Blue Prescriptions: A Program in Transition

Mari Trommald, Einar Skancke, Arild Bjørndal, Audun Hågå, and Andrew D. Oxman


This report describes collaboration between researchers and policymakers and the use of evidence in the process of evaluating new drugs for health care insurance reimbursement in Norway; drugs thus approved are called "blue prescriptions" because they are written on blue paper. The authors studied five controversial decisions taken in the Ministry of Health and Social Affairs through the review of available documents; through discussions among the authors, who were participants to varying degrees; and through review of earlier drafts of this paper by other participants in the processes described, as well as by the authors of other papers in this report and two external referees. The aim was to gain insight into the decision-making procedure and thereby identify possible areas for improvement toward a more rational and explicit process for setting priorities.

The drug reimbursement program has developed in the light of Norwegian welfare policies and consists of a patchwork of regulations. Changes in the program during the 1990s have aimed at a stricter emphasis on cost-effectiveness, but even so, assessments of drugs have been largely informal, with consultation of external experts occurring only on an ad hoc basis. This somewhat unstructured procedure has created an environment sensitive to lobbying efforts by experts and representatives of the pharmaceutical industry to influence policymakers in the Ministry of Health and Social Affairs and politicians in Parliament, resulting in considerable impact on the decisions made in the examples reviewed.


The Norwegian Health Care System

The Norwegian health care system has developed in the context of welfare policy in Norway, where equality and justice have been highly valued. All individuals should have equal access to a decent standard of living, work, a place to live, and coverage of crucial health and social services independent of where they reside or their economic situation.

Following from this welfare policy, a key feature of the health care system is the predominance of tax-financed public provision. The hospitals and the primary health care system have been financed largely through block grants from the central authorities and contributions or reimbursement from the state-owned National Insurance Scheme. Membership in this program is mandatory and universal, and is financed by compulsory contributions by employees and employers. The National Insurance Scheme covers retirement pensions, disablement benefits, sickness benefits, unemployment benefits, and health care, including drugs.

There is a co-payment by patients for ambulatory care and co-payment for reimbursed drugs. The ceiling for the total co-payment by a patient is 1,450 Norwegian kroner (NOK) ($U.S.160) per year.1 Expenses above this amount (for reimbursed drugs and ambulatory care) are covered by the insurance program.

Overall planning of the Norwegian health care system has been relatively centralized at the federal level, whereas responsibility for providing most services has been transferred to the county (for primary care) and municipality (for secondary care), with the aim of providing necessary services locally even in remote areas. Based on health status indicators, such as perinatal deaths or life expectancy at birth, the Norwegian population is relatively healthy compared to other OECD (Organisation for Economic Co-operation and Development) countries (OECD 1998). The health care system has, nonetheless, faced problems of long waiting lists and shortages of health care professionals for many years. One response to this has been changes toward a more output-based system in which hospitals and physicians are paid according to activity, for example, through introducing the use of Diagnosis-Related Groups (DRGs) in the funding of hospitals. Additional changes are currently being implemented. The current government has proposed restructuring the ownership of hospitals so that each hospital will be an independent unit directly organized under the federal government. Partial capitation is being implemented this year (2001) in primary care, which has been predominantly fee-for-service-based. Under the new system general practitioners will have contracts for a list of patients and must fulfill specified obligations for providing service to listed patients. This reform is, in part, intended to increase the gatekeeping role of general practitioners and reallocate physicians to underserviced areas.

Drug Expenditures in Norway

The Norwegian National Insurance program covers approximately half of all drug expenditures; patients pay directly for one third, and hospitals and nursing homes cover the rest. Based on sales figures, a total of approximately 9 billion NOK ($990 million) was spent on prescription drugs in 1999 in Norway for a population of 4.5 million people. During the last 12 years, reimbursement expenditures have grown at an annual rate of 10 to 13 percent (approximately 8 percent in fixed prices). In 1988 the public drug bill was 2.6 billion NOK ($283 million)—0.4 percent of the gross national product (GNP), or 610 NOK ($67) per capita. In 1998 the amount was 6.7 billion NOK ($739 million—0.6 percent of the GNP, or 1,520 NOK ($167) per capita (Table 1).

There are two main reasons for this growth: increased drug use and increased prescribing of new and more costly drugs. Price increases have not been an important factor behind the increase in drug expenditures.

Several measures to curb the growth in drug expenditures have been launched. In 1992 patient co-payments were raised from 20 to 30 percent of each prescription for people between 16 and 67 years of age. In 1993 a reference price system was introduced, limiting reimbursement to the cost of the cheapest comparable drug available (for example, generic and parallel imports). If a more expensive drug is prescribed, the reimbursement will cover only 70 percent of the cost of the cheapest comparable drug. (The reference price system has been criticized and was ended in January 2001 [Evaluation . . . 2000].)

