DRUG INNOVATION – UTRECHT UNIVERSITY
“The issue is, in part
economic. But at root
ethical.”
Ethical aspects of the Dutch reimbursement
system for orphan drugs
Student: Domenique van Ommen / Supervisor: Prof. Dr. A. de Boer
18-6-2013
“What, then, is the ethical framework that can guide coverage and reimbursement decisions for orphan drugs into
the future?” (Largent & Pearson, 2012)
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Abstract
BACKGROUND A national discussion about reimbursement of expensive orphan drugs is started in July 2012, in the
Netherlands. Concept advices about the reassessments of reimbursement of three drugs, written by CVZ to
minister Schippers of VWS, were leaked to the press. The advices stated that the drugs should not be part of the
basic insurance anymore. CVZ argued in the definite advice, based on cost-effective analyses, that the drugs should
be part of an alternative financial arrangement to stimulate effective treatments and transparent start and stop
criteria for the use of drugs in question. Rationing of health care seems to be needed.
PURPOSE This thesis focused on the ethical aspects of orphan drug reimbursement. Since people concerned
claimed that the discussion was not about the price of the drugs, I was curious to know about the ethical aspects.
Furthermore, this thesis focused on orphan drugs in particularly. Orphan diseases are in most cases unknown for
its pathophysiology, very rare, severe, life-threatening, and patients cannot be treated or only for a very high price.
Also, reassessment of the reimbursement of many orphan drugs lies ahead. Combined with the expectation that
the amount of personal medicines will grow, due to the progress made in the field of genetics, the ethical dilemma
of reimbursement is put on edge.
FINDINGS There is inequality in life and health care, as illustrated by orphan-diseased patients. The moral dilemma
herein is equality in opportunity versus (maximized) utility. Reimbursement of orphan drugs is in conflict with the
dilemma, because an increase in reimbursed orphan drugs leads to an increased claim to the health care
resources. Therefore, just allocation must be provided. Several ethical rules are of great importance, but interfere
with each other: principle of equality, of necessity, of utility, social status and solidarity. Problem is that they
interfere. Priorities must be set, for patients suffering from life-threatening diseases. Combined with the limited
budget, rationing of healthcare is necessary. Other ethical aspects are the rule of rescue, limited evidence on
orphan drugs due to low prevalence and the temporary reimbursement.
INTERPRETATION In my opinion, it is clear that stringent rules are needed in the Netherlands and improvements
must be made. The advice of CVZ can be an important step forward. Rationing of health care can be done by
determining the most important ethical aspects on which decision making will be based. Furthermore,
effectiveness could be tested per patient, although there are many drawbacks yet to this approach. Another
suggestion is to only fully reimburse any first drug for a life-threatening orphan disease. However, how to prevent
the risk of discouraging the development of better drugs? I regret the decision of minister Schippers of VWS to not
use the advice of CVZ, only the part of negotiating with manufacturers. It is probably all about the money, after all.
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Content
Abstract .........................................................................................................................................................................2
Introduction ...................................................................................................................................................................4
A: Withdrawal of reimbursement of orphan drugs for Fabry and Pompe diseases..................................................4
B: Health care costs ...................................................................................................................................................5
C: Focus of thesis .......................................................................................................................................................6
1: Ethical aspects of health care ....................................................................................................................................7
A: Right to health (care) ............................................................................................................................................7
B: Principle of justice .................................................................................................................................................8
C: Justice in allocation ...............................................................................................................................................8
D: Dutch health care..................................................................................................................................................9
E: Difficulties in making and criticizing public policies ..............................................................................................9
2: Reimbursement of orphan drugs.............................................................................................................................11
A: Designation ‘orphan drug’ in the EU ...................................................................................................................11
B: What has been done to encourage development of orphan drugs in the EU? ..................................................11
C: The ethical issue of the combination of health and the resulting opportunity cost ...........................................12
D: Disadvantages of orphan drug regulation ..........................................................................................................12
E: Reimbursement dilemma ....................................................................................................................................12
3: Moral dilemma ........................................................................................................................................................14
A: Ethical principles in the reimbursement of orphan drugs ..................................................................................14
B: The moral dilemma .............................................................................................................................................15
C: Reimbursement of orphan drugs is in conflict with the dilemma .......................................................................15
D: Future perspective ..............................................................................................................................................15
4: Suggestions ..............................................................................................................................................................16
A: Ethical theories and public policies .....................................................................................................................16
B: Governmental dilemma ......................................................................................................................................16
C: Considerations on the current reimbursement system for orphan drugs ..........................................................16
D: Reimbursement considerations per patient .......................................................................................................18
Conclusion ...................................................................................................................................................................19
Appendix I - Reimbursement in the Netherlands .......................................................................................................21
References ...................................................................................................................................................................22
Abbreviations...............................................................................................................................................................24
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Introduction
July and August 2012, the Netherlands. Newspapers reported about two leaked concept advices of the Dutch
Health Care Insurance Board (CVZ) to minister Schippers of Health, Welfare and Sport (VWS) to take three orphan
drugs out of the basic insurance. This reporting caused a stir, and this stir resulted in the topic of this thesis: ethical
aspects of orphan drug reimbursement. In order to provide context to this thesis, highlights about the advices and
resulting discussion are written down in this introduction, as well as information to gain more insight into the
expenditure of the Netherlands on healthcare.
