Dáil Éireann debate -
Tuesday, 12 Feb 2002

Vol. 548 No. 2

Written Answers. - Drug Costs.

Gay Mitchell

Question:

259 Mr. G. Mitchell asked the Minister for Health and Children the role he has in determining the cost of drugs sold through pharmacies here; if he uses the United Kingdom price and a mark-up; and if he will make a statement on the matter. [4646/02]

Minister for Health and Children (Mr. Martin)

The price of drugs and medicines – ex manufacture – in Ireland has been subject to control since 1972 through the mechanism of formal multi-annual agreements with the Irish Pharmaceutical Healthcare Association, IPHA, formerly the Federation of Irish Chemical Industries, FICI, which provides that the maximum price to the wholesaler of any new item of reimbursable medicine introduced to the market and covered by the agreement shall not, on the date of notification, exceed the currency adjusted UK wholesale price or the average of a basket of EU countries, whichever is the lower. A price freeze is also in place in regard to the prices charged for existing products. The current agreement has been extended to mid-2005.

Under the general medical services scheme, pharmacists are reimbursed the trade price of the drug plus a dispensing fee. In the case of prescriptions reimbursed under the drug payment scheme, the cost reimbursed by the State covers the ingredient cost of the medicine, the retail mark-up on the ingredient cost, normally 50% of the trade price, and a standard dispensing fee. My Department has no function in relation to the retail mark-up on private dispensing, which has been established by custom and practice over the years.

In addition, persons suffering from any of the following conditions, who are not already medical card holders, may obtain without charge drugs and medicines for the treatment of that condition under the long-term illness scheme: mental handicap, mental illness for persons under 16 years only, phenylketonuria, cystic fibrosis, spina bifida, hydrocephalus, diabetes mellitus, diabetes insipidus, haemophilia, cerebral palsy, epilepsy, multiple sclerosis, muscular dystrophies, parkinsonism and acute leukaemia. The cost reimbursed by the State covers the ingredient cost of the medicine, the retail mark-up on the ingredient cost, normally 50% of the trade price, and a standard dispensing fee.

Developments in biotechnology and therapeutics have given rise to the introduction of medicines for the treatment of medicinal conditions, many of which previously had either no effective treatment or required extended in-patient hospital care. Heretofore, these medicines were supplied in the main by hospitals or health boards. To improve service to persons who require these drugs, agreement was reached with community pharmacists on arrangements for the dispensing and use of these highly complex medicines. This arrangement, known as the high tech scheme, improves patient care and brings about greater control of these expensive and essential medicines. A capitation payment per patient per month is paid to community pharmacists in respect of this scheme.