Despite the growth in drug expenditures, Norway still spends less money on drugs than other OECD countries. Figure 1 shows pharmaceutical consumption in relative values. OECD data demonstrate that in 1997 the United Kingdom spent 6.8 percent of its GNP on health care and 1.1 percent on drugs. The United States spent 13.9 percent of its GNP on health care and 1.4 percent on drugs. Norway, on the other hand, spent 7.5 percent of its GNP on health care and 0.5 percent on drugs. (OECD numbers are slightly different from national data from the Norwegian Board of Health due to different methods of calculation.) Public spending on drugs as a percentage of public health care expenditure in 1997 varied from 6.7 percent in Norway to 20.8 percent in Japan (Figure 2).

Because a large proportion of drug expenditures is covered by blue prescriptions, there is an economic incentive for pharmaceutical companies to add new drugs to the reimbursement list in Norway. The consultation process for decisions about adding new drugs to the reimbursement list has been largely informal. Denials to add new medications to the list have been met with heavy criticism from drug companies via the mass media, specialists, and lobbying of Parliament.


The first drug reimbursement program was launched in 1953. The main aim was to introduce free prescriptions for drugs that were considered important to the public's health, commonly referred to as blue prescriptions. The blue prescription program, along with other existing programs, was later made a part of the National Insurance Scheme, which is overseen by the National Insurance Administration. In 1981 Parliament introduced co-payment by patients; co-payments are currently set at 36 percent of the amount of each prescription, with a limit of 360 NOK ($40) and a ceiling of 1,450 NOK ($160) per year.

Reimbursement is provided only for "long-term" medication for chronic diseases, defined as more than three months' worth of medication per year. In general the reimbursement program does not cover short-term therapy (for example, antibiotics for pneumonia). The social welfare context in which the program has developed has led to a number of "escape" clauses to ensure that social welfare goals, particularly equity, are achieved. There are four main ways in which drugs can be covered (Box 1). Items A and C require that the drug has been approved for reimbursement. Drugs in groups A and C will, when first approved by the authorities, be reimbursed automatically, while drugs in groups B and D require a formal application for each patient.

The National Insurance Administration operates with two lists: one for approved conditions, and a corresponding one of approved groups of drugs. The groups in the drug list are variably defined; in some cases the chemical compounds are clearly specified (e.g., nitrate compounds), while in others the specifications are very broad (e.g., antidepressants). Drugs approved for general reimbursement (group A) must be licensed to treat one of the listed conditions and belong to an approved drug group. More than 90 percent of total reimbursement expenditures arises from group A. If a drug is not licensed for the listed diagnosis or is not on the "positive list" of reimbursed drugs, it can still be approved for reimbursement based on individual applications (group B). Group C is a remnant from a policy established to eliminate communicable (mainly sexually transmitted) diseases and recently has been revised. Group D fulfills the social intentions of the program; there is no need to document the severity or duration of the disease or of a drug's beneficial treatment effect to apply for coverage in this group. The out-of-pocket expenses are much larger for drugs reimbursed in group D than in the other groups.

Procedures for Assessing Blue Prescription Applications

The Medicines Control Authority is responsible for the licensing of drugs, while the National Insurance Administration has had, until recently, responsibility for approving drugs for reimbursement. To obtain marketing authorization for a particular drug a pharmaceutical company must document the efficacy, safety, and manufacturing quality of its product. The Medicines Control Authority assesses this documentation and makes any licensing decision on the basis of data from clinical trials. To obtain authorization, the effect of the drug must be better than or equal to standard treatment or, if there is no established standard, a placebo. After marketing authorization is granted, the pharmaceutical company must apply to the Medicines Control Authority to set a maximum price, which is usually based on the average of the three lowest prices in Germany, United Kingdom, Ireland, the Netherlands, Belgium, Austria, Denmark, Sweden, and Finland. At this stage there is no assessment of the cost-effectiveness of the drug.

Pharmaceutical companies have up to now applied to the National Insurance Administration for inclusion in the reimbursement program, but recently the responsibility for approving the addition of new drugs to the list of reimbursable medications has been transferred to the Medicines Control Authority, which concurrently has changed its name to the Norwegian Medicines Agency. (However, in this report we refer to the Medicines Control Authority throughout, since the recent administrative and name changes occurred after most of the events reported here.) What follows is a description of the roles of the institutions as they have existed until the present.

Along with the application, the pharmaceutical companies usually provide a selection of relevant publications and sometimes an economic analysis. Until recently the National Insurance Administration has made its own evaluation of a given drug in terms of effectiveness and cost to the reimbursement budget, with consideration given as well to juridical and administrative issues. Implicitly, the efficacy should be documented, but no formal procedure for how to do this has been established; nor has there been a requirement for a systematic review of the evidence. When considered necessary, relevant experts have been consulted for advice.

