The business secret vs. a new database with unit prices for medicinal products

The Czech Ministry of Health, working in tandem with the AIFP (Association of Innovative Pharmaceutical Industry), has created a database with unit prices for drug supplies to hospitals under the direct management of the ministry. What are the consequences for drug suppliers?

In recent times, the health ministry has stressed its commitment to transparent and cost-efficient purchases of goods and services by hospitals under the direct management of the ministry – i.e., in particular, faculty clinics. Since September 2018, a directive by the minister has applied without exemption which, among other things, sets reporting rules and rules for the accounting of kickback bonuses. In addition, a database has now been created which contains the actual unit prices of medicinal products supplied to hospitals under direct ministerial management.

The agreements for the supply of medicinal products made with faculty clinics (as well as individual orders for drugs placed under the same) are subject to public disclosure in the contracts register. Many suppliers oppose this disclosure and try to contain the amount of information which is being revealed by labeling the pricing information in the contract as their “business secret”. This makes it impossible for the health ministry to exercise oversight over the way in which the faculty clinics dispose of their funds. The new database, and the information which it contains, are supposed to remedy the problem.

The database is not publicly accessible. Access to the data is restricted to the health ministry, the State Institute for Drug Control, the hospitals under direct management by the ministry, and health insurance companies, and the scope and form of such access is subject to the rules set out in a memorandum of understanding. Because of its specific legal character, this memorandum by which the database has been created cannot bind all drug suppliers. However, under the memorandum, each and every drug supplier (i.e., even those who are not an AIFP association member) is invited to commit to the submission of certain defined data to the database.

From the point of view of drug suppliers, this raises the question of what benefits or drawbacks are associated with (non )participation in the scheme. For the event that a drug supplier decides against assuming this obligation, the health ministry has made a public announcement that it would support faculty clinics in their effort to engage in an active and thorough review of whether pricing data may legitimately labeled as business secret. This “support” by the health ministry will likely take the form of methodological and legal resources aimed at enforcing the full disclosure of unit prices in the contracts register if there is any doubt as to whether the defining criteria for business secrets are met.

Conversely, if drug suppliers agree to supply their data to the new database, the health ministry has vowed to ensure that the unit price will not become public through any other channels, and that it will not be made available to any entities other than those who have access to the said database.

The above-described database has gone live as of 1 February 2019.

Memorandum of understanding on collaboration between the Czech ministry of health and the Association of Innovative Pharmaceutical Industry of 23 November 2018
Health minister’s directive No. 13/2018
Act No. 340/2015 Coll., on special conditions precedent to the effectiveness of certain contracts, the public disclosure of such contracts, and the contracts register (Contracts Register Act)



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