MARKET PLACE
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In 2006, there are more than 500 medical device and in vitro diagnostic (IVD) companies in Italy; this figure is made up of manufacturers, commercial branches of multinational companies and national distributors. They employ approximately 30000 people and have an overall turnover of approximately €7 billion. Italy is the third largest market in Europe after Germany and France. Approximately 20% of the total turnover is generated by manufacturers with production located in Italy; this equates to 40% of the total number of companies (Figure 1). The industry is characterised by small to medium-sized companies; more than 70% of companies have a turnover of less than €20 million (Figure 2).
Operating scenario
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Figure 1. (click to enlarge) Profile of Italy's medical device industry. (Source: Assobiomedica, 2006) |
The medical device industry has to operate in a highly complex health-care system that is organised on three levels:
National. Central government is in charge of political planning, regulation and medical vigilance. The central power is represented by the Ministry of Health (MoH), which oversees the Regional Health Authorities (RHAs) and regional legislation.
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Figure 2. (click to enlarge) Companies operating in Italy by size of turnover. |
Regional. Twenty-one RHAs form the main administrative body. They provide the framework for the provision of health services in the regions. They draft regional health plans and evaluate the efficiency of the local health services on the basis of standard levels of care set at the national level. The RHAs are responsible for managing the reimbursement systems.
Local. Local organisations operate health-care programmes, facilities and services. Hospital structures depend on local health authorities, except for the autonomous hospitals, which operate as independent companies and have proper legal status in each region.
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Figure 3. (click to enlarge) Health-care expenditure and financing in Italy. (Source: Ministry of Economics and Finance) |
The main problem that medical device companies have to face in this scenario is that the Italian national health service has been consciously and markedly underfinanced for many years and yearly deficits are paid slowly and partially (Figure 3). This delay of payments gives rise to stressful relationships between the public administration and suppliers. Figure 4 shows the trend in outstanding payments from January 2000 to May 2006, according to data collected by Assobiomedica from 37 companies; the payment terms have progressively increased, reaching almost 350 days in 2006.
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Figure 4. (click to enlarge) Number of outstanding days for payment. (Source: Assobiomedica, 2006) |
In May 2006 the new Government took power and a significant debate has begun between the Government and the regions on how to deal with the financial gap that has opened up. But, in view of the financial situation in Italy, a solution seems remote.
Stronger enforcement actions
After reorganisation in 2004 of the Medical Device Directorate General (www.ministerosalute.it) within the Italian MoH, which is the Italian Competent Authority for the three medical device Directives, important actions have been taken.
There has been a remarkable enforcement of vigilance and postmarketing surveillance. In particular, with the agreement between MoH and the Istituto Superiore di Sanità (ISS) (www.iss.it) on surveillance activities, a huge number of manufacturers and companies have been visited (more than 830 visits) by trainee ad-hoc supervisors. Other outcomes of the agreement are the provision by ISS of technical support on vigilance, clinical investigations and education and training activities for health-care workers involved in the management of medical devices. Related to this, the MoH has established new internal procedures for submission of clinical-investigation requests by manufacturers and for incident reporting by manufacturers and health-care workers.
Finally, it is important to note that, whereas in other European countries the problem still remains unresolved, the Italian MoH decided in 2005 to take a strong position on sterilisation, regeneration and reuse of single-use medical devices. It judges these procedures to be “not consistent with the Italian regulatory framework.”
Reimbursement changes on the way
Reimbursement issues are the responsibility of the RHAs using three tools:
• a diagnosis related group (DRG) system for hospital services (normal admissions and day hospital)
• a positive list for outpatient services (IVD tests included)
• a list of medical devices that are to be supplied to end-users such as ostomy devices and hearing aids.
The freedom enjoyed by the RHAs regarding reimbursement management has produced during the past 10 years a huge variability from region to region. Each region is able to define its own DRG coding and grouping system. This increases the differences not only in the tariffs, but also in how a service or a procedure is codified by the system.
Starting in 2005, the MoH has been trying to harmonise the different systems that exist among the regions. In 2006, an agreement between MoH and the RHAs states that the regions will adopt the same version of ICD-9-CM (for the classification of procedures) and DRG rules. A National Commission will check and, if necessary update, every two years the coding and grouping rules. Moreover, before the end of 2006, the MoH, in conjunction with the RHAs, will publish an updated positive list of IVD tests and outpatient services.
With the Financial Law of 2006, a focus has been placed on medical devices supplied to end-users, together with enforcement of territorial care and a growing attention to the patients’ needs. A new positive list for ostomy devices, advanced wound care, incontinence pads and urinary catheters is in development. The MoH has actively involved industry in this project, however a realistic deadline has yet to be defined.
Information supplied by Assobiomedica, the Italian medical device and in vitro diagnostics association, via Giovanni da Procida 11, I-20149, Milan, Italy, tel. +39 02 3453 1165, e-mail: assobiomedica@assobiomedica.it, www.assobiomedica.it.
