demand-side reforms. The paper focuses on pharmaceuticals, since drug prescribing is one of the most important processes in healthcare with costs increasing faster than other aspects of care.[1,6-8] Furthermore, pharmaceutical policy making is driven by both professional and market forces, sometimes strengthening each other, at other times clashing.

We hope this opinion article initiates the debate to develop new methods to enhance the quality and efficiency of healthcare, given growing pressures. These are urgently needed without resorting to other measures such as additional supply-side controls, including very strict clinical and economic criteria for granting premium prices for new drugs, reference pricing across all therapeutic classes as well as stringent price-volume agreements and price cuts, which may not be in the best interest of key stakeholder groups.

To initiate this debate, the paper lists a number of demand-side approaches and concerns. This opinion piece focuses principally on Europe, as this reflects the authors' considerable research experience. The examples are, however, increasingly relevant to the US with its growing public expenditure on health and ongoing demand-side initiatives to ensure the significant proportion of GDP spent on healthcare[9] produces value for all key stakeholder groups. The examples of initiatives in this article are based mainly on a MEDLINE literature search of studies published between 2000 and 2008, using the following search terms: 'pharmaceuticals', 'drugs', 'reforms', 'regulations', 'expenditure', 'guidelines' and 'rational prescribing'. This search was supplemented by additional papers known to the authors, who are active in different research teams representing various disciplines including clinical pharmacology, pharmacoepidemiology, business economics, health policy and social sciences. It is, however, important to stress that this paper is not a systematic review or critical appraisal documenting methodologies, findings and conclusions. Consequently, the paper should be seen as an opinion paper, which we hope will stimulate debate to guide future research and activities.

1. Traditional Models for Influencing Behaviour of Healthcare Professionals

Stakeholders across Europe and the US use a variety of methods to influence physicians' and patients' behaviour. The main strategies can be abbreviated to the 'four Es': Education, Engineering, Economics and Enforcement (table I).[10,11]

Table I. …

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