The German Advisory Council on Health and Care (SVR) is an independent, interdisciplinary body that provides scientific policy advice to the federal government on matters of healthcare provision. Its primary task is to publish regular reports analyzing medical and economic developments and offering recommendations for the future of the German healthcare system.
On May 22, 2025, the SVR presented its latest report—approximately 200 pages long—entitled “Prices of Innovative Medicines in a Learning Health System” at the Federal Press Conference in Berlin. A central role in preparing the report was played by Prof. Dr. Leonie Sundmacher, head of the Chair of Health Economics. As one of the Council’s seven members, she has for years contributed her expertise in healthcare research and economic evaluation to scientific policy advising.
Compared to other countries, the German healthcare system offers rapid access to new therapies. However, this progress comes at a steep cost. Prof. Sundmacher summarizes: “Spending on pharmaceuticals has risen sharply in recent years. After hospital care, it now represents the second-largest cost category in statutory health insurance, ahead of physician services. In particular, we are seeing increasingly higher prices for the launch of innovative medicines. Fifteen years ago, the average price of a newly introduced patented medicine was around €1,000. Recently, that figure has hovered around €50,000. Against this backdrop, our current report critically examines how prices for innovative medicines are formed.”
The Council warns that the system risks becoming overburdened and calls for medicine prices to be more closely aligned with actual patient benefit—throughout a drug's entire lifecycle. It proposes regular re-evaluations and granting the Federal Joint Committee the right to initiate new price negotiations even without a formal application.
The SVR also criticizes the power imbalance in pricing negotiations: pharmaceutical companies can exit the market at any time, while the National Association of Statutory Health Insurance Funds (GKV-Spitzenverband) is effectively obligated to reach a deal. The Council calls for greater negotiating flexibility for the insurers and a return to reimbursement based only on the cost of the comparator therapy until an agreement is reached.
The Council also questions current industrial policy, arguing that high drug prices are not a decisive factor for investment. Instead, what’s needed are efficient regulatory processes, well-trained personnel, and a modern research data infrastructure. The SVR opposes the proposed link between medicine pricing and location decisions included in the forthcoming Medical Research Act.
The report presents a range of reform proposals, including an annual capped pharmaceutical budget and outcome-based payment models. A “learning health system,” the Council argues, must continuously evolve to ensure both sustainability and access to care.
The full report is available on the SVR website. In celebration of the Council’s 40th anniversary, an expert discussion with stakeholders is scheduled for June 27, 2025.
To the webiste of the Chair of Health Economics
Link to the SVR Report
Contact:
Prof. Dr. Leonie Sundmacher
Chair of Health Economics
TUM Campus im Olympiapark
Am Olympiacampus 11
80809 Munich
Phone: +49 89 289 24464
email: leonie.sundmacher(at)tum.de
Text: Jasmin Schol
Photos: Pixabay/Private