Roche offers Germany a pay-for-performance deal on Avastin

In Germany’s tight market for new and existing drugs to gain reimbursement, Swiss drug major Roche (ROG: SIX) is proposing to refund hospitals and public insurers in Germany for the cost of Avastin (bevacizumab) if initial courses of the cancer drug fail to help patients, according to Michael Fitzhugh, writing in California, USA, investment bank Burrill & Co’s Burrill Report last week.

Avastin in Germany costs about $4,584 (€3,300) per patient each month, making public expenditures on the drug an easy target for criticism in a country where a value-based drug-pricing scheme has been implemented. The country’s new federal drug pricing law known as AMNOG (Arzneimittelmarkt-Neuordnungsgesetz) launched in January and is designed to generate savings of $2.32 billion in 2011 and annual savings of $2.73 billion thereafter by tying a drug’s price to the value it provides.

AstraZeneca’s clot buster Brilique/Brilinta (ticagrelor) was the first drug to be reviewed under the much criticized AMNOG scheme (The Pharma Letter October 5), which has been described as “unparalled” and anti innovation by Eli Lilly’s chief executive John Lechleiter (TPL July 11).