The Medicines Control Authority, while primarily responsible for licensing drugs, was frequently asked for advice; thus, in keeping with a trend toward growing emphasis on cost-effectiveness, the Pharmacoeconomics Unit was established in 1996 to provide economic analyses and information regarding reimbursement. When considering reimbursement for a new drug, this unit compares the price and effect of the drug with alternative treatments from a societal perspective. Drug companies are encouraged to perform health economic analyses and submit them with their reimbursement applications. This will become mandatory in 2002 and is described in a formal guideline. Health economists have collaborated with the Ministry of Health, the pharmaceutical industry, and others to develop the guideline, which focuses mainly on economic issues. When appropriate, the cost-effectiveness of a new drug will also be compared to nondrug treatments.

The aims of these comparisons are to provide reliable estimates of the cost of reimbursement, costs if reimbursement is not provided, and the effects of treatment. In this way increasing efforts are being made to improve the use of research evidence in reimbursement decisions. The price of a drug is set when the substance is licensed; the Medicines Control Authority sets prices according to production costs, prices of similar drugs, and prices in other countries.

Making Decisions on Reimbursement

The National Insurance Administration has the mandate to accept a new drug for reimbursement if the diagnosis the new medication is licensed to treat is listed, and if the drug belongs to one of the groups on the list of reimbursable medications for that diagnosis. The Ministry of Health and Social Affairs must approve changes to both the diagnostic list and the list of approved drug groups. The budgetary costs for reimbursed drugs are supplied according to the running expenses generated by the approved drugs.

A new class of antidepressants, the selective serotonin reuptake inhibitors (SSRIs), generated unexpectedly large budgetary costs after being approved for reimbursement in the "antidepressive drug" group. This initiated a change in practice so that if large budgetary expenses are expected, the Ministry of Health and Social Affairs should be contacted even if there is no need to change the list of conditions or the list of drug groups. The Ministry of Health can then choose to present new drugs to Parliament as an attachment to the next budget proposal, or make the decisions itself.

In summary, the final decisions can be made at three different levels: in the National Insurance Administration, the Ministry of Health or Parliament. As described below, initiatives for adding new drugs to the list have also been proposed by Parliament. This somewhat unclear process is open for drug companies and others to influence members of Parliament and thus bypass the regular evaluations made by the National Insurance Administration.

Stakeholders—for example, the Norwegian Medical Association or patient organizations—are not formally heard in the process. There is no plan to change this, following the shift of administrative responsibility from the National Insurance Administration to the Medicines Control Authority.

Rationale for Changes in the Program

Changes in the blue prescription program were initiated by data showing increasing drug expenditures. Research evidence was not taken into consideration with regard to the effectiveness of alternative strategies to control costs while achieving the aims of the program. The government established a committee in 1995 to evaluate the blue prescription program; its report was published as a white paper (Ministry of Health and Social Affairs 1997a). Consisting of members of institutions and organizations with an interest in the program, the committee was given the mandate to define and specify the overall goals of the reimbursement plan and make recommendations in light of anticipated developments in health care. Although not explicitly stated in the mandate, the increasing cost of the program was clearly an important factor behind the evaluation. The committee was asked not only to consider equitable access to medications, but also to suggest basic principles for setting coverage priorities. Because there is almost no drug industry in Norway, no direct attempt was made to incorporate industrial concerns regarding the development of new drugs.

The committee concluded that the reimbursement program functioned in keeping with its intentions in achieving the basic goals of the Norwegian welfare system. By international comparison, the program was considered very generous from the patient's viewpoint

The committee's recommendations for improvements in the program included changing the principles for setting priorities in health care, which were taken from an earlier government document (Ministry of Health and Social Affairs 1997b). It was suggested that new drugs be prioritized according to the severity of the disease and the cost-effectiveness of the treatment, principles that previously had not been explicitly applied to drug policy. Seriousness of disease had been used as an implicit criterion for adding a chronic illness to the list, and any licensed drug used to treat it had been added to the reimbursement list. The committee recommended that economic evaluations should be performed for new drugs being considered for addition to the list.

The committee also recommended developing a prescription register to monitor and control prescribing practices. It advised strengthening the efforts to implement cost-effective prescribing practice by consulting "professional groups" and computer-based guidelines. Specific recommendations were made to expand the program to include rare diseases and serious short-term diseases not previously listed.