A: Withdrawal of reimbursement of orphan drugs for Fabry and Pompe diseases
July 2012: The drugs in question are used in the treatment of orphan diseases Pompe and Fabry. The infantile form
of Pompe (an orphan muscle disease with worsening symptoms) can be treated successfully, but for the late onset
form the effect of the drug is modest. (1) (2) Health insurers paid 44 million in 2010 for about 100 patients. For the
disease of Fabry (orphan progressive disease with risks of renal insufficiency and brain infarcts at older age),
patients receive an enzyme therapy which has effect. However, the costs for these 50-70 patients are about 11
million Euros per year in total. The expectation of NRC Handelsblad was that the leaked advices could result in
opening the way to exclude more orphan drugs from the reimbursement system. (2) The drugs for Fabry and
Pompe disease were the first of about 40 drugs which need to be reassessed for reimbursement. Weeda and
Kohler wrote in NRC that in the Netherlands there is no straight standard to assess the cost effectiveness of drugs,
like in Great Britain. Leo Ottes, of the Council for Public Health and Care (RVZ [Raad van Volksgezondheid en Zorg]),
said that a line must be drawn: ‘On the one hand, is it just bad luck for an orphan-diseased patient? On the other
hand, a lot of other therapies cannot be reimbursed if the costs for one patients is about 600,000 Euros.’ (3)
In August 2012, CVZ responded to the fierce reactions to the leaked advice. The chairman of CVZ Arnold
Moerkamp had the same view as Leo Ottes. He said that choices must be made in health care, or otherwise harsh
interventions will be necessary. He thinks that the mandatory excess must be raised, in order to avoid an
impoverished healthcare insurance. Furthermore, he stated that the advice of CVZ was not based on cost savings,
but on effectiveness of the drugs. “Even if a drug was not that expensive, the question is whether or not to
reimburse a drug that is not effective for all patients”. (4) However, since there is no drug effective for all patients,
cost-benefit analyses must be made.
The newspapers gave the impression that the core of the discussion was about the reimbursement of expensive
orphan drugs. However, minister Schippers of VWS told in an interview on Radio 1 she is offended by the
oversimplified discussion. She emphasized that the question is not about whether or not orphan drugs are
reimbursed, but about the efficacy of drugs and if they are available for a fair price. (5) Furthermore, in the
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concept advices was mentioned that the outcomes of cost-effectiveness analyses must decide whether or not the
drugs have therapeutic benefit. Since these data were not available when the concept advices were written, the
minister has not taken a decision about the reimbursement of the drugs in question until then.
November 2012: A press release of CVZ revealed that the definite advice of CVZ to minister Schippers is to remove
the three orphan drugs from the basic insurance, but only when an alternative financial arrangement is set up. The
idea is that by use of the arrangement outside the basic insurance, effective treatments will be stimulated. The
arrangement must result in at least a more transparent use of start and stop criteria for the use of the drugs in
question. Furthermore, the government was advised to negotiate with manufacturers about the prices of the
orphan drugs. (6)
January 2013: Minister Schippers responded to the advice of CVZ. She decided to continue the reimbursement of
the drugs, but without the prospect of an alternative arrangement because she does not see the benefits of such a
regulation. Minister Schippers already started negotiations with the manufacturers about the prices, just as CVZ
advised her. (7)
Although the advice is now given, the discussion is not over. As said before, in the discussion about the
reimbursement of orphan drugs, the costs are not the main problem. However, the costs do form an important
factor. The expenditure on health care costs is not that high yet, but the expectation is that it will keep increasing.
(8) (9) Therefore it is important to review the reimbursement policy for orphan drugs. In the next section,
information will be provided about the health care costs in the Netherlands.
B: Health care costs
In the Netherlands, 10.8% of the Gross Domestic Product (GDP) was spent on health care in 2009, corresponding
with 61.5 milliard Euros. In 2010, this percentage was increased to 11.9%, which corresponds with 70.1 milliard
Euros in absolute expenditure. This increase is caused by two aspects: an increase in the provision of care (increase
in volume) and by more expensive care (increase in price), with the largest impact by the first aspect, the increase
in volume. This increase cannot be explained by the aging Dutch population. Although the aging has already
resulted in an increase of hospital care, an effect on health care costs is not shown yet. Note: the increase of health
care costs can partly be explained by the fact that the international definitions of ‘health care costs’, as defined by
the System of Health Accounts (SHA), were adjusted recently. (10) The Netherlands holds the second highest
percentage of spending money on health care in the world, after the United States. However, several other
European countries show slightly lower values and not all countries calculated the health care costs using the
adjusted definitions from SHA. (10)
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C: Focus of thesis
For the topic of my thesis, I chose a subject related to the discussion about the reassessment of reimbursement of
the drugs for Fabry and Pompe disease. The motive was not to judge the advices of CVZ on the reimbursement of
orphan drugs for the treatment of Fabry and Pompe disease, I was curious to know about the ethical background
of orphan drug reimbursement. Therefore, the focus of this thesis is on ethics and orphan drugs, not on drugs in
general. The reason is my interest in orphan-diseased patients. Not many research is focused on the
pathophysiology of orphan diseases, for many orphan diseases no drug is available and the diseases are most of
the time severe and life-threatening. Furthermore, the prevalence of orphan diseases is very low and the prices for
orphan drugs are much higher compared to most other drugs. The whole situation, of orphan-diseased patients
who are awaiting the reassessment of orphan drug reimbursement, puts the ethical dilemma of reimbursement on
edge.
