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Medicine bills to fall next year under new price plan

THE cost of many widely used drugs for illnesses such as heart disease is due to fall from early next year under a new pricing regime.

The new system will see a common price for groups of drugs which are exactly the same in the way they treat a patient for an illness.

The reference pricing will apply to drugs which are off-patent and can now be produced in generic form at a cheaper cost. The big drug companies and pharmacists warned last night, however, that the new system needed to guard against drug shortages or over-reliance on one supplier.

A list of around 100 drugs that treat a range of conditions such as blood pressure and angina has now been drawn up, but legislation is needed to introduce this new regime, Health Minister Mary Harney said yesterday.

She was speaking at the launch of a report by a group of experts, chaired by Mark Moran, who examined how reference pricing, already in place in other countries, could be introduced here.

A private patient could see their drugs bill fall while the cost to the State would be reduced by nearly €78m across the medical card and other schemes.

Under the system, drug manufacturers that produce the same medicine off patent will compete on cost and a reference price will be arrived at, favouring the cheapest.

It will mostly favour those with chronic long-term conditions but will not apply to cancer or epilepsy drugs. Mr Moran said yesterday that only 18pc of drugs dispensed under the medical card scheme were generic and they accounted for just 11pc of those used by private patients under the Drugs Payment Scheme. This compares with 83pc in the UK.

At the moment, if a doctor prescribes a branded medicine a pharmacist cannot substitute it with a cheaper generic equivalent -- but this will now change.

Generic medicines have the same active ingredient and are made to the same standard as the original branded drug that has come off patent, but they are cheaper than the branded equivalent although they are more expensive here than in other countries.


"The patient will be given a choice under the new system. They can opt for the medicine at the reference price or choose a more expensive equivalent. If they want the more expensive product they pay the difference," he added.

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The level of savings will depend on how drug companies respond and how vigorous competition will be. Products that cost the HSE €300m are due to come off patent in the next three to five years.

The Irish Pharmaceutical Healthcare Association, which represents the makers of branded drugs, warned that if the price was set at the lowest offer it could mean patients were dependent on one supplier with little commitment to the Irish market.

The Irish Pharmacy Union also urged caution and said it would be concerned that reference pricing could lead to medicine shortages.

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