Generic substitution and the reference price system

Pharmacies are under certain conditions required to substitute a prescribed medicine with a generally available interchangeable alternative with the lowest price or a price only marginally different from the lowest price.

The Finnish Medicines Agency (Fimea) draws up a quarterly list of interchangeable medicines licensed for sale in Finland. Prices for the interchangeable medicines included on the list must be notified at least 21 days before the first day of each quarter. The notifications must be sent to the Finnish Social Insurance Institution (Kela), which forwards them to the Pharmaceuticals Pricing Board, the Association of Finnish Pharmacies and Yliopiston Apteekki (University Pharmacy).

A notification is required even if the price remains unchanged. Additional price notifications made during a quarter need not be sent to Kela.

Reference price system

Some interchangeable medicines are covered by the reference price system. Medicines covered by the reference price system are specified in a list published by the Pharmaceuticals Pricing Board, which is based on a list of interchangeable medicines prepared by Fimea.

Filing a price notification for medicines covered by the reference price system is a requirement for retaining reimbursability for that medicine. The same price notification as for generic substitution is used in the reference price system. Price notifications made under the reference price system are sent to Kela which forwards them to the Pharmaceuticals Pricing Board.

Based on the price notifications submitted by companies, the Board establishes a reference price for each reference price group, which price is the basis on which medicines in that group are reimbursed. The reference price is valid for the entire reference price period, and may differ from the market price of the medicine.

Single notification procedure

Price notifications for medicines subject to generic substitution and included in the reference price system can be made with a single notification submitted to Kela, which forwards the notification to the Pharmaceuticals Pricing Board, the Association of Finnish Pharmacies and Yliopiston Apteekki (see Timetable for price notifications).

The notification can be made by the holder of the marketing authorisation, the importer or the manufacturer, or by an authorised agent. Companies can notify the wholesale prices of their products at the beginning of each quarter through an online service provided by Kela as well as post information about whether the products in question are generally available throughout the quarter. The price notification service can also be used to report that a product subject to price notification under the reference price system will be removed from the reimbursement system.

The notifications received by the deadline date are used to determine the reference price serving as the basis of reimbursement for a reference price group (chapter 6, sections 19 and 20 of sairausvakuutuslaki/sjukförsäkringslagen) and to identify the lowest price among a group of interchangeable medicinal products and the products that meet the parameters of a price band (section 57 b (2) of lääkelaki/läkemedelslagen).

Price notification through an authorised agent

Quarterly price notifications can also be submitted to Kela by an agent authorised by the company. Companies must make an agreement with an authorised agent and inform Kela of the authorisation. In the case of reimbursable products included in the reference price system, the authorisation must also be notified in writing to the Pharmaceuticals Pricing Board. The notification must indicate the contact information of the party issuing the authorisation and of the authorised agent (including business ID), the period of validity of the authorisation, and package specific details about the products to which the authorisation applies.

Lowest price in a group of interchangeable medicines

The lowest price and the price only marginally different from the lowest price – the interval between which constitutes the so-called price band – are determined on the basis of the price notifications submitted by pharmaceutical companies within a deadline. The price notifications are also used to determine which medicinal products are included within the price band. For each group of interchangeable medicinal products, the lowest price is the retail price (incl. VAT) of the least expensive product as of the first day of the quarter. In an existing reference price group, the lowest price is the lowest retail price (incl. VAT) for the least expensive reimbursable product.

The price band ceiling and the reference price are calculated by adding €0.50 to the lowest price.

Only products for which a notification of market placement has been submitted to Fimea and which are stated to be generally available are included when determining the lowest price and the reference price for interchangeable products.

List of prices notified to Kela

Under a decree of the Ministry of Social Affairs and Health (210/2003), Kela is responsible for publishing, based on the reports submitted to it, a list containing the names and prices of interchangeable medicinal products. The list is published at least 7 days before the first day of each quarter.

The products are arranged into substitution groups at the package level. Pharmaceutical products which contain the same ingredient and are identical in terms of strength and package size are interchangeable. Packages included in the same substitution group are listed under the same code, which consists of 10 numbers.

  • The first two numbers are typically 00 (88 in the so-called exceptional reference price group).
  • The following 4 numbers represent the substitution group assigned by Fimea.
  • The last 4 numbers are assigned by Kela on the basis of the package size.

Certain packages of tablets and capsules share the same four digits even though the package sizes differ slightly.

These include

  • the package sizes 28, 29 and 30, which share the last four digits 0030
  • the package sizes 49 and 50, which share the last four digits 0050
  • the package sizes 98, 99 and 100, which share the last four digits 0100.

Enquiries

Enquiries concerning price notifications and the formation of the price band may be directed at Kela to

  • Katri Auraniemi, Tel. 050 5518276
  • Päivi Puustinen, Tel. 020 551 6909
  • Email: generic.substitution (at) kela.fi

Enquiries concerning the reference price system may be directed at the Pharmaceuticals Pricing Board to

  • Ulla Kurkijärvi, Tel. 0295 163 436
  • Hanna-Kaisa Joutsen, Tel. 0295 163 442
  • Email:  hila (at) stm.fi

 

Additional information