A number of organizations and institutions took part in reviewing the report. There was generally agreement regarding the aims of the program, and most of the report was supported by all who reviewed it. Remarks mainly concerned details of how the program was organized. In the subsequent legislation put forward by the Ministry of Health and Social Affairs based on the report, priority setting was not fully discussed. Parliament recommended a more transparent process for making decisions on reimbursement, but did not state an explicit policy for priority setting. It was suggested that economic evaluation be incorporated in the assessment of new drugs under consideration for addition to the list, but it was stated that these evaluations should be used with caution and that they cannot replace sensible judgment. This view was repeated in Parliament, and some politicians were reluctant to apply a cost-effectiveness approach to these issues (Ministry of Health and Social Affairs 1999–2000). These politicians claimed that decisions should be based on need alone. In the end, cost-effectiveness and the seriousness of a given disease were introduced as criteria for priority setting, but were not explicitly incorporated into subsequent legislation or regulations. Nonetheless, these criteria have been adopted by the National Insurance Administration and the Ministry of Health and Social Affairs, and underlie their recommendations.


The Medicines Control Authority's Pharmacoeconomics Unit has prepared 19 reports since 1998 (Box 2); here we examine decisions regarding two of these drugs and three additional examples. The main focus is on studying the use of research in making decisions about reimbursement rather than on the implementation of such decisions or their effects on patients. The examples included here represent decisions on drugs that were supposed to have large budgetary consequences, have raised public debate following initial rejection, or have induced changes in legislation to control expenditures (as in the case of sildenafil). They are not necessarily representative of drugs that involve small expenditures or that are approved without controversy.

The descriptions are based on a review of documents and written correspondence archived by the Ministry of Health and Social Affairs regarding reimbursement, the revised national budget, the response to the proposed budget from the Social Affairs and Health Committee of Parliament, and discussions among the authors and key informants. As described previously, only a subset of decisions are taken at the level of the Ministry of Health and Social Affairs. The examples described here represent approximately half of the controversial cases recently assessed in the Ministry of Health.

The use of economic analyses in decisions about reimbursement is a recent development in Norway and is evolving rapidly. Consideration of strategies for promoting cost-effective prescribing of reimbursed drugs is even more recent. This has been prompted by recognition that physicians change prescribing practice after new drugs are added to the reimbursement list (based on sales figures from drug companies) and that these changes sometimes are not cost-effective or consistent with the aims of the program.

A number of research units are occasionally consulted by the National Insurance Administration, the Pharmacoeconomics Unit, and the Ministry of Health and Social Affairs. These include the Pharmacotherapy Institute at the University of Oslo, other university-based researchers in Norway, clinicians, international consultants, and the Department of Population Health Sciences at the National Institute of Public Health. These contacts have mainly been made on an "ad hoc" basis. There is no formal collaboration between research groups and the institutions assessing drugs for reimbursement. The primary focus in this paper is on collaboration between policymakers in the Ministry of Health and Social Affairs, the Pharmacoeconomics Unit, and researchers in the Department of Population Health Sciences at the National Institute of Public Health in assessing drug effectiveness and costs. In addition, contacts with researchers (clinicians, statisticians, or others) filed in the Ministry of Health under the cases are reported here.

Lovastatin (Mevacor) for Hypercholesterolemia (1988)

Lovastatin is a cholesterol-lowering drug and was the first statin introduced in Norway. The manufacturer, Merck Sharp & Dome (MSD), applied for reimbursement for Lovastatin on a general basis before its authorization in 1988. The drug was only accepted for reimbursement on an individual basis. In 1989, after the drug had been authorized, a new application was submitted, along with original papers on efficacy and some documentation on cost-effectiveness. Lovastatin was not approved for reimbursement in group A (on a general basis), but was accepted for reimbursement on individual applications for patients with specified risk factors (group B). The National Insurance Administration argued that easy access to these drugs could initiate a broader prescription practice (to patients without risk factors), and would have large budgetary consequences.

In accordance with the recently stated wish to have health economics analysis to support decisions on reimbursement, the National Insurance Administration asked the National Institute of Public Health to perform an economic evaluation of Lovastatin. Before the evaluation was finished, politicians in Parliament raised the issue of adding all cholesterol-lowering drugs to the list of reimbursed medications. Politicians, patient organizations, MSD, and doctors approached the government, asking it to speed up the process of adding these drugs to the reimbursement list.

The National Insurance Administration's final recommendation built on the National Institute of Public Health's report. It concluded that there was a need for restricting the prescriptions rather than loosening things up. Still, the report recommended adding Lovastatin to the list of approved drugs (Box 1, group A) to decrease the administrative burden, since all individual applications at this stage were accepted. It was recommended that the prescription should be limited to patients with three specified risk factors (as suggested in the cost-effectiveness report), and that only specialists should be allowed to prescribe the drug to ensure proper use. The government followed these recommendations. However, a series of appeals made by doctors, pharmacists, and patient organizations resulted in a change in the prescribing regulations, so that today all doctors can renew a prescription for a cholesterol-lowering drug once it has been prescribed initially by a specialist.

