Price regulation and competition among on-patent anticancer drugs in Italy

In recent years, the Italian Medicines Agency has adopted several measures aimed at curbing public pharmaceutical expenditure, including temporary and confidential price reductions, and Managed Entry Agreements. Besides, the Agency plays a pivotal role in price negotiations, serving as a tool for cost containment and financial sustainability for the Italian NHS. Our study aims at testing one potentially relevant channel for pursuing this objective and analyze if the Agency anchors the treatment cost of on-patent market entrants with those of on-patent therapeutic alternatives that previously obtained reimbursement in a given market. Our sample includes 86 anticancer indications which obtained reimbursement in Italy between March 2017 and May 2022, whose marketing authorization was granted under the centralized procedure at European level. Gathering data from multiple sources (drugs Summary of Product Characteristics, their pivotal clinical trials, and an IQVIA database on Italian negotiation dynamics), we identify competing indications within cancer site and treatment line, and then evaluate treatment costs based on median exposure to treatment in pivotal clinical trials. We retrieve prices from hospital expenditure data, which reflect discount negotiated with the regulator, tender, and commercial discounts. Our findings suggest that both the market average and the last reimbursed treatment cost significantly correlate with newly negotiated treatment costs, indicating that earlier negotiation outcomes serve as benchmarks for new ones.