No politician wants to mess with desperate parents who fear for their children's health.

Federal Health Minister Karl Lauterbach (SPD) therefore reacted unusually quickly to the supply bottlenecks for cough syrups, painkillers, fever reducers or cold medicines.

Christian Geinitz

Business correspondent in Berlin

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On Tuesday he presented a key issues paper for a new drug law, which is to become a draft law next week.

The background to the efforts is that in the course of the current wave of respiratory diseases, there is an above-average demand for medicines and only a limited supply.

Because individual supply chains for pharmaceuticals or active ingredients in Europe and in third countries such as China and India do not function properly, because low prices make production unattractive, because many suppliers have disappeared from the market and there are sometimes only one or two producers.

Lauterbach wants to counteract this situation by having health insurance companies pay more for scarce medicines, eliminating fixed prices and discounts, giving preference to European manufacturers and expanding stocks, and allowing pharmacies to sell medicines with the same effect as an alternative or to manufacture them themselves, for example by using make pills juices.

"Radical" change in pricing

"We have overdone it with the economization in the pharmaceutical supply with off-patent drugs," said Lauterbach in Berlin.

In the case of children's medication, the consequences were particularly severe: "It is unacceptable that it is difficult to get fever syrup for your child in Germany that is still available abroad." The pricing of children's medicines will therefore be "changed radically".

If, for example, young patients have to switch to more expensive medicines, the health insurance companies should assume significantly higher costs than before.

Lauterbach is certain that "this will provide more pediatric medicines in the short term."

“The discounter policy has continuously worsened the supply of medicines for decades.

You can't turn it back overnight."

The Federal Institute for Drugs and Medical Devices (BfArM), which has set up an "Advisory Board on Supply Bottlenecks", is aware of such bottlenecks for more than 300 medicines.

The situation is critical for 51 of them with 17 active ingredients;

most are off-patent drugs.

Tense situation in fever juices

The situation is particularly tense with antibiotics, fever syrups for children, including paracetamol and ibuprofen, and cancer drugs such as tamoxifen and folinate.

The BfArM Advisory Board is now compiling a list of medicines that are required to ensure the security of supply for children.

In the future, neither discount agreements nor fixed prices may apply to these preparations.

So far, the health insurance companies have concluded discount agreements with a group of cheap generic manufacturers, so that the pharmacies were only allowed to sell these medicines to the patients insured with the respective health insurance company.

Fixed amounts are maximum prices for reimbursement by health insurers.

If the price is higher, the patient has to pay, if it is 30 percent or more lower, there is no co-payment for the drug in the pharmacy.

According to the key issues paper, the previously frozen prices (price moratorium) will be increased by 50 percent.

This means that the health insurers will cover the additional costs of medicines prescribed by a doctor up to one and a half times the previous fixed amount.

Lauterbach expects this to give patients a greater choice and more money in the system, which could make the production of scarce preparations more interesting for pharmaceutical companies.

The price pressure on the generics market has led to the abandonment of production facilities or to relocation to non-European countries, especially to Asia.

There are complaints that this has resulted in cluster risks and dependencies.

In order to counteract this, health insurance companies will in future have to advertise an additional lot for every discount agreement for oncological drugs and antibiotics, in which the award criterion "share of active ingredient production in the EU" also plays a role in addition to the price.

Drugs for other diseases can also be added later.

In future, discounted products will also have to be contractually stored for several months close to the point of supply.

In the case of fixed prices, the limit for exemption from additional payments will be reduced from 30 to 20 percent.

This would allow patients to opt for slightly more expensive drugs, which should ease the price pressure on manufacturers.

The National Association of Statutory Health Insurance Physicians and the Pro Generika manufacturers' association welcomed Lauterbach's plans.

The Central Association of Statutory Health Insurance was more skeptical.

Increasing the fixed amount by 50 percent "is an impressive Christmas present for pharmaceutical companies," criticized the association.

The pharmacists' association ABDA was open to the innovations, but opposed the payment of only 50 cents if pharmacies have to consult the doctor about medicines that are not available.

"It's really cheeky," the association complained.