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1: Ethical aspects of health care
Ethics is incorporated in our lives, in what we perform, do, judge, decide, etc. Ethics is therefore also involved in
our health care system. In order to understand the current regulations and acts, it is important to know about the
principles our health care system is based on. The reason is that acts and regulations are justified by rules, which
are derived from principles, which are based on ethical theories. (11) (12) For health care systems specifically, it is
important to hold in mind that there is a great demand but a lack of resources. In this chapter, ethical
considerations to allocate limited resources in health care are addressed.
A: Right to health (care)
As written in Constitution article 22 (1983) the government is partly responsible for our health. Partly, because we
are primarily responsible for our health. 1 But what about the moral right to health care? Beauchamp&Childress
provided two arguments for a moral right to health care. The first argument is based on the collective social
protection. The government provides, for instance, for the need to live safely and thus protects the population
against threats like crime and natural disasters. Because of the similarity between this need and the need for
health, the government should also provide in health care. However, protection against threats like crime and
natural disasters involves public health, whereas health care is often the case for an individual. Supplemented to
the argument of collective social protection is the right to a decent return. The society invests in several parts of
the medical system like education of physicians, nurses and researchers and the funding of research and hospitals.
It is the society’s right to expect individual health care in return. Note that with a decent return not a full refunding
is meant. The second argument for the moral right to health care is based on the fair opportunity rule, which arose
from the principle of justice. (13)
Fair opportunity rule: “no persons should be granted social benefits on the basis of undeserved advantaging
properties (because no persons are responsible for having these properties) and that no persons should be
denied social benefits on the basis of undeserved disadvantaging properties (because they also are not
responsible for these properties).” (13)
Principle of justice: where a person is entitled to, based on fairness and merit. (13)
What does this mean in practice? Diseases cause unpredictable misfortune and distress. Social institutes like
health institutions should use resources to prevent misfortune and distress, especially for severe or chronic
patients. Furthermore, the resources should be distributed in a fair way. To base the allocation on differences
1
Dutch Constitution Art.22
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between people, like gender or race, is discriminating. These characteristics are achieved by chance and are not
deserved. To achieve just social distribution of health care, the fair opportunity rule was formulated. In addition,
health institutions are obliged to guarantee equality of opportunity. (13)
B: Principle of justice
Aristotle distinguished the principle of justice in distributive justice and commutative justice. 2 Distributive justice
applies to the allocation of resources on a population: ‘one gets what one deserves’. What a person deserves is
based on own achievements where he is responsible for, like his job. Commutative justice is not about allocation
but trading and exchanging, without exclusion of persons. This means that commutative justice is more based on
equality than distributive justice is. In case of our health, there is inequality between people. It is therefore a
matter of distributive justice and the government should handle the allocation of the limited resources in a just
way. (12) The principle of justice cannot be applied solely, but is associated with principles like beneficence and
nonmaleficence.
Distributive justice: to combine person’s achievements with the distribution of benefits and burdens in a
population in a just way. (13)
Principle of non-maleficence: not to inflict harm (30)
Principle of beneficence: the obligation to contribute to the welfare of persons via the prevention and removal
of harms (31)
C: Justice in allocation
As mentioned in section A and B, resources for health care should be allocated in a just way. In order to allocate
resources, there are several factors which could serve as principles to take into account. (12) Five factors will be
mentioned in this section. Decisions about, for example, who is treated first, must not be based on differences in
age, gender, etc. It would be unjust to discriminate on these grounds. This refers to the principle of equality, the
first factor. However, this cannot be the only criterion, for the principle of necessity can sometimes justify the
choice to use different standards within a population, based on the different needs between people. This second
factor can be applied to, for instance, a case where a patient, lower on the waiting list, is treated earlier, due to a
case of emergency. The third factor is the principle of social status. In the Netherlands, everybody is obliged to
have a basic health insurance policy. However, rich people can afford to undergo treatments outside this basic
policy, for they pay for additional insurances or they go abroad for certain treatments.
2
Ethica Nicomachea V
9
It is clear that the three factors mentioned above can complement each other, but also can collide and result in
distressing situations. Inequality becomes injustice when basic necessities can no longer be met for everyone, as
a result of a lack of solidarity. Solidarity is the fourth consideration. One must acknowledge that there is inequality
in welfare between persons, and that one must help those in need. However, the last mentioned and fifth factor to
consider in just allocation is the principle of utility. In case of limited resources, efficient allocation is necessary.
And the resources for health care are limited. It must be clear that it is more efficient to spend a certain amount of
money to cure 50,000 people than to cure 5,000 with the same amount. (12)
D: Dutch health care
The Dutch health care is a mix of both consequentialism and deontologism:
Consequentialism is an ethical theory which can be used as a guidance and which includes principles, wherein
morally appropriate acts can be determined. The content of the theory in short is that the consequences of an
action form the basis of the moral rightness of the action. The most known theory herein is utilitarism, where
specifically the consequence of an action must be a maximization of health or another nonmoral value. Health is
not a moral obligation and therefore cannot be named a moral value. It is a nonmoral value, for many actions hold
health as a general goal. This utilitarism theory is based on the one basic principle in ethics, the principle of utility.
(14)
The second ethical theory which can be used as a guidance to determine acts as morally right or wrong is
deontologism. Followers belief that the rightness of an action must not only be based on the consequences, but
also on the intrinsic features, like fidelity or integrity. (14) This theory focuses more on the individual, compared to
consequentialism.
E: Difficulties in making and criticizing public policies
An ethical theory like consequentialism can function as a moral background to make and to criticize public policies.
But it does not provide specific information, for a theory consists of abstract rules and principles. Making public
policies is therefore a complex process. Specific information must be gained from empirical data and knowledge
from the field of interest. (11) Another difficult aspect of making and criticizing public policies is the following:
“A judgment about acts does not entail the same judgment in law and policy. The judgment an act is
morally wrong does not necessarily lead to the judgment that the government should prohibit it or refuse
to allocate funds to support it. Nor does the judgment that an act is morally acceptable imply that the law
should permit it.” (11)
The drafting of policies is, besides ethical theories, empirical data and specific knowledge, influenced by social
developments and changing roles of the government and other parties. (12) (15) Health care is becoming more
10
expensive, caused by an expansion of our needs and the broader application of the principle of equality and the
right to health. Furthermore, the principle of utility influences the making of justified decisions in public health,
based on the moral obligation to provide health care for as many as possible. (12) However, it is quite
understandable that it is impossible to help everybody in everything. (16) As a consequence, always full
reimbursement of health care costs for everybody cannot be achieved. (17) Furthermore, allocation policies are
subject to changes, based on social developments and shifts in the general philosophy. Consequently, adjustments
will always lead to individual victims. (12) (15) The point is that there is no one fair or just way to assure equitable
access to care. Even with universal coverage, it is impossible to eliminate all inequalities in health care, because
these result from forms of social injustice that are broader than the lack of health insurance. (8)
Principle of equality: To allocate resources equally among all people (12)
Principle of necessity: To treat a person with the greatest need first (12)
Principle of social status: A higher social status results in access to a more extended care (like cosmetic
surgery) (12)
Principle of utility: to aim for the greatest possible balance of benefits over harms (14)
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2: Reimbursement of orphan drugs
Before we arrive at the main topic of this paper in the next chapter, the ethical aspects of orphan drugs
reimbursement, an introduction to orphan drug regulation will be provided in this chapter. For general information
about the reimbursement system of the Netherlands, see Appendix I.
A: Designation ‘orphan drug’ in the EU
‘Orphan disease’ is the term for a rare disease. In European terms a disease is orphan if the prevalence is less than
5 per 10,000 individuals. (16) (18) Due to the low prevalence, the knowledge about the pathology is mostly minor
and the drugs produced are often quite expensive (as a result of the small market). (9) Based on the principle of
opportunity for all and the fact that orphan diseases are mostly severe and life-threatening, several regulations
were made to stimulate the development of drugs for orphan diseases, the so-called orphan drugs. (9) (16) The
official criteria in the EU to apply for a designation of orphan drug are that the drug:
“Is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition
affecting no more than 5 in 10,000 people in the EU at the time of submission of the designation application;
Is intended for the diagnosis, prevention or treatment of a life-threatening, seriously debilitating or serious and
chronic condition and without incentives it is unlikely that the revenue after marketing of the medicinal product
would cover the investment in its development.
Furthermore, it must become the first authorized, satisfactory method of diagnosis, prevention or treatment of the
condition, or, if such a method already is authorized, the use of the medicine must result in a significant benefit to
the affected ones.” (18)
B: What has been done to encourage development of orphan drugs in the EU?
In order to stimulate the development of orphan drugs in Europe, the European Union (EU) introduced the
European Regulation on Orphan Drugs in 1999. Aspects of this regulation are ten years of market exclusivity,
central registration in the EU via the EMA, advice, reduction of registry fees, etc. The European Medicines Agency’s
Committee for Orphan Medicinal Products (COMP) assesses the applications of drugs to achieve the orphan drug
status. The individual countries have national regulations to stimulate orphan drug development. (19)
In the Netherlands exists since 2006, besides the policy for expensive drugs, a specific policy for orphan drugs.
Hospitals are 100% compensated for their spending on orphan drugs. SFK publicized a report about the costs of
expensive and orphan drugs in 2008. The total expenditure on drugs included in the policy for orphan drugs was
56,9 million, compared to 37,3 million in 2007. The expectation is that the costs will increase the next years, for
the policy was quite new in 2008. (20) After designation of the status of an orphan drug, temporary
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reimbursement is provided for three years. After three years, the expediency and effectiveness must be
determined, based on study data. (19)
C: The ethical issue of the combination of health and the resulting opportunity cost
As written in the previous section, the costs for orphan drugs are increasing. Therefore, there is an urgent need to
change the policy conditions. (8) (9)
The combination of health and costs is an ethical issue. Cost containment is also an ethical issue herein. This is
especially the case in the field of orphan drugs, where the costs are high and the diseases rare but mostly severe
and life-threatening. The reason of it being an ethical issue, is that priorities must be set, which requires rationing
of making decisions. There is a limited budget and there are more important, sustainable goals than only
treatment of orphan diseases. On all fields, the allocation of resources must be efficient, but fair to all and deliver
value for money. (8) Daniels et al claimed that efficiency, or utility, must not be an aim in itself. It must be used as
a means to meet as many needs as possible and to do it in a fair way. To achieve the latter, priorities must be set.
Fairness and setting priorities must be used simultaneously in order to achieve health needs. They stated that, as a
consequence, cost containment and setting priorities must be key aims in health care resources allocation. The
general idea is that this is a controversial approach. The fear for rationing care is related to the underlying fear to
excluding people from effective health care. Daniels et al stated that cost containment decisions can be made, if at
least the priorities are set in a transparent way, while considering all evidence and ethical arguments, in
cooperation with appropriate parties and if decisions can be revised as a result of other, emerging concerns. (8)
D: Disadvantages of orphan drug regulation
The first disadvantage of current regulations to stimulate orphan drug development is the moral dilemma of the
need for orphan drugs and the resulting opportunity cost. (16) (21) Orphan drugs are approved after limited
testing, which means that orphan diseased patients are under greater risk. It seems quite noble to give easier
market approval for orphan drugs, but the consequences are that the certainty about the mechanism of action of
the drug can be less sure and that there are more risks involved like (severe) side-effects. In addition, orphan
diseased patients are willing to take more risks than not orphan diseased patients. (21)
E: Reimbursement dilemma
As stated by Beauchamp&Childress, reimbursement is a moral and legal dilemma. In a dilemma, one has to choose
between two possibilities. For example, there are two groups of patients: one group consists of 1,000 people with
hypercholesterolemia, and one group of 10 people suffering from Huntington disease, which is a rare
neurodegenerative disorder. For convenience, assume there is a drug available for both diseases. There is 100,000
Euros to spend on the reimbursement of the drug costs of just one group. Which option would you choose? Which
factors should influence the decision to reimburse a drug or not?
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The difficulty of the dilemma as described above, is that the reasons behind both possibilities are significant
without one dominating. The reasons for each possibility are all good, but one cannot act on all, because of the
opposite possibilities. When choosing one of the options, it will be desirable in some respects and simultaneously
undesirable in other respects. (11)
Constitution article 22 (1983) states that the government is (partly) responsible for the health of the population. 3
This is reflected in the principle of justice as well as in the principles of ‘nonmaleficence’ and ‘beneficence’. In the
Netherlands there is a mandatory health insurance system. Everyone is obliged to buy a basic health insurance. Via
the insurance, many health care issues like most drugs and general practitioner visits are reimbursed. Of course,
not all health care costs can be reimbursed, therefore the dilemma of allocating limited resources is persistent.
Principle of nonmaleficence: not to inflict harm (30)
Principle of beneficence: the obligation to contribute to the welfare of persons via the prevention and removal
of harms (31)
3
Dutch Constitution Art. 22
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3: Moral dilemma
In chapter 2, the policy regulation for orphan drugs was introduced as well as the moral dilemma. In this chapter
the moral dilemma in reimbursement of orphan drugs will be discussed in more detail.
A: Ethical principles in the reimbursement of orphan drugs
“The issue is, in part, economic. But at root ethical.” (13)
In chapter 1C, five factors were mentioned which could be used for just allocation of resources: equality, necessity,
social status, solidarity and utility. These factors can collide, particularly in the case of reimbursing orphan drugs.
(9) The principle of equality, combined with the fair opportunity rule (Chapter 1A), is of great importance during
reimbursement decision making. Should age, the prevalence of the disease or the possible improvement of quality
of life play a role while distributing the reimbursement budget? (22) The second factor that should influence the
allocation includes the differences in needs between patients. Can this be applied to the severity of a disease?
Orphan-diseased patients do need more help, for orphan diseases are mostly severe and life-threatening. The risk
in resource allocation is that the factors can collide. It is therefore important to remain basic necessities available
for all and to show solidarity. Inequality can be necessary and inevitable. However, it must not become injustice.
An important question is: what are our basic necessities? It is impossible to fully reimburse all health care costs for
all people, as a result of the scarcity of resources. A difficult issue herein is: how to implement the principle of
utility? Because it is quite clear that the reimbursement of orphan drugs is an inefficient investment. The drugs are
very expensive, the population is very small and the diseases are quite severe, which means that most patients will
not be fully employable in society.
Another principle, which is included in constitution article 22 (1983) which is of great importance in the
reimbursement of orphan drugs is the principle of beneficence or solidarity. Until now, orphan drugs were fully
reimbursed by the government. However, as stated by CVZ, full reimbursement for all orphan diseased patients is
impossible, for it comes at the expense of solidarity. (17)
Largent et all stated that there are two reasons for the fact that the government is willing to reimburse expensive
orphan drugs for 100%. The first one is that the pharmaceutical industry has to recoup the costs of developing the
drug, while the market is very small. The second is the belief in the rule of rescue. This rule covers the moral drive
to “save identifiable lives in immediate danger at any expense.” (9) However, this drive must be in conformity with
the limited resources. (9)
Rule of rescue: “the moral drive to save the identifiable lives in immediate danger at any expense” (9)
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B: The moral dilemma
We already saw that an increase in orphan drugs on the market in combination with the current reimbursement
policy leads to an increased claim to the health care resources (Chapter 3A). However, drainage of resources from
other health care goals must be prevented. The moral dilemma is equality in opportunity versus (maximized)
utility. (16)
The treatment of orphan diseased patients must be included in the health care goals, which are prevention, cure
and care. (23) The needs for these patients are clear; diseases are mostly severe and life-threatening. Pinxten
stated that it is unethical on the one hand to exclude orphan diseased patients from the health care resources and
on the other hand to allocate unlimited to only this health care objective (or another). Both would be in conflict
with moral obligation of non-abandonment and the principles of utility and equality in opportunity. (16) (24)
C: Reimbursement of orphan drugs is in conflict with the dilemma
Pinxten pleads for reviewing the allocation of orphan drugs according to distributive justice. Reason for this is the
opportunity cost, for allocation of resources to the ‘orphan field’ will result in fewer resources available for other
health goals. As a result, orphan diseased patients and potential treatments are in conflict with two important
aspects at the base of today’s policies: the approaches of utility and equality in opportunity for all. In case of a
utilitarian approach of allocating health care resources, the ‘orphan field’ counteracts the goal of maximum benefit
for the society. (24) (16) The other issue is that equality of opportunity for all cannot be realized in all of the health
care aspects, due to the limited resources (9) (16). What is needed is a middle course, a balance (16).
D: Future perspective
The impact of reimbursing orphan drugs on the health care resources is limited. However, the expectation is that
the number of orphan drugs will increase, as will the expenditure. (9) (20) Consequently, the drive to help severely
diseased patients will come into conflict with the limited resources. Another rising problem is the increasing
opportunities to develop so-called personalized medicines, based on one’s genetic mutations. This will result in
small patients groups with specific drugs which will be expensive for the same reasons orphan drugs are. (9) The
article of Largent et al is based on the health care system and expenditure of America. The percentage of GDP they
spend on health care is much higher than for the Netherlands. (8) However, the concerns about personalized
medicines can be translated to the Dutch system.
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4: Suggestions
In this chapter, the ethical aspects will be investigated with regard to the reimbursement of orphan drugs. Because
although the budget is still sufficient, it is expected that in several years this will not be the case anymore and the
government will be forced to choose between drugs. Therefore, it is important to already take action and to set
clear conditions. Also, a few suggestions are given to change the current policy of orphan drug reimbursement.
A: Ethical theories and public policies
As written in chapter 1, ethical theories only can serve as abstract frameworks to develop public policies.
Consequently, it is hard to develop practical rules, based on an ethical theory, as quoted: “A judgment about acts
does not entail the same judgment in law and policy.” (11) Ethical theories can also be used to criticize public
policies. However, because of the gap between an abstract theory and specific rules, it is also hard to criticize
specific rules. Consequently must the fact that the decisions of CVZ by some people were judged as morally wrong
(see Introduction), not implicate a wrong public policy. Furthermore, the statement of CVZ to stop reimbursement
of some orphan drugs was made within the current public policy. As mentioned in the introduction, this thesis is
not written to judge the acts of CVZ, but to highlight the moral drawbacks of the current Dutch reimbursement
system.
B: Governmental dilemma
The government is obliged to act on the principle of beneficence. On the hand, this means that she must provide
health care to everyone in the society, including equality in opportunity. On the other hand, it is impossible to fully
reimburse all the expensive orphan drugs, for it will seem unfair to the rest of society and it will be at the expense
of their solidarity towards orphan-diseased patients. Both acts would be in conflict with non-abandonment and the
principles of utility and equality in opportunity. Therefore, the government must set priorities and make choices in
what to reimburse, when to reimburse and to which extend. One way to do this is by rationing health care, as
suggested by Daniels et al (Chapter 2C). They stated the decision making must be transparent and evidence-based,
taking into account all ethical arguments. Furthermore, when important concerns rise, revision of previous
decisions must be possible. (8)
C: Considerations on the current reimbursement system for orphan drugs
What in theory is happening, according to the public policy, is the reimbursement of orphan drugs which have
shown proven effectiveness and which do target severe and life-threatening diseases without current treatment.
These decisions of CVZ are based on the principles of equality of opportunity, of necessity, of solidarity and on the
rule of rescue. (21) Such a drug should improve the quality of life and, even better, also slow the progression of the
disease. The diseases at issue should be severe and life-threatening, in order to prevent disease mongering.
17
Necessarily, strict definitions must be made. However, the decision-making is much more complex in practice, for
there are always costs involved. As mentioned in the introduction of this thesis, the high costs for orphan drugs
form not the issue, although the media were putting it like that. M. van der Graaff (department advisor Care
Advice, CVZ) explained that spending 1% of the reimbursement budget on one drug is not insurmountable. (17)
The essence of the discussion is the cost-effectiveness, which is one way of rationing health care.
In the case of an orphan drug with added value, compared to the existing therapy, it is quite difficult to decide
what is ethical justified. On the one hand I would suggest a lowering of the reimbursement percentage, when
there is already a therapy available. On the other hand, this could discourage the pharmaceutical industries to
develop a new, better and more effective drug. If an additional drug would be developed despite of a lower
reimbursement percentage, is it unethical that patients would have to pay more for a more effective drug?
Currently, it is decided drug by drug to reimburse or not. But what if, in several years, the budget is no longer
sufficient? I think the rationing of health care can be more stringent than it is now. One way is to determine which
factors should influence the decision to reimburse an orphan drug or not (Chapter 2E, 3A). In my opinion, factors
as age of onset should not affect the advice. No matter at what age the disease will appear, my conviction is that
everyone’s life is equally valuable. Also the prevalence of a disease must not have influence on the decision. Other
factors may well serve as handles: improvement in quality of life and if there is already something on the market.
