All Eyes on Germany

It is going to be an exciting weekend for Germany, and indeed for Europe. On Sunday 22 September Germans will go out and vote for more than 600 representatives in the Bundestag, the main federal legislative house in Germany. We are following this with a lot of interest in Brussels, naturally, but how do our German colleagues feel about the upcoming elections, and their impact on our sector and on Europe? LillyPadEU has five questions for Jeremy Morgan, General Manager for Lilly Germany. Here's what he thinks:

LillyPadEU: In your view what are the main issues at stake in the German elections on Sunday?

Jeremy: By far the dominant issue of the election is the economy and particularly what level of support the German people should offer those countries in Europe that require a 'bailout'. The vast majority of Germans have a strong European identity alongside their perhaps muted national pride, and as an economy with a massive export component understand their leadership role in Europe's economic recovery. Important deep historical cultural beliefs also limit Germany's willingness and energy to be centre stage in EU leadership. How to manage the tension between driving a healthy Europe but not rewarding unsustainable borrowing and spending is at the heart of the debate.

The other key themes revolve around Germany's transition toward an economy purely supported by renewable energy and the potential subsequent issues of associated increased costs for consumers. Finally, national security and data privacy are also regularly debated.

LillyPadEU: Looking at your field of expertise, what have been the main points of debate related to healthcare in the run up to the national elections?

Jeremy: Health policy, unfortunately, is not really at the centre of the debate. But when it is discussed, the main theme relates to the 10% of the population with private health insurance and the amount of money this 10% of the population should pay toward the full system. In addition to these fiscal debates, other secondary themes include the structure and number of our hospitals, and finally the concept of integrated care for the patient. Basically, this involves the potential to pool currently fragmented economic resource across primary and secondary care to better support patients.

Within the industry the debate of course also focuses on healthcare reform and in particular the budget control mechanisms our sector is faced with. Some of these will expire in the New Year to be replaced by measures that are not yet known. The German healthcare system is currently running a surplus. At the moment, all pharmaceutical companies are paying a forced 'rebate'. We hope that the surplus will lead to a relief of these forced rebates in 2014.

LillyPadEU: The German Healthcare system has recently undergone extensive reform. What, in your view, have been the major benefits to the health system to date as a result of these changes?

Jeremy: AMNOG, as the Pharmaceuticals Market Reorganisation Act is called in Germany, was an attempt to establish a value based pricing system. The reform defined value (or price) of a medicine relative to other pharmaceutical products, rather than the full innovation impact to the economy and the healthcare system. AMNOG was also meant to drive competition, with all its obvious benefits. We can observe, however, that implementation in reality leans toward a system of cost management rather than connecting prices to innovation. We think AMNOG can be adjusted, and can evolve to become a working value based pricing system.

It is of course a complex matter, particularly in an era where we are faced with increased budget controls, whilst wanting to drive more rapid access more for patients to new, innovative treatments.

LillyPadEU: What impact might the forthcoming elections have on patients and on our industry more broadly in Europe?

Jeremy: Remember, Germany is often described as the birthplace of the European pharmaceutical industry and has an incredible history in science. Germany today also 'out innovates' its peer group with a significantly higher number of patents registered than in other European countries. Any new government should keep this in mind, and should aim to protect Germany as a centre of investment for our industry. At a minimum, patient access to innovative medicines should be maintained at an equal level to EU peer countries. It is important to have a structured dialogue between the industry and the government in order to ensure continued investment in innovation. Healthcare reform, and in particular integrated care, could offer a significant chance for patients to enjoy better services.

Perhaps a new government might also contemplate increasing the role patients and consumers play in decision-making within the health care system. Strengthening consumer rights would be a great model for the rest of Europe to follow.

LillyPadEU: Let's look ahead to next year's EU elections, how do you think the outcome of the German national elections might influence these?

Jeremy: I believe the next EU election will focus on the Eurozone crisis and the continued support for bailout countries. As Europe's largest economy, the position of Germany remains critical. And, everyone can read in the press these days about the German objectives on rules on better fiscal responsibility at the national level.

Finally, the EU elections will also trigger a debate on the potential transfer of national rights to Europe and the impact on national identity, privacy, economic and social stability.