Additional statins have since been added to the reimbursement list based on this assessment. After six years, reimbursement for statins has reached approximately 800 million NOK ($90 million) annually and accounts for roughly 20 percent of the blue prescription program. The National Insurance Administration foresaw this situation and repeatedly informed the government that the cholesterol-lowering drugs might be prescribed for a large population of patients, including those with low risk of cardiovascular diseases. This would result in a lower cost-effectiveness ratio and higher total costs.

The strategy used so far to control drug expenditures seems to be based largely on restricting access to drugs. When this fails (as here, due to political pressure), there seem to be few other strategies to ensure appropriate use. This experience has had an important impact on raising awareness of the need for priority setting and economic evaluations as a basis for making decisions about insurance coverage for new drugs. The Ministry of Health and Social Affairs has recognized the large expenditure for statins and antihypertensive medications and the potential to improve the quality of care and reduce costs by implementing evidence-based guidelines for drug management of hypercholesterolemia and hypertension. The ministry has contracted the National Institute of Public Health to develop and implement practice guidelines using interventions tailored to address identified obstacles to cost-effective prescribing of these drugs, and to evaluate the effects of the implementation strategy in a randomized controlled trial. This project will provide a basis for decision making regarding tailored interventions to improve prescribing of these drugs. In addition, it offers a possible model for ongoing collaboration between policymakers and researchers to conduct policy-relevant studies and to help ensure that such research will be used appropriately in policy decisions.

Alendronate (Fosamax) for Osteoporosis and the Prevention of Fractures (1996)

Conflict arose between the Medicines Control Authority and the producer of alendronate (MSD) during the licensing process, prior to consideration of reimbursement. The Medicines Control Authority licensed alendronate with a stricter indication than applied for (established osteoporosis with fractures versus osteoporosis), which led to vehement protest from the producer. This was followed by conflict over price setting. The pricing of drugs was intended to be decided in relation to the treatment effect. The Medicines Control Authority concluded that there was not sufficient proof that alendronate was substantially better than other licensed products (such as didronate), and claimed that the drug should be priced similarly. This led to a price level for alendronate that was substantially below that in all other European countries, which was unacceptable to MSD.

Again MSD protested, and appealed for a new price to be set by the Ministry of Health and Social Affairs. The debate that followed was linked to the evaluation of the effect of alendronate versus didronate in the absence of direct comparisons between the drugs. MSD based its arguments on an economic analysis performed by researchers at the National Institute of Public Health with funding from MSD, while the newly established Pharmacoeconomics Unit performed its own analysis. The Ministry of Health ordered three reports to support their decision: one on costs of osteoporosis in Norway by the National Institute of Public Health; another in the form of a statistical analysis by the University of Oslo; and one from an expert at the National Hospital. In addition, the Medicines Control Authority consulted two external experts.

The producer brought in lawyers at an early stage and exerted pressure on the Medicines Control Authority and the ministry to expand the indication and increase the price. There was extensive argumentation and disagreement about which groups would benefit and the importance of different outcome measures. Members of Parliament were brought into the debate and a number of specialists contacted the ministry requesting a higher price to end the conflict and make the drug available to patients. The phrasing in this letter indicates that MSD prompted contact by these specialists. Parliament instructed the ministry to reject the Medicines Control Authority's recommendation. In addition, the ministry was instructed to add alendronate to the list of approved drugs without a formal application.

The Medicines Control Authority had planned to publish its economic evaluation in its regular journal. MSD responded by suing the Medicines Control Authority to prevent publication of the report. The case was taken to court, and in the end the Medicines Control Authority was allowed to publish the report. Following this, researchers from the National Institute of Public Health (not involved in the earlier economic analysis commissioned by MSD) were requested by the Ministry of Health and Social Affairs to critically review the evidence on the efficacy of alendronate. They reached conclusions similar to those of the Medicines Control Authority and published their assessment in the Journal of the Norwegian Medical Association (Kopjar and Bjørndal 1998). However, this had no influence on the decision-making process for the drug in question, which occurred at a political level and was heavily influenced by lobbying, lawyers, and coverage by the mass media.

Interferon Beta-1b (Betaferon) for Multiple Sclerosis (1997)

Betaferon, which is produced by Schering AG, was assessed several times, beginning prior to its being licensed and ending with an approval more than two years later. The National Insurance Administration and the Medicines Control Authority reached different conclusions about this drug. The Medicines Control Authority conducted an analysis based on its own assessment of published randomized controlled trials and concluded that it was questionable whether this medication demonstrated any clinically important effects.

