Dáil Éireann Debate, Tuesday - 18 October 2016
53. Deputy Gino Kenny asked the Minister for Health the efforts he is making to secure cost-effective prescribing, pricing and payment systems; the reason the cost of drugs here is greater than in comparable countries; and if he will make a statement on the matter. [30692/16]
Amharc ar fhreagraThe State has introduced a series of reforms in recent years to reduce pharmaceutical prices and expenditure.
A new four-year Framework Agreement on the Supply and Pricing of Medicines was signed in July 2016 with the Irish Pharmaceutical Healthcare Association (IPHA) which is expected to deliver approximately €600 million in savings over the lifetime of the Agreement. The principles captured in the Agreement will also be extended to non-IPHA suppliers of branded medicines, leading to additional expected savings in the region of €150 million.
The new Agreement contains a number of features which represent clear additional value over the terms of the previous 2012 Agreement. The reference basket of countries used to set prices in Ireland has been expanded from 9 to 14 countries and, importantly, includes lower cost countries. For the first time, the Agreement provides for an annual price realignment, which will ensure that the prices of medicines in Ireland reduce in line with price reductions across the reference countries. This will ensure the State achieves better value for money on the cost of medicines as prices in other basket countries are adjusted downwards over time. In addition, the Agreement secured a 30% reduction in the price of biologic medicines when a biosimilar medicine enters the market.
Another important initiative is the on-going implementation of generic substitution and reference pricing. To date 47 substances have been included in this process and I have recently requested that the Health Products Regulatory Authority review an additional 15 substances. The implementation of generic substitution and reference pricing delivered €47m in savings in 2014 and €94m in savings in 2015.
My Department and the HSE are committed to driving further efficiencies and savings on the cost of medicines for the State. Establishing a new Community Pharmacy, Dental, Optical and Aural Policy unit in the Department is bringing a renewed focus to the development of policy in relation to community pharmacy and the issues associated with achieving maximum benefit to patients.
The HSE has also recently established a Drugs Management Portfolio, which includes a range of projects to optimise value in the primary care and hospital settings. The Portfolio also includes the work of the HSE's Medicines Management Programme which introduced the preferred drugs initiative to facilitate more cost-effective prescribing particularly in relation to high-cost medicines. It continues to engage with general practitioners to reinforce the message around safe, effective and cost-effective prescribing including generic prescribing.
It is also important to point out that the prices of medicines vary between countries for a number of reasons, including different prices set by manufacturers, different wholesale and pharmacy mark-ups, different dispensing fees and different rates of VAT.
