Department of Economics and Business Economics

TY - JOUR

T1 - Competitive tenders on analogue hospital pharmaceuticals in Denmark 2017–2020

AU - Ehlers, Lars Holger

AU - Jensen, Morten B.

AU - Schack, Henrik

N1 - Publisher Copyright: © 2022, The Author(s).

PY - 2022/10

Y1 - 2022/10

N2 - Background: Competitive tenders on pharmaceuticals are one of the most effective cost-containment instruments in healthcare systems. Its effectiveness has been demonstrated, among other things, in markets for generic medicine and biosimilars. In Denmark, an internationally unique model for competitive tenders on analogue substitutable pharmaceuticals has been developed and implemented for all public hospitals. Methods: We obtained data on all analogue competitive tenders carried out by the Danish Medicines Council from its foundation on January 1, 2017, to October 9, 2020. We calculated univariate descriptive statistics, pairwise correlations and made a multiple regression analysis on tender savings. Results: Average annual saving on hospital pharmaceutical purchase prices was 44.1% ranging from 0.4% to 92.8% between therapeutic areas and areas of indication. There was a significant positive correlation between tender savings and the number of competitors participating in the tender, and a significant negative correlation between tender savings and the number of days since market authorization. Conclusions: This study finds analogue tenders to be similar in effect and mechanism to competitive tenders in markets for generic medicine and biosimilars. It supports the increasing number of empirical findings that competitive tendering has a high potential to generate substantial savings on healthcare budgets.

AB - Background: Competitive tenders on pharmaceuticals are one of the most effective cost-containment instruments in healthcare systems. Its effectiveness has been demonstrated, among other things, in markets for generic medicine and biosimilars. In Denmark, an internationally unique model for competitive tenders on analogue substitutable pharmaceuticals has been developed and implemented for all public hospitals. Methods: We obtained data on all analogue competitive tenders carried out by the Danish Medicines Council from its foundation on January 1, 2017, to October 9, 2020. We calculated univariate descriptive statistics, pairwise correlations and made a multiple regression analysis on tender savings. Results: Average annual saving on hospital pharmaceutical purchase prices was 44.1% ranging from 0.4% to 92.8% between therapeutic areas and areas of indication. There was a significant positive correlation between tender savings and the number of competitors participating in the tender, and a significant negative correlation between tender savings and the number of days since market authorization. Conclusions: This study finds analogue tenders to be similar in effect and mechanism to competitive tenders in markets for generic medicine and biosimilars. It supports the increasing number of empirical findings that competitive tendering has a high potential to generate substantial savings on healthcare budgets.

KW - Analogue competition healthcare cost

KW - Competitive tenders on pharmaceuticals

KW - Cost-containment

KW - Managing access to medicine

KW - Public procurement

KW - Tender system

UR - http://www.scopus.com/inward/record.url?scp=85140649916&partnerID=8YFLogxK

U2 - 10.1186/s40545-022-00464-6

DO - 10.1186/s40545-022-00464-6

M3 - Journal article

C2 - 36273196

AN - SCOPUS:85140649916

VL - 15

JO - Journal of Pharmaceutical Policy and Practice

JF - Journal of Pharmaceutical Policy and Practice

SN - 2052-3211

M1 - 69

ER -