Spillovers of Pharmaceutical Price Regulations: evidence from the AMNOG Reform in Germany

Simona Gamba, Paolo Pertile and Righetti, G.;

Health, Econometrics and Data Group (HEDG) Working Papers from HEDG, c/o Department of Economics, University of York

Abstract: In years of growing pharmaceutical spending, the adoption of new health technologies faces several regulatory hurdles. Such policies are typically studied at the country level, even though there are explicit and implicit channels that link decisions made in different countries. This can be relevant in the EU, where external reference pricing is widely adopted. This work exploits the IMS pricing database of cancer drugs approved by the European Medicine Agency between 2007 and 2017 to assess the impact of a pharmaceutical pricing regulation change that occurred in Germany in 2011 (the AMNOG bill) on foreign pharmaceutical prices. We show that the impact on foreign prices depends on whether the foreign country adopts external reference pricing policies and whether it includes Germany in its basket of reference countries and, symmetrically, if it enters Germany’s reference set. In particular, our diff-in-diff approach shows that AMNOG led to a price reduction for products launched in countries that refer to Germany (indirect spillover effect), whereas products launched in countries referenced by Germany experienced a 5.48% price increase (strategic spillover effect).

Keywords: AMNOG; pharmaceutical regulation; external reference pricing; difference- in-difference; spillover effect (search for similar items in EconPapers)
JEL-codes: C78 I18 O38 (search for similar items in EconPapers)
Date: 2022-07
New Economics Papers: this item is included in nep-eur
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Persistent link: https://EconPapers.repec.org/RePEc:yor:hectdg:22/20

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