U.S. Opens Trade Investigation Into German Drug Pricing

The United States launched a trade investigation against Germany over pharmaceutical pricing on Thursday. U.S. patients to shoulder a larger share of research and development costs.

U.S. Trade Representative, announced the investigation in a statement from his office. He said the United States could consider trade measures up to and including punitive tariffs depending on the findings.

"I am particularly concerned by reports that Germany is fast-tracking legislation that would further reduce spending on innovative medicines," Greer stated. He called on Berlin to enter into talks on pricing. The investigation was preceded by months of talks with the German federal government that did not produce a solution.

Washington has long argued that European healthcare systems benefit from lower drug prices while American consumers pay more for innovation. The probe targets the German federal government's planned health reform. The reform is intended to plug a multibillion-euro gap in the statutory health insurance system and includes additional savings contributions from the pharmaceutical industry.

Under the latest proposals, the pharmaceutical industry is expected to make a financial contribution via a fixed surcharge on the existing manufacturer discount. An earlier version of the reform included a dynamic manufacturer rebate linked to trends in drug prices and health insurers' revenues.

Federal Health Minister Nina Warken proposed exempting companies from additional rebates if they conduct clinical trials in Germany.

The aim is to strengthen Germany as a research location and ensure patients retain rapid access to new therapies. A vote in the Bundestag on the health reform originally scheduled for next week has been postponed. The package is now scheduled for adoption on 10 July, the last sitting day before the summer recess.