Healthcare, Regulatory and Reimbursement Landscape - Poland, New Report Launched

Factors such as the growing elderly population, increasing availability of affordable medicines, and transparent regulatory guidelines will provide the necessary impetus for the growth of the Polish pharmaceutical market, but a decrease in mark-up prices and the country’s stringent drug reimbursement budget will hinder growth

The pharmaceutical industry plays a key role in Poland’s healthcare system and economy. It was valued at $8.6 billion in 2013 and is projected to reach $15 billion in 2020 at a Compound Annual Growth Rate (CAGR) of 8.3% (AESGP, 2014). The pharmaceutical market had decreased from $8.8 billion in 2011 to $7.1 billion in 2012 due to the implementation of the new Reimbursement Act by Poland government in 2012, but has since partially recovered. According to the new act, the prices of the reimbursed drugs were decreased and the profit margins for wholesalers and retailers were also reduced, which impacted the pharmaceutical market negatively. The highest mark-up possible for reimbursed medicines was reduced from 9.78% in 2011 to 7% in 2012 and then to 6% in 2013. The VAT on pharmaceuticals and medical devices was 8% (ISPOR, 2013; EC, 2014). In 2013, the pharmaceutical market recovered and reached $8.6 billion due to an increase in demand for and consumption of pharmaceuticals (ISPOR, 2013).

Generic drugs have a dominant position in the pharmaceutical market. In 2012, the share of generic drugs was 66% of the pharmaceutical market, which increased from 62.2% of the total pharmaceutical market in 2011.

The prices of pharmaceuticals are lower in Poland than in other European Union (EU) member countries. These low prices enhance the affordability of pharmaceuticals, boosting the pharmaceutical market.

The cap on the reimbursement budget for drugs was decreased from 21% in 2010 to 17% in 2011 of the National Health Fund (Narodowy Fundusz Zdrowia, NFZ), so patients now have to pay more for their treatment. The NFZ administers funding and contracts providers to provide healthcare services, both for prophylaxis and therapy. The majority of resources are allotted to in-patient treatment, followed by reimbursement of medications, out-patient general care and specialized out-patient care. The value of the NFZ’s total drugs reimbursement decreased from PLN8.8 billion ($3 billion) in 2011 to PLN6.9 billion ($2.1 billion) in 2012. The decrease in the reimbursement budget would negatively affect the overall pharmaceutical market.

In Poland, the government has taken steps to increase R&D expenditure. In 2013, the expenditure on research in healthcare has been estimated at $633.5m, from $300.8m in 2008. The healthcare R&D increased at a CAGR of 22.6% over the 2008-2013 period (CSO, 2014c).

The major multi-national pharmaceutical companies in Poland are Sanofi, Novartis, GlaxoSmithKline (GSK), and Roche. Polpharma is the major local player in Poland. In Poland, imports of pharmaceuticals accounted for $4.9 billion of the total pharmaceutical market in 2013.

The medical device market was worth $2.2 billion in 2013 and is projected to reach $2.8 billion by 2020, at a projected CAGR of 3.6%. In Vitro Diagnostics (IVD) (20.3%), ophthalmic devices (18.3%), and cardiovascular devices (13.4%) were the major segments in the medical device market in 2013. With a rapidly growing elderly population and awareness of chronic diseases rising, the medical care and diagnostic markets are expected to see strong growth in the future.

Poland’s regulatory authorities provide a transparent and efficient regulatory system which facilitates the approval of pharmaceutical products and medical devices, positively influencing the market’s growth prospects

The main regulatory authority for pharmaceutical products is the Office for the Registration of Medicinal Products, Medical Devices and Biocidal Products (Urząd Rejestracji Produktów Leczniczych, Wyrobów Medycznych i Produktów Biobójczych Rzeczpospolitej Polskiej (URPL)), which works under the guidance of the Ministry of Health (MoH). Obtaining Marketing Authorization (MA) for a new drug requires the execution of Good Laboratory Practice (GLP) and satisfactory compliance reviews for safety, efficacy and quality by the URPL and the MoH. It takes the URPL 210 days from the date of application to approve a new drug, and authorization is valid for five years (MPI, 2009).

The MA process for pharmaceuticals in Poland is aligned with the EU process of registration, which increases the transparency in the regulatory process.

The Agency for Health Technology Assessment (AHTA) was established as an advisory body to the MoH. AHTA opinion is said to be crucial for the MoH to give the final decision in the approval process.

Universal healthcare coverage, access to healthcare facilities and affordable pharmaceuticals are the distinguishing features of the Polish healthcare system

The healthcare system in Poland is financed mainly by health insurance contributions from state and local government budgets. The percentage of Gross Domestic Product (GDP) spent on health was estimated at 6.7% in 2013 (World Bank, 2014i).

The MoH offers universal access to healthcare, covering the entire population. The public healthcare insurance system is provided by the NFZ under the MoH. The NFZ is responsible for negotiating with regional healthcare service providers and supplying health services to the Polish population, but is not permitted to operate or own healthcare institutions. It is supervised by the Fund Council, and covers health services such as primary healthcare, out-patient specialized medical procedures, dental care, in-patient care, mental healthcare and long-term medical care.

Private health insurance is not well-developed in Poland, but is gaining popularity as a supplementary service alongside public insurance. Private insurance companies provide extra services not covered by public health insurance bodies, but at an additional cost.

The prices of pharmaceuticals are lower in Poland compared to other European Union (EU) countries, which enable increase in access of medicines to people (Simoens, 2009).

Government healthcare policies in support from the EU member countries, contributing to growing efficiency of healthcare system

The Operational Program Infrastructure and Environment, financed by the European Regional Development Fund (ERDF) and the Cohesion Fund (CF) during 2007-2013, aims at increasing Poland’s investment attractiveness.

The ERDF has allotted $105.5m for improving the quality of healthcare services and for the development of life-saving drugs. Approximately 350 healthcare projects were supported, including the construction/renovation of landing grounds for helicopters, modernization of hospital rescue wards and the purchase of modern medical equipment (MoH, 2014). The government gave priority to education. In 2010, in Poland, public spending on education was 5.2% of GDP (World Bank, 2014q).

Government initiatives and an increase in funding from the EU will drive economic growth

Poland has a stable system of democratic government, and offers a safe environment for economic activity and long-term planning due to its stable prices and consistent GDP growth. In order to attract foreign investors, the government has established a number of Special Economic Zones (SEZ) for the operation of businesses on preferential terms, providing tax exemptions, including for income and property tax. The exemption from taxes granted in the SEZ is regarded as publicly funded regional aid, which serves to boost the development of the most poorly developed regions by supporting new investments and creating new workplaces (PAIZ, 2014c).

The inflow of funds from the EU to Poland has increased in recent years and is set to grow further. In November 2013, the EU allocated $139.7 billion, including $96.2 billion as part of a cohesion policy and $36.7 billion as part of agricultural policy payments for the 2014-2020 period (MSP, 2014a). The majority of the funds will be invested in areas such as scientific research and its commercialization, the development of key road connections including motorways and expressways, business development, the creation of environmentally friendly transport systems, digitization initiatives such as broadband internet access programs and the introduction of government e-services, and for the inclusion of social and professional development activities (PAIZ, 2014a).

Know more about this report at: http://mrr.cm/Z7y