OECD statistics are useful for comparing expenditure on medicines and other areas. However, per capita figures are only one of a number of measures that can give a view of drugs spending in Ireland.
The OECD report cited by the Deputy uses data from 2014, the last year for which full figures are available. In 2014, expenditure on prescription and over the counter medicines accounted for just over 14 percent of overall health expenditure in Ireland. Although this was higher than several other EU countries, including Denmark, Finland, and Belgium, it was lower than Germany, France, Italy, and Spain, and significantly lower than Greece or Hungary.
OECD data on pharmaceutical expenditure includes expenditure on both prescription and over the counter medicines but excludes expenditure on pharmaceuticals consumed in hospitals and other health care settings as part of an inpatient or day case treatment. As acknowledged by the OECD "comparability issues exist with regards to the administration and dispensing of pharmaceuticals for outpatients in hospitals."
Looking at expenditure in Ireland alone, the report noted the significant reversal in the growth of pharmaceutical spending in Ireland between 2009 and 2014. There has also been a number of significant developments since 2014 that will further reduce the cost of medicines in Ireland. The Framework Agreement on the Pricing and Supply of Medicines will reduce the price of medicines to the average of 14 other countries and provides for an annual downward only price realignment. This will ensure that Irish medicine prices continue to reduce in line with price reductions across reference countries. This Agreement is expected to deliver savings of up to €750 million over the next four years.
Other initiatives will continue to be pursued, to ensure that we achieve affordable prices for medicines for both patients and the State including the HSE's Medicines Management Programme, which has a particular focus on cost-effective prescribing, and the continued implementation of generic substitution and reference pricing.
In relation to Orkambi, the HSE has statutory responsibility for decisions on pricing and reimbursement of medicines under the community drugs schemes, in accordance with the Health (Pricing and Supply of Medical Goods) Act 2013.
I am informed that, following a request from the HSE, the NCPE carried out an assessment of the manufacturer's economic dossier submitted in March 2016 on the cost effectiveness of Orkambi. This dossier included details on all relevant costs and relevant cost offsets including those associated with hospitalisation, disease management costs, intravenous antibiotics, adverse events and any additional costs arising in patients not taking Orkambi.
The NCPE has completed its Health Technology Assessment and this is available on its website. It was submitted to the HSE in June 2016. The NCPE determined, following an evaluation of the economic dossier, that the manufacturer failed to demonstrate cost-effectiveness or value for money from using the drug. The NCPE have confirmed that all relevant costs were included in the analysis.
The HSE has recently completed its most recent round of negotiations with the manufacturer. On foot of this, the HSE’s Drugs Committee, having considered the NCPE recommendation and other expert advice, is in the process of sending its latest recommendation on the cost-effectiveness of Orkambi to the HSE Directorate. The HSE Directorate will then make a decision taking into consideration the manufacturers' latest price offer. This decision will be made on objective, scientific and economic grounds in line with the 2013 Act.
I share the HSE's disappointment that the manufacturer in this case has maintained a very high price in the course of negotiations in relation to the potential reimbursement of Orkambi for Irish patients.
I appreciate that this is a very stressful time for Cystic Fibrosis patients and their families. However, I want to assure them that I do not consider this to be the end of the process. I would strongly urge Vertex, as the manufacturer in this case, to fundamentally reconsider its position and to table a pricing proposal which can facilitate the provision of Orkambi at a price that will represent value for money for the Irish health service, patients and the taxpayer.
