During the first quarter of 2022, the Central Administrative Court of Public Procurement (TACRC) published several resolutions that may be of interest to the biological medicines sector.

Such resolutions address the possibility of favouring biosimilar medicines in tenders (resolution of 27 January) and some issues regarding the INGESA framework agreement (resolutions of 24 February 2022).

Biosimilars may be favoured in tenders

In prior CAPSULAS (23 June 2021) we reported on two cases where tender specifications gave extra points to biosimilars medicines solely because they were biosimilars (20 and 3 extra points respectively). A company participating in the tender appealed against such specifications. While the TACR did not rule on the merits in the first case (because the tender was cancelled by the contracting authority before its resolution), the TACR deemed that the tender specifications of the second case (3 extra points for the biosimilar) were admissible. The TACR considered that granting these extra points was duly justified.

On 27 January 2022, the TACRC issued a decision endorsing again the use of an award criterion that granted 3 extra points to biosimilars.

After this last decision, it can be concluded that, according to a consolidated TACRC doctrine, it is possible to favour biosimilar products (extra points criterion) in public tenders if:

• the extra points criterion is proportionate and does not infringe, by excess, the principles of equality and free competition and

• the contracting authority specifies the grounds for including such extra points criterion (the Court will merely confirm that this justification exists, without assessing its content).

Finally, it is worth mentioning that the tender assessed by the resolution of the TACRC dated 27 January contemplated certain terms that ensured that ongoing treatments with reference biological products could continue without interruption. Such terms included the establishment of specific lots in which biosimilars could not participate. It is uncertain whether, in the absence of such specific provisions, the resolution of the TACRC would have been the same.

Resolutions regarding the INGESA framework agreement

INGESA is the Spanish National Institute of Healthcare Management. In December 2021, it launched a nationwide tender to select companies for the supply of biosimilars to some Spanish public hospitals. This tender resulted in the so-called INGESA Framework Agreement. Such Framework Agreement sets forth the main terms under which regional health authorities adhered to it (and therefore their public hospitals) may purchase biosimilar products included in its scope. INGESA sets a “tendering price” for each product. All companies offering a price equal or below such “tendering price” are selected and classified following a priority order based on price and certain technical characteristics of the product.

The terms of this Framework Agreement have been very controversial. One aspect of the Framework Agreement that has been particularly challenged is its “price revision clause”. Such clause enables INGESA to reduce the supply price of any contract derived from the Framework Agreement if when presenting a proposal for a derived contract, any bidder would offer such product at a price at least 10% lower than the one foreseen in the Framework Agreement. Many companies appealed against such “price revision clause”. According to INGESA this clause was acceptable because it relates to an “unforeseeable situation”.

The appellants first argued that the “price revision clause” would only be admissible in the context of a centralised public procurement of goods; and that the purchase of products through the Framework Agreement is not a centralized public procurement of goods, but a public nationwide tender to determine supply conditions that requires the ulterior formalization of the purchases at a regional (not centralized) level. The TACRC rejects the appellants’ position, and concludes that a framework agreement is a form of centralised procurement and, therefore, the “price revision clause” is admissible.

The appellants also argued that the “price revision clause” violates the general prohibition to modify awarded supply prices (art. 204 of the Public Sector Contracts Law, “LCSP”). The TACRC rejects this claim. According to the TACRC, art. 222(1) LCSP (specifically related to framework agreements) allows the modification of awarded unit prices under certain conditions. According to the TACRC, art. 222(1) LCSP prevails over art. 204 when it comes to framework agreements.

Finally, the appellants argued that the execution of the “price revision clause” may alter the awardees’ priority order. On this subject, the TACRC highlights that this kind of modification of the contract does not necessarily alter the order of priority, as such order is not only based on price, but also on the technical characteristics of the supplies. The TACRC further highlights the importance of communicating the price change to the remaining awardees to enable them to review their offered price downwards. According to the TACRC, it is crucial to give publicity to this change in conditions “so as to encourage competition”.

La entrada Public procurement of biosimilars   aparece primero en Faus Moliner.

The case in hand was initiated following a call for tenders as part of a Framework Agreement (FA) to supply epoetin alfa. Hospira appealed claiming that the definition of the subject of the agreement, which required that in the data sheet epoetin alfa featured as one of the ingredients of the medicinal product offered, represented a barrier to participating in the call for tenders, as it prevented holders of a biosimilar medicinal product (epoetin zeta) from being able to offer their products.

