Speech by Minister Simon Harris at the Healthcare Enterprise Alliance Breakfast Briefing
I am delighted to join you this morning and to have the opportunity to address you on the very important issue of Medicine Spending. Later, I will also outline to you some details on the very important bid that we are making to have the European Medicines Agency relocated to Ireland in the wake of Brexit.
Advances in medicines, particularly in high tech and innovative medicines, have played a key role in improving the overall health of the population. However, this comes at an ever increasing price.
The high tech medicines bill – that is high tech medicines primarily prescribed in hospitals and dispensed through community pharmacies – has increased from €170 million in 2005 to €545 million in 2015 and is estimated to be just over €590 million in 2016.
The primary driver of the cost of new medicines is high tech and expensive biologic medicines. The top two medicines on the high tech drug lists are biologics – and they cost €87 million and €52 million respectively in 2015. The comparative cost in 2010 was €54 million and €42 million. Combined, these medicines were dispensed over 140,000 times in Ireland in 2015; up from 75,000 prescriptions in 2010.
As expenditure on medicines is expected to continue on an upward trajectory in the coming years, it is necessary to consider new ways to ensure patients have access to new medicines but in an affordable manner. Increasing the use of biosimilars offers one such opportunity.
IMS Health, a leading provider of global health information estimated in a report in March 2016 that by 2020, biosimilars have the potential to enter markets for a number of key biologics that have current sales of more than €40 billion. They also estimate that the cumulative potential savings to health systems in the five major European Union markets and the U.S., as a result of the use of biosimilars, could exceed €50 billion in aggregate over the next five years and reach as much as €100 billion.
There is now a real opportunity for Ireland to make significant savings by adopting and increasing the usage of biosimilars. The estimated spend in Ireland on six biologic drugs that are due to lose exclusivity over the next 2-3yrs was approximately €170m in 2015.
Biosimilar medicines can be significantly cheaper than biologic medicines. For example the biosimilar medicine for the originator Enbrel, the second highest spend medicine in Ireland, is 40% cheaper. However, far greater discounts on certain products are achievable. As more and more biosimilars are launched they will have a significant impact on the sustainability of health systems across the world.
Recognising the importance of biosimilar medicines, the 2016 IPHA agreement on the pricing and supply of medicines capitalised on the development of new biosimilars by providing for a 30% reduction on the price of a biologic medicine when a biosimilar is launched in Ireland. The potential saving using this figure alone and based on 2015 figures is over €50 million per annum. This element of the agreement is already delivering significant savings.
That said, I very much appreciate that encouraging biosimilars to launch in Ireland is not solely about reducing the cost of originator biologic medicines. I want to see real price competition with existing biologic medicines and as a system we must be able to capitalise on this so that we can reduce the overall cost of medicines to the State and for patients. We have seen the positive impact that generics have had on the affordability of medicines.
I also acknowledge however, that biosimilars face a challenge and that is the acceptance of these new treatments by healthcare professionals and patients. It was already highlighted earlier this week that although new biosimilars are being introduced in Ireland, they are not necessarily being prescribed. Therefore it is essential that patients and doctors are appropriately informed and have a thorough understanding of biosimilar medicines so that they have the confidence to prescribe them and to take them.
That is just one challenge that this sector faces. A number of policy issues must be examined and the correct policy levers and tools identified in order to increase the usage of biosimilars in the health system.
Interchangeability of Biosimilars
One of the proposed levers considered to increase the use of biosimilar medicines is to allow for interchangeability with biologic medicines. As you are aware, in Ireland, the Health (Pricing and Supply of Medical Goods) Act 2013 specifically excludes biological medicines from the ‘List of Interchangeable Medicinal Products’ that is created and maintained by the Health Products Regulatory Authority (HPRA).
Biosimilar medicines cannot be considered in the same way as generic medicines as they are similar to but not identical to their reference biologic product. Given the variable nature of biologic medicines, it is therefore necessary that the issue of interchangeability is given extensive consideration.
There is no one consistent approach taken across Europe in regard to interchangeability. Some countries prohibit all forms of interchangeability whilst others for example allow some level of interchangeability but only for new patients entering treatment for the first time.
The recent Bill proposed by Deputy Billy Kelleher sought to amend the Health (Pricing and Supply of Medical Goods) Act 2013 to allow for the interchangeability between biologic and biosimilar medicinal goods. I sought the views of the regulatory body in this area, the HPRA and those of Professor Michael Barry of the National Centre for Pharmacoeconomics on that Bill. Both were supportive of the overall intentions of Deputy Kelleher’s Bill but were of the view that changes to the legislation as outlined in the Bill would not actually achieve the policy objective of increasing the usage of biosimilar medicines in the Irish healthcare system.
National Biosimilar Policy – Wider Policy Considