The Impact of the Pharmaceutical Pricing System on Cost-Effectiveness Results: Finnish Analysis

Taru Hallinen*, Erkki J. Soini
ESiOR Oy, Tulliportinkatu 2 LT 4, 70100 Kuopio, Finland.

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© Hallinen et al.;

open-access license: This is an open access article distributed under the terms of the Creative Commons Attribution 4.0 International Public License (CC-BY 4.0), a copy of which is available at: This license permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.

* Address correspondence to this author at the ESiOR Oy, Tulliportinkatu 2 LT 4, 70100 Kuopio, Finland. Tel: 358505681894; E-mail:


In Finland, the drug retail prices are determined with a regressive pharmaceutical pricing scheme (PPS) that leads to higher absolute sales margins for products with higher wholesale prices. At the same time low-priced products are sold at prices below the true costs of drug delivery. Despite these characteristics retail prices are used to represent all drug costs in health economic evaluations that are required before societal reimbursement of new drugs can be granted. We assessed the impact of PPS induced cost differences on the results of cost-utility analyses in hypothetical examples. The examples show that the Finnish PPS worsens the ICERs obtained for more expensive pharmaceuticals. The Finnish PPS is problematic when the aim is to provide Finnish patients with optimal, cost-effective treatments. In its current form, the PPS discourages innovation and comparability of results with other settings, and may prevent reimbursement of otherwise cost-effective treatments.

Keywords: Cost-utility, Incentives, Pharmaceuticals, Price regulation, Reimbursement.