About some factors, I am not sure what to decide. As regards the factor of prolongation of life, I guess I would
state that it should not influence the decision about reimbursement. However, this opinion is based on my own
ethical convictions and is not comparable to public policies. Because both are based on ethical theories, but serve
different purposes.
The most unethical aspect of our current health care reimbursement system is the temporary reimbursement of
orphan drugs. First of all, it is equitable to reimburse orphan drugs based on relative small studies, because of the
small patient populations. However, as a consequence, there is limited data available about the efficacy,
effectiveness and clinical benefit. (21) (25) Given the fact that orphan-diseased patients, with a few optional drugs
available, are willing to take more risks than patients with a non-orphan disease, it is quite unfair to reimburse
orphan drugs based on small datasets. In fact, it is in conflict with the principle of beneficence. Secondly, in order
to perform an expediency test, a lot of data is needed. These data had to be obtained in the three to four years of
temporary reimbursement. The problem is, however, that in practice a small number of studies are performed
which makes it difficult to reassess the reimbursement. (21)
It is not exclusively unethical to approve an orphan drug based on limited data. As written by Kesselheim et al, and
I agree with this statement: accelerated approval is justified if it is restricted to breakthrough products like drugs
for orphan diseased patients without current treatment. (21)
18
D: Reimbursement considerations per patient
All people in society have the right to health care. Consequently, there is a lot of money involved but the resources
are limited. What is making the situation more complex is the ethical issue of health care and costs itself. It is not
ethical to allocate the resources for health care only based on the principle of equality. I plead that it is justified to
discriminate between patients based on the differences in needs. I plead for different standards for
reimbursement within the same orphan disease group.
In Chapter 4B, three disadvantages were mentioned about the small datasets, obtained from orphan drugs studies.
It is hard to determine the efficacy, effectiveness and clinical benefit based on a few datasets, there are not a lot of
studies performed during the temporary reimbursement of an orphan drug and the datasets are small in
themselves, due to small population numbers. Another disadvantage is that the statistical results are difficult to
interpret, for the heterogeneity of orphan diseases is reflected in the variability in responses to the drug and thus
in a wide variation in the outcomes. (25)
It is no use to treat all patients equally, thus with the same drug, if it does not provide benefit for them all.
Therefore it is justified to discriminate between patients bearing the same orphan disease and I suggest to assess
the efficacy and effectiveness of a drug case-by-case. Obviously, there are major practical pitfalls to this approach.
Firstly, who must decide whether or not an orphan drug is efficacious? At least not the patient, who will probably
try and use every optional treatment, let alone to mention the placebo effect. Also the pharmaceutical company
cannot obtain data from patients directly. The best option is the treating physician, for he/she already has to
collect data for the company concerned. Important herein is the development of objective standards by specialists,
to prevent biased results. Secondly, it must be decided when the efficacy of a drug will be assessed. That period
will differ for each orphan drug. Although indications can be obtained by the clinical studies already performed, it
will be difficult to determine a realistic period. Thirdly, a complex factor is the definition of efficacy. Is a drug
efficacious if it stops the progression, if it slows the progression, if it improves quality of life or only if it (partly)
cures the patient? Furthermore, it is not always possible to determine the progression of a disease in absence or
presence of a drug. As mentioned by Schlander et al, it is possible that the orphan drug does not seem to be very
efficacious, based on several markers, but at the same time the patient feels better when treated with the drug
concerned. (25)
19
Conclusion
In the next few years, many orphan drugs will be reviewed by CVZ to decide about the reimbursement. These
drugs are very expensive, and combined with the view on more personal medicines, reimbursement will become a
major expense. However, it would be unethical to only stop the reimbursement of expensive drugs for rare
diseases. Fortunately, CVZ is not planning anything like that. Nevertheless, choices have to be made. Besides the
costs, only drugs that prove efficacious will continue to be reimbursed. But in the Netherlands, there is no such
thing as a straight cost-effectiveness regulation. Rationing of health care is necessary, as stated by Daniels et al
(2C).
The question for this thesis was: what are the ethical aspects of orphan drug reimbursement? Orphan-diseased
patients reflect the fact that there is inequality in life. Even with universal coverage, it is impossible to eliminate all
inequalities in health care, because these result from forms of social injustice that are broader than the lack of
health insurance. Still, there are several ethical principles which plead for equality and which can be applied to the
case of orphan-diseased patients.
All people have the right to health care, which is reflected in collective social protection (mainly realized by the
government) and the fair opportunity rule. In order to achieve social distribution, health institutions must
guarantee equality of opportunity. One way to apply this rule is to allocate in a just manner. Several ethical rules
are of great importance, but interfere with each other: principle of equality, of necessity, of utility, social status
and solidarity. Other ethical aspects in the reimbursement of orphan drugs are the combination of health and costs
and the control of these high costs. Priorities must be set, for patients suffering from life-threatening diseases.
Therefore, decisions need to be made at a certain rational level, in order to determine the destination of the
limited budget.
Besides the moral dilemma of the need for curing orphan diseases versus resulting opportunity costs, current
orphan drug regulations have more drawbacks. Drugs are approved after limited testing, mechanism of action can
be less certain and orphan-diseased patients are more willing to bear severe side-effects.
In the field of orphan drugs, the dilemma of need versus costs is a difficult one, as illustrated in the example
mentioned in chapter 3: there is 100,000 Euros to spend on the reimbursement of the drug costs of just one of two
groups, one contains 10 patients suffering a severe and orphan disease, the other 1,000 patients suffer from a less
progressive disease with much milder symptoms. Difficult herein is the fact that the reasons to choose for any of
the groups can be justified, but the two options are opposite. How to combine the factors mentioned earlier?
What are our basic necessities? How to implement the principle of utility when it is clear that orphan drug
reimbursement is an inefficient investment?
20
Solidarity is demonstrated by reimbursing drugs, even expensive drugs. However, the expected rise of this cost
item will happen at the expense of solidarity. Another ethical problem is the combination of the rule of rescue with
the limited resources. All these ethical aspects and difficulties are part of the moral dilemma: equality in
opportunity versus (maximized) utility.
Deciding to continue reimbursement or not and determining the cost-effectiveness of orphan drugs are difficult
issues. Such matters evoke strong reactions, as illustrated in the case of the Fabry and Pompe diseases.
In my opinion, several things can be done. First, there must be less ambiguity about which ethical aspects should
influence the final decision about reimbursing an orphan drug. This also includes more stringent rules about costeffectiveness determination. However, setting stringent rules is especially difficult in the field of orphan drugs. One
suggestion from my side is to test the efficacy of a orphan drug per patient, to bypass the high variation in disease
manifestation and drug responses. There are, of course, a lot of drawbacks to this approach and very clear rules
and regulations will be needed. A third suggestion is to fully reimburse any first drug for an orphan disease that is
severe and life-threatening. Again, clear rules are necessary to maintain such a rule. However, there is a risk to
discourage the development of a more effective drug.
One last drawback of the current regulation is the temporary reimbursement of orphan drugs. The problem is that
in practice, during this period, a small number of studies are performed which makes it difficult to reassess the
reimbursement. Nevertheless, I think that in the decision making of orphan drug reimbursement, many ethical
aspects are taken in consideration. However, improvements must be made. Unfortunately, the only action
minister Schippers of VWS took is to start negotiating with manufacturers. Is it all about the money, in the end?
21
Appendix I - Reimbursement in the
Netherlands
Market authorization applications can be carried out centralized or decentralized. In order to receive market entry
in Europe, the application is assessed by the European Medicine Agency (EMA). (18) At national level, the
assessment is performed by the Medicines Evaluation Board (CBG) (26) (27). Pharmaceutical companies cannot sell
drugs before scientific evaluation and approval toke place. After market entry, agreements about price and
reimbursement are made at a national level. (18)
In the Netherlands, the inclusion of drugs into the Medicine Reimbursement System (GVS) is decided by the
minister of Health, Welfare and Sport (VWS). Pharmaceutical companies can apply for two types of
reimbursement, named List 1A and list 1B. List 1A includes clusters of interchangeable drugs with a price and
reimbursement limit, list 1B contains drugs which cannot be clustered and for which no price and reimbursement
limit exists. The minister of VWS is advised by the Health Care Insurance Board (CVZ) in two steps. Firstly, the
Medicines Committee (CG, earlier known as Medicinal Products Reimbursement Committee (CFH)) will determine
the therapeutic value and budget impact. To apply a drug for list 1B, the pharmacoeconomic analysis must be
extended with a determination of the cost-effectiveness. Secondly, CVZ will consider the social impact and
provides scientific advice, based on the advice of the CFH. The minister of VWS takes the final decision. (28) (27)
In addition to the GVS, there were two policy regulations handled by the Dutch Health care Authority (NZa), one
for expensive medicines and one for orphan drugs. Drugs included in these policies were reimbursed under certain
conditions when supplied in hospitals. Since January 2012, all drugs were included as add-ons in a new regulation
for expensive drugs. Before inclusion, the CVZ advices the minister in two steps, as accounts for applications into
the GVS. Firstly, the CVZ gives advice on temporary inclusion, based on the judgments of the CFH about the
therapeutic value, the budget impact and cost-effectiveness. Secondly, after four years, the NZa must decide about
permanent inclusion of a drug. The CVZ will give advice, based on the results and conclusion of the CFH, which
determines the therapeutic value, the real budget impact, the cost-effectiveness and the application of the drug.
(29)
22
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24
Abbreviations
EMA
European Medicine Agency
CBG
Medicines Evaluation Board, [College ter Beoordeling van Geneesmiddelen]
GVS
Medicine Reimbursement System, [Geneesmiddelvergoedingsysteem]
VWS
Health, Welfare and Sport, [Volksgezondheid, welzijn en sport]
CVZ
Health Care Insurance Board, [College voor zorgverzekeringen]
CFH
Medicinal Products Reimbursement Committee, [Commissie Farmaceutische Hulp]
CG
Medicines Committee, [Commissie Geneesmiddelen]
NZa
Dutch Health care Authority, [Nederlandse Zorgautoriteit]
WGM
Steering Committee Orphan Drugs [Stuurgroep Weesgeneesmiddelen]
SFK
The Dutch Foundation for Pharmaceutical Statistics [Stichting Farmaceutische Kengetallen]
CBS
Statistics Netherlands [Centraal Bureau voor de Statistiek]
RVZ
Council for Public Health and Care [Raad voor Volksgezondheid en Zorg]