Despite the seriousness of the disease and the lack of alternative therapies, the Medicines Control Authority did not recommend reimbursement. The National Insurance Administration consulted an expert on multiple sclerosis and asked for his opinion, which was that interferon did have clinically important effects and should be reimbursed. (This expert supplied a number of references.) There are insufficient details in these two reports to determine the basis for the discrepancies (e.g., whether the same studies were interpreted differently, or the conclusions were based on different studies). However, it appears likely that such discrepancies were due largely to different views on the relation of surrogate outcome measures to clinically important outcomes. (Surrogate outcome measures are those that are not of direct practical importance—such as physiological or biochemical markers—but are believed to reflect outcomes that are important. For example, blood pressure is not directly important to patients, but it is often used as an outcome in clinical trials because it is a risk factor for stroke and heart attack.)

The Ministry of Health rejected the application for reimbursement. This was followed by a number of responses from patients, patient organizations, politicians, and doctors and reports in the mass media. Members of Parliament raised the issue of reimbursement for interferon, and asked the government to include this in the revised national budget. The politicians put forward the views of the expert on multiple sclerosis and claimed that there was a need to do more for chronically ill patients in general, and multiple sclerosis patients specifically.

The politicians also argued that it was unreasonable that drugs registered by the Medicines Control Authority for treatment of chronic diseases were not immediately approved for reimbursement. Arguments for this view were that interferon has a statistically significant effect on the progression of the disease and that any effective therapy should be reimbursed without consideration of cost effectiveness.

Following the instructions from Parliament, the Ministry of Health decided to reimburse Betaferon on individual applications by specialists (Box 1, group B). Neither the National Institute of Public Health nor other research institutions were consulted in this assessment.

Sildenafil (Viagra) for Erectile Dysfunction (1998)

Sildenafil was licensed for treatment of erectile dysfunction in November 1998. The producer, Pfizer, never applied to add this drug to the reimbursement list. However, even before it was licensed, the National Insurance Administration received applications from patients asking for coverage for this drug through individual claims for large expenditures not covered by blue prescriptions (Box 1, group D). The Medicines Control Authority conducted an economic analysis of the costs to the reimbursement budget if all patients having this diagnosis applied for individual coverage. This analysis was only a prediction of the number of patients and did not take into account the possible effects, such as improvements in quality of life. Neither the National Institute of Public Health nor other researchers were involved in this assessment.

Based on the assumption that there are 100,000 patients for whom this drug might be useful in Norway, the Medicines Control Authority advised not to cover the expenses of sildenafil through the reimbursement program and specified that it should not be considered for coverage through individual claims. The National Insurance Administration agreed on this conclusion. Although a cost-effectiveness analysis was not performed, it was concluded that the health gain would not outweigh the costs of reimbursement. In response to this recommendation, Pfizer argued that according to the legislation it was not legally possible to exclude any specific drug from coverage. This resulted in a change in the legislation so that the National Insurance Administration could, for "economic or medical reasons," exclude specific drugs from coverage through individual claims for large expenditures.

This was a further restriction of possible ways to cover expensive drugs, driven by concern over massive expenditures from widespread use of sildenafil if it were to be reimbursed. It might have been argued that erectile dysfunction is, generally, not a severe disease and does not qualify for reimbursement on this basis. However, decision making regarding this drug was dominated by concern over the potential costs.

Montelukast (Singulair) for Asthma (1999)

Montelukast, produced by MSD, was licensed in November 1998. The Medicines Control Authority evaluated its efficacy as part of the licensing process, relying primarily on licensure by the European Union, which now is standard. After an application to add montelukast to the reimbursement list, the Pharmacoeconomics Unit conducted an economic analysis. The Medicines Control Authority was reluctant to draw strong conclusions from this, mainly because there was weak background data. Due to the small treatment effect and uncertain role of the drug in managing asthma, the Medicines Control Authority recommended that montelukast should be reimbursed only when the treatment is started by a specialist to ensure correct use. MSD appealed this restriction.

New studies were presented, and MSD claimed that the effect of montelukast was underestimated and that the costs were overestimated. The Medicines Control Authority and the National Insurance Administration critically appraised the new evidence on efficacy and economic data and did not change their previous conclusion. The National Institute of Public Health was asked to make an independent assessment and concluded that the indications should be more rather than less restrictive. There was agreement about the efficacy and the quality of the studies, but there was disagreement about the value of having an alternative to other available treatments that was more expensive and not clearly more effective. In addition, there was disagreement about the importance of equal access, since restricting prescribing to specialists might limit the availability of the drug to patients in rural areas.

The Ministry of Health and Social Affairs proposed to Parliament that reimbursement be restricted based on the effects of the treatment in relation to the costs. MSD and a number of respirologists again approached members of Parliament, questioning the evidence presented by the government and arguing that the experts were not being heard. In addition, patient organizations contacted the Ministry of Health repeatedly, arguing that both the need and the treatment effect were large. The additional information presented was mainly anecdotal experience of doctors and patients. Some of the stakeholders referred to a Nordic consensus guideline that gave montelukast an important role in drug treatment of asthma. In spite of very active engagement by some members of Parliament, the Ministry's recommendation was followed.

