External Reference Pricing Policy of Pharmaceutical Products in Saudi Arabia: Policy Development and Methodological...

To share Saudi Arabia experience in developing external reference pricing (ERP) policy, selection process, and choice of basket of reference countries.

A systematic literature search was conducted in relevant databases to determine methodological considerations and countries selection criteria for conducting ERP. Then, the existing Saudi Arabia national ERP policy was modified based on the identified criteria. The identified criteria were modulated to fit the Saudi context and to address national public health needs. Stakeholders' and experts' opinions were considered in ERP policy adjustment and in basket countries selection.

Literature search revealed 4 important factors to consider in the development of ERP policy that were deemed relevant to Saudi Arabia's context: (1) similar socioeconomic conditions stratified by gross domestic product per capita, purchasing power parity, and manufacturing activities; (2) robust health systems and regulations; (3) pricing policies; and (4) geographic proximity. Before 2021, the initial ERP basket was composed of 30 countries, narrowed to 20 countries in 2021, and finally narrowed to 16 comparable countries based on the developed criteria in 2022.

The revision of the ERP system reduced the complexity of existing procedures. After the implementation of changes, less variability in outcomes was observed, and as a result, Saudi Food and Drug Authority received fewer appeals. The Saudi Arabian experience offers valuable insights for other countries planning to implement or refine ERP procedures. It serves as input for evaluating ERP as a pricing policy and for assessing the impact of policy design on various factors, such as prices and access to medicines.