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Drug Firms Call for Changes to German Law That Controls Drug Prices

Until recently, German drug companies alone could determine the price of new drugs on the market. But in 2011, a new law was passed requiring drug companies to prove that a new drug is more efficient in cost-benefit analyses than comparable drugs already available. Drugs that show added value can have higher prices, but the prices must now be negotiated between pharmaceutical and health insurance companies. Germany’s Institute for Quality and Efficiency in Health Care (IQWIG), which conducts the studies, says the new law is working: five of the 10 new drugs evaluated in the study offered noteworthy added value for certain indications compared to similar drugs already on the market. Pharmaceutical companies and certain conservative politicians say that the drugs used for comparison should be made public early on, to enable drug companies to better prepare for the evaluations.

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