Dáil Éireann Debate, Thursday - 10 April 2014
198. Deputy Billy Kelleher asked the Minister for Health the savings in the medicines budget realised by his Department in each of the years 2011, 2012 and 2013, respectively; the projected savings in 2014 as result of agreements negotiated with the pharmaceutical industry, both branded and generic manufactures; and if he will make a statement on the matter. [17150/14]
View answerThere has been ongoing engagement with the Irish Pharmaceutical Healthcare Association (IPHA) and the Association of Pharmaceutical Manufacturers in Ireland (APMI), the representative bodies for the proprietary and generic manufacturers respectively, in recent years which have achieved significant reductions in the prices paid for medicinal products by the State. Agreements concluded with IPHA and APMI in 2006 generated total savings in the region of €250 million. Agreements on further price reductions implemented between 2010 and 2011 generated in the region of a further €250 million in savings.
In June 2012, an interim agreement with the IPHA delivered further price reductions to the prices of certain off-patent medicines which generated approximately €16 million in 2012.
In October 2012, a major new deal on the cost of originator drugs was concluded with the IPHA which 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 gross savings arising from this deal will be in excess of €400 million over 3 years. €210 million from the gross savings will be available to fund new drugs.
A new agreement was also reached with the APMI in October 2012. Since 1 November 2012, the maximum price the HSE pays for generic products is 50% of the initial price of an originator medicine. Recent negotiations with the APMI have resulted in agreement on additional price reductions and, from 1 May 2014, the maximum price the HSE will pay will be 40% of the initial price of an originator medicine. This will result in the price differential between off-patent drugs and most generic equivalents increasing from 5% currently to approximately 20%.
The combined gross savings from the IPHA and the APMI agreements were in excess of €120 million in 2013 with an additional €28 million saved in 2014.
