Dáil Éireann Debate, Thursday - 27 June 2013
278. Deputy Caoimhghín Ó Caoláin asked the Minister for Health if he will detail the most recent Irish Pharmaceutical Healthcare Association and Association of Pharmaceutical Manufacturers in Ireland agreements in relation to the supply of drugs to the State; the savings expected from these deals in 2013 and subsequent years; and if he will make a statement on the matter. [31427/13]
View answerFollowing intensive negotiations involving the Irish Pharmaceutical Healthcare Association (IPHA), the HSE and the Department of Health, a major new deal on the cost of drugs in the State was concluded in October last. It will deliver a number of important benefits, including:
- significant reductions for patients in the cost of drugs;
- a lowering of the drugs bill to the State;
- timely access for patients to new cutting-edge drugs for certain conditions; and
- reducing the cost base of the health system into the future.
The IPHA agreement provides that prices are referenced to the currency adjusted average price to wholesaler in the nominated EU member states in which the medicine is then available. The prices of a range of medicines were reduced on 1 November and further price reductions were implemented on 1 January 2013 in accordance with the agreement.
The gross savings arising from this deal will be in excess of €400m over 3 years. €210 million from the gross savings will make available new drugs to patients over 3 years. Thus, the deal will result in a net reduction in the HSE expenditure on drugs of about €190m.
The Department of Health and the HSE also successfully finalised discussions with the Association of Pharmaceutical Manufacturers in Ireland (APMI), which represents the generic industry, on a new agreement to deliver further savings in the cost of generic drugs. Under this Agreement, since 1 November 2012, the HSE only reimburses generic products which have been priced at 50% or less of the initial price of an originator medicine. In the event that an originator medicine is priced at less than 50% of its initial price the HSE requires a generic medicine to be priced below the originator price. This represents a significant structural change in generic drug pricing and should lead to an increase in the generic prescribing rate.
It is estimated that the combined gross savings from the IPHA and APMI deals will be in excess of €120 million in 2013.