The Administrative Body of Contractual Appeals (OARC) of the Basque Country allowed the appeal as it believed the specifications limited the purpose of the agreement to a product with a specific active ingredient (epoetin alfa) and prevented equivalent products from being submitted, which represented a barrier to participating in the call for tenders. The OARC ordered the production of new specifications that had to included the term “or equivalent” in the definition of the subject of the agreement.

Biosimilars are not equivalents

Osakidetza appealed before the High Court of Justice, claiming that:

i) it is impossible to deduce that two medicinal products are bioequivalent based on the fact that they are biosimilar, they are in the same therapeutic group and they have the same ATC code;

ii) the judgment of the OARC confuses the concepts “bioequivalent medicinal products” and “biosimilar medicinal products”, when they are different figures, classifying epoetin alfa and epoetin zeta as equivalent medicinal products, despite this not being the case.

The judgment of the High Court of Justice upheld the appeal of Osakidetza. The judgment is based on the idea that the contracting body is responsible for drafting and approving the specifications and that in doing so they cannot ever breach the principles of free competition and equality required by European Community law. Based on the foregoing, unless the purpose of the call for tender so requires, the technical specifications cannot mention products linked to a specific source or production or specific procedures that favour or rule out competitors.

However, the Court adds that in this case, the purpose of the procedure was to continue with the supply of epoetin alfa for ongoing treatments; therefore, it was justified that the FA was called with reference to the active ingredient and not the therapeutic indication.

The High Court of Justice adds that the use of the active ingredient’s DOE (Spanish Official Name) in the specifications ensures the correct identification of the medicinal product sent out to tender, improving the accomplishment of the subject of the agreement without undermining the principles of free competition and equality and non-discrimination; and it concludes that the different epoetins are biosimilar medicinal products, but not equivalent medicinal products.

La entrada Purchase of biological medicinal products: reference to the active ingredient is valid for defining batches aparece primero en Faus Moliner.

This case begun when a doctor treating a patient with Parkinson came to the conclusion that, in this specific case, the generic medicinal product which the patient was getting from the pharmacy did not have the same effect as the branded product which the doctor had prescribed. The substitution had been carried out by the pharmacist in a correct legal manner, because the branded product had a price higher than the generic. However, given the circumstances, the doctor encouraged the patient to buy the branded product, which would not be reimbursed, and to file a claim for reimbursement later on.

The Law and individual rights

The Court that analysed this case ruled in favour of the patient, basing the decision on the need to protect his individual rights. According to the Court, what is crucial to resolve this case is not that the pharmacy was obliged to dispatch the generic product due to its lower price; but the fact that the patient had the right to protect his health and to obtain the branded product prescribed by the Neurology Service that was treating him if, in his case, the result obtained with the branded product were better than those obtained with the generic.

According to the Court the protection of the individual right of the patient is contemplated by Article 85 of Law 29/2006 on prescription, dispensation and substitution; because according to this article the principle that must prevail is that the prescription must be made in the most appropriate manner for the benefit of patients.

The Court also recalls that the same law provides that the sustainability of the system must be protected and it envisages that, because of this, the prescription and dispensation of the branded product is possible only if its price is not higher than the one of the generic one. However, according to the judgement, this rule has to be disregarded in the case of non substitutable products, and in order to determine whether a medicinal product is substitutable or not, it is possible and even necessary to take into account the individual situation of each patient. If the condition of a patient treated with a branded product aggravates when he starts being treated with the generic version, the Court says, these products must be considered as non-substitutable at least in the case of the specific patient.

Selection and Substitution of biological products

The ideas expressed in this judgment contribute to the debate on the situation of patients treated with biological medicinal products. For these products, where prescribing by brand name is compulsory, and where identification of the brand and of the batch of the product administered to the patient is required for pharmacovigilance purposes, substitution without the consent of the patient and the prescribing doctor is not only illegal but it also infringes the individual rights of patients recognized in the Constitution. This applies to any type of selecting measure that implies generalizing substitution or that makes the prescribers treat the new patients with a biologic medicinal product to the detriment of another. The doctor’s criterion, and the patient’s right to be informed and to be able to choose from the available alternatives must prevail in all cases, and especially in this one.

La entrada Substitution of medicinal products and individual rights of patients aparece primero en Faus Moliner.