Snap Spanish elections throw health reimbursement reform into doubt

Spanish Prime Minister Pedro Sánchez has called a snap general election for 23 July, throwing several significant health reform initiatives into doubt. A general election had not been expected until December, but disastrous results for the ruling Socialist Workers’ Party (PSOE) in May’s local elections prompted Sánchez to go for an “all or nothing” gamble, betting that early elections will deprive the opposition of time to organise possible coalition partners. This freezes the work of the Ministry of Health (MoH), which had been drafting two royal decrees aimed at reforming the public drug reimbursement process in Spain. A draft of these decrees was expected in May, but now are unlikely to be published since parliament has been dissolved for the duration of the campaign period.

Two broad health reform initiatives are affected by the election. The first is the Health System Cohesion and Quality Law, which essentially aims to block the National Health System (SNS) from partnering with private healthcare providers in an effort to create an exclusively public universal health system. This bill faced repeated delays as it made its way through parliament, and has been strongly opposed by the conservative opposition People’s Party (PP). The second initiative is a reform of the existing Law of Guarantees and the Rational Use of Medicines, which aims to improve access to innovative medicines. This reform was essentially on hold as there was already insufficient time in the legislative agenda for its passing; instead, its main provisions were being advanced via the aforementioned royal decrees.

The decrees were expected to include measures to shorten the drug evaluation process with the goal of slashing the time it takes for innovative therapies to hit the Spanish market. The country’s approval-to-reimbursement time is among the worst in the EU and is the slowest out of the five major European markets (5EU), which also include the UK, France, Italy and Germany. The country takes an average of over 600 days from a drug’s approval by the European Commission (EC) to issue reimbursement decisions and also reimburses a smaller number of innovative drugs than its Western European peers. Royal decrees still require a vote in parliament, but circumvent much of the legislative process, saving considerable time. The passing of reimbursement reforms had also been linked to an €8bn ($8.5bn) private investment program that is now at risk of being scrapped. These reforms had been highly anticipated by the pharmaceutical industry, and the freezing of the legislative process is therefore a negative development. While the outcome of the general election in July is far from certain, polls currently suggest that the PSOE will lose the election by a considerable margin. This would kill the Health System Cohesion and Quality Law, which would be positive for the pharmaceutical industry since public-private health partnerships broadly improve access to healthcare and medicines. The fate of either the reform of the Law of Guarantees or the related royal decrees is less clear, as it is possible that a government led by the PP would also seek to pass these measures or similar reforms, given the growing importance of the pharmaceutical sector to Spain’s economy. However, even if the PP did pass such measures, the reforms would be unlikely to materialise in 2023.