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Drugs makers warn Varadkar they won't back down on prices


Leo Varadkar, TD, Minister for Health

Leo Varadkar, TD, Minister for Health

Leo Varadkar, TD, Minister for Health

DRUGS companies yesterday warned that they will not back down and reduce the prices of medicines - despite a warning by Health Minister Leo Varadkar that he may invoke legislation that would force them to do so.

Mr Varadkar said he wants to see the pharmaceutical giants cutting the prices of their patented drugs. But if the industry fails to cooperate, he will consider using his powers under law to impose the reductions.

These powers, which are part of relatively recent legislation, have never been called on.

"The minister is keen to do this in cooperation with the industry," Mr Varadkar's spokesman said.

"Should this not prove possible, all alternatives - including the use of provisions of existing legislation - will have to be considered."

But Oliver O'Connor of the Irish Pharmaceutical Healthcare Association (IPHA) said there can be no price cuts until a three-year deal on costs with the Department of Health has run its course.

Mr Varadkar wants the drugs companies, as part of a "mid-term review" of the agreement, to include cuts in the price of patent drugs on the agenda.

The three-year deal, worked out in late 2012, meant the drug companies supplying state schemes here agreed to cuts with a target saving of €400m, mostly by patients using more generic and non-patented drugs.


Mr O'Connor stressed that drugs companies had already incorporated the secure prices set for three years in Ireland into their business plans.

Irish-patented drug prices were benchmarked against the average price in nine European countries when the deal was done in 2012.

Mr O'Connor said the prices here remain at or near this average.

However, the Department of Health said some drugs prices have fallen considerably in a number of these countries.

They want to know why the same cuts have not been applied here.

In 2012, officials tried to have the price of drugs in Ireland reduced to the lowest of the basket of nine countries, but the drugs companies objected.

Mr O'Connor said they would welcome a meeting with the minister and hoped to continue the dialogue. He refused to say what action the industry might take if the legislation was invoked.

Among the most expensive new drugs which the HSE is under pressure to provide for patients with rare disorders is Soliris, which costs €437,000 a year. Its maker, Alexion, is not a member of the IPHA.