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German patients get the latest drugs for just $11. Can such a model work in the US?

Noam N. Levey, Los Angeles Times on

Published in Health & Fitness

BERLIN -- Patients who come to the Havelhohe cancer clinic in the leafy outskirts of Germany's capital are often very sick.

Struggling with advanced-stage cancers, many need strong doses of expensive, cutting-edge chemotherapy that can run into the hundreds of thousands of dollars.

But like all Germans, none of the patients sitting quietly in the infusion ward here pay more than 10 euros a prescription, or about $11. "We never talk about costs," said Dr. Burkhard Matthes, a senior oncologist at the clinic.

Germany's ability to provide citizens access to the latest drugs while keeping patients' costs so low is made possible by a novel strategy launched in 2011 to rein in exploding prices that were threatening to bankrupt the nation's health care system.

Mixing free market incentives to encourage innovation with regulation and lots of transparency, Germany's drug review process gives manufacturers the chance to bring new products to market and charge higher prices -- but only if they can show the new medications are better than existing ones.

Nearly the entire process is open to the public, giving doctors, hospitals and patients access to not only new drugs, but also independent evaluations of how well they work.

 

And it's kept drugs accessible. Just 7% of Germans reported cost-related problems getting medical care in the last year, compared to a third of Americans, an international survey found.

"There is a lot we could learn," said Leigh Purvis, who oversees prescription drug policy for the AARP and has urged U.S. policymakers to more closely study the German model.

Germany, like the U.S., relies on private health insurers and private doctors. The German government doesn't set drug prices, as some European nations do. And the country -- home to some of the world's largest drugmakers -- has a robust pharmaceutical market.

"Germans don't believe the government should run the health care system," said Franz Knieps, a former senior government health official who now heads an association of large German insurers. "But they wanted a system that's affordable."

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