EU & UK Reference Pricing Guide

EU and UK Reference Pricing Considerations Guide


The EU is notoriously known for the variety of market access rules its member states impose. We’re here to guide you through navigating EU and UK reference pricing with a quick overview of the 3 key considerations:

  • Formal vs informal procedures
  • Reference baskets and price calculation methods
  • Price points used and the shift towards net prices.

What is reference pricing?

International reference pricing (IRP) is a method used by 26 out of 28 EU member states to control national drug prices by using other countries’ prices as a benchmark.

Formal vs Informal procedures

EU map showing member states which use formal and informal procedures

International reference pricing procedures can be formal or informal. The primary means that IRP is codified into the country’s regulatory system whereas the latter means that IRP is only informally considered by the country HTA or during pricing negotiations. Additionally, countries also re-reference at different times e.g. only at launch, quarterly, annually etc.

Reference baskets and price calculation methods

Different EU countries have different ‘reference baskets’ (groups of countries they use as a reference). Whilst Austria references most other European countries, Norway’s reference basket includes nine countries, all with a similar GDP.

It’s also key to consider how the launch country calculates drug prices as these methods can also differ between member states. For example, Austria uses an average of the prices from its reference basket whereas Greece takes an average of the lowest 3 prices in its reference basket.

Price points used and the shift toward net prices

Price points used to make the comparison can also differ country to country. Whilst some countries use ex-factory prices others consider wholesale or retail prices.

Countries such as Belgium, Italy and Poland specifically request net prices within pricing submissions. We are seeing an increasing pressure for reference pricing to use net prices. The World Health Organization’s transparency directive is set to disclose net prices paid however, countries such as the UK, Japan and Germany refuse to sign. Currently, similar information is accessible on a European level through the European Medicine Price Database.

RELATED ARTICLE: A Dive into the Complex and Expensive World of Gene Therapy Pricing and Access.

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