Additional studies on the efficacy of montelukast were brought in at almost every stage of the evaluation and appeal process, but assessment of these studies did not bring new information. MSD actively contacted different stakeholders and involved them in lobbying efforts. MSD complained to Parliament about the speed of the process and the confidentiality of documents in the case. One of the most involved respirologists was the principal investigator of one of the montelukast studies and editor of the Nordic consensus report on asthma management to which many of the stakeholders referred.

Montelukast is now reimbursed after individual application, and it has to be prescribed by a specialist. A working group consisting of representatives from the National Insurance Administration, the Medicines Control Authority, the Ministry of Health, the National Institute of Public Health, and respirologists has developed criteria for how this should be practiced. Some respirologists were reluctant to participate in this process due to the consequence it might have for further funding from MSD and potential pressure MSD might put on them.

The group recommended N of 1 trials2 to ensure that patients receiving montelukast benefit from the drug, since a major published study has shown that one-third of the patients do not benefit from treatment. As N of 1 trials have not been used on a large scale before, the group recommended testing this concept on a small scale and comparing patient outcomes and costs with ordinary practice (prescription by a specialist). The report was sent to MSD and the Norwegian Medical Association for comments. They questioned the scientific basis of the report and did not support a linkage between reimbursement and an individual documented effect demonstrated by an N of 1 trial.

Even before this report was finished, articles appeared in the media criticizing the evaluation by the National Institute of Public Health with regard to general reimbursement of montelukast, and Parliament requested a new assessment of the documentation if new evidence was available. This case has not yet been resolved.


The National Insurance Administration is a large administrative organization. The interest in evaluation varies in different departments and depends on the interest of individuals employed at any particular time. The changes in the blue prescription program described above are recent and are still developing. Submission of economic evaluations with applications to add new drugs to the reimbursement list will not become mandatory until 2002. There has not been any external formal evaluation of the use of economic evaluations in the decision-making process or of other changes in the process, with the exception of a review of the reference price system (Evaluation . . . 2000). At this point no formal evaluation has been planned.

Funds for Research and Evaluation

The Pharmacoeconomics Unit of the Medicines Control Authority has limited funds for hiring external consultants on a case-by-case basis (80,000 NOK/$9,000 for 2000). Consultants are contacted in cases that are considered especially important. One problem with using international experts has been that most documentation and reports are written in Norwegian. On the other hand, it can be difficult to find consultants with the appropriate skills and expertise in Norway. Consideration is being given to producing documents and reports in English to allow for more extensive use of international expertise when needed.

The Ministry of Health and Social Affairs does not have funds earmarked for research and evaluation in relation to the blue prescription program, but it does have some general resources available that can be used for this purpose. For example, 2 million NOK ($220,000) was allocated in 2000 to developing effective strategies for improving prescribing of cholesterol-lowering and antihypertensive agents. The National Institute of Public Health does not have any fixed positions allocated for supporting research and evaluation in relation to the blue prescription program, but is able to allocate some staff time to this.

Current Status of the Program

Within the Ministry of Health and Social Affairs the need for prioritizing and using economic evaluations in making decisions about adding new drugs to the reimbursement list is well recognized, and there is firm support for changes in this direction. Currently, efforts are being focused on developing explicit criteria upon which to base such decisions. The Medicines Control Authority has developed guidelines for economic evaluations, but these do not include rules regarding what evidence to include or how to synthesize that evidence; procedural direction of this kind is not specified elsewhere in the existing legislation or regulations. Further, no guiding principles exist on how to deal with differences in opinion and conflicting judgments; nor is there a process for consulting stakeholders, experts, or researchers. Efforts to support interventions to improve rational prescribing for drugs that are already reimbursed, such as cholesterol-lowering and antihypertensive agents, and to ensure appropriate use of new drugs added to the list, such as montelukast, are recent and are limited to a few projects.

The pharmaceutical industry has been highly critical of the application procedures and has complained about the lack of transparency and communication during the process. Most heavily criticized has been the long time spent on assessing applications for general reimbursement, in particular for innovative drugs. The Norwegian Association of Pharmaceutical Manufacturers complained about this to the European Free Trade Association Surveillance Authority (ESA) in 1998. A report made by the association in October 2000 concluded that during the last two years, only 45 percent of the applications met the 90-day standard set by the European Union.



Key factors that limit better use of evidence in making decisions about adding new drugs to the blue prescription program in Norway are


In addition to addressing the factors listed above (for example, by recruiting and training more people), elements facilitating better use of evidence in decision making are

Lessons Learned

Licensure of new drugs in Norway is now based mainly on a common European evaluation. Evaluations and decisions regarding reimbursement are, on the other hand, made at a national level. Changes in the blue prescription program in Norway largely reflect changes in Europe and elsewhere, and have been driven by increasing costs, the need to set priorities, and the evolving role of economic evaluations in informing decisions about insurance coverage. Also as in many other countries, rigorous use of evidence in economic analyses has been limited by a lack of available data and a lack of people with training in clinical epidemiology, health economics, and clinical pharmacology.

The result has been variable quality in the assessments of applications for drug reimbursement. The perceived legitimacy of the assessments also varies among doctors, patient organizations, politicians, and others. In the cases reviewed here, all experts or specialist physicians, no matter how the contacts were initiated, were supportive of the drugs in question. Only one expert stated a conflict of interest.

There are no clearly defined roles for the various stakeholders in the process of making decisions about drug reimbursement. This might result in a general suspicion toward the body assessing applications for reimbursement and lead to the use of alternative channels, such as the media or appealing directly to members of Parliament, to influence the final decisions.

Another important consideration concerns the implementation of decisions once they have been made. Critical statements by experts in the examples reviewed in this report indicate doubts about the legitimacy of some recommendations and decisions. This could inhibit effective implementation, which is necessary in a system where there is little surveillance of physician practice and no clear delegation of responsibility for developing and implementing guidelines for prescribing drugs.

The use of evidence, critical evaluation and economic evaluations now seems to be valued by policymakers and advisers in the Ministry of Health, the Medicines Control Authority, and the National Insurance Administration. Politicians, however, may value these changes less and, in the cases reviewed in this paper, seem to be more influenced by anecdotes, the opinions of specialists, reports in the mass media, and lobbying efforts. In several of the cases described, politicians have played a decisive role in adding new drugs to the reimbursement list.

The Norwegian drug reimbursement program offers the possibility for cost-effective prescribing, targeting "the right drug to the right patient." However, this potential has not been developed because strategies for implementation and control are lacking. A system for collecting national data on prescribing is now under development and will provide information about individual prescribing practices. Two cases presented here—the one involving cholesterol-lowering and antihypertensive drugs, and the one on montelukast—are examples of possible approaches that could be used to promote cost-effective prescribing.

Changes in the bureaucracy have developed slowly over the past five years and have depended on the initiative of a few individuals within the Ministry of Health, the Medicines Control Authority, and the National Insurance Administration. Although the drug reimbursement decision-making process has been criticized in the past for lacking organization and coordination, recent improvements will, it is hoped, provide a more systematic and explicit approach. The examples described here illustrate several challenges. There is still a need to develop a more transparent and explicit process for assessing drug reimbursement applications as well as for ensuring appropriate use of blue prescriptions. In addition, a better understanding by the public and politicians of how priorities in this area are set might improve the perceived legitimacy and acceptance of decisions.


European Free Trade Association

EFTA Surveillance Authority

gross national product

Medicines Control Authority
The government agency responsible for licensing drugs in Norway, more recently given responsibility for providing advice on which drugs should be added to the list of medications that are reimbursed by the National Insurance Adiministration; now called the Norwegian Medicines Agency and given additional responsibilities.

Ministry of Health and Social Affairs
The government department responsible for health and human services; in this report, sometimes abbreviated as Ministry of Health.

Merck Sharp & Dome, a pharmaceutical company

National Insurance Administration
The government agency responsible for administering the public insurance system, which covers retirement pensions, disablement benefits, sickness benefits, unemployment benefits, and health care, including drugs.

Norwegian kroner (crowns), the national currency.

Norwegian Medicines Agency
The new name given in late 2000 to the Medicines Control Authority, along with extended responsibilities.

Organisation for Economic Co-operation and Development

selective serotonin reuptake inhibitors


Evaluation of the Reference-Price System for Drugs [Evaluering av referanseprissystemet for legemidler]. 2000. ECON-rapport 44. Oslo: ECON.

Kopjar, B., and A. Bjørndal. 1998. Prevention of Osteoporosis-Related Fractures with Alendronate. [Forebygging av osteoporoserelaterte brudd med alendronat]. Journal of the Norwegian Medical Association [Tidsskr Nor Lęgeforen]. 118:518–9.

Ministry of Health and Social Affairs [Sosial- og helsedepartementet]. 1997a. Pills, Priority Setting and Politics [Piller, prioritering og politick]. Official Norwegian report [Norges Offentlige Utredninger] 7. Oslo.

Ministry of Health and Social Affairs [Sosial- og helsedepartementet]. 1997b. Priority Setting Again. [Prioritering på ny]. Official Norwegian report [Norges Offentlige Utredninger] 18. Oslo.

Ministry of Health and Social Affairs [Sosial- og helsedepartementet]. 1999–2000. Position paper to the larger division of the Parliament. 52. Oslo: Government Publications.

OECD. 1998. Economic Surveys. Paris: OECD Publications.