Expert flags ‘warning signs’ for German pharma industry
Germany’s pharmaceutical industry faces fundamental challenges, as the cancellation of planned investments by giants Eli Lilly and Boehringer Ingelheim shows, an expert at the Cologne Institute for Economic Research (IW) has warned.
“My assessment at this point would be that we are experiencing clear warning shots,” pharma expert Jasmina Kirchhoff told dpa. This must be “taken seriously, because these are considerations that many other companies will also be making.”
On Wednesday, Boehringer Ingelheim announced that it would not invest €900 million ($1.04 billion) earmarked for the years 2027 to 2030 in its German sites. Shortly afterwards, US company Eli Lilly announced it would invest only half of the planned $2.5 billion in its new plant in Alzey, Rhineland-Palatinate.
Kirchhoff cited German healthcare reform plans as an issue. Statutory health insurance contributions were being debated at a time when global conditions are changing, she said, noting that the US market was undergoing a complete restructuring and pressure from Asia was increasing.
The expert said the pharmaceutical industry is critical of dynamic manufacturer discounts – legally prescribed reductions in drug prices that can change according to circumstances – being proposed by the German government as part of savings measures.
“With those, it is practically impossible to carry out any planning at all, because these discounts change every year,” Kirchhoff said. “Moreover, the assumption has to be that in future they will only increase.”
In addition, she pointed to existing legislation that provides for the possibility of rebates on innovative medicines, arguing that this undermined the protection of intellectual property.
She noted that some countries had already raised their healthcare budgets in response to US pharmaceutical policy. “What we are doing is the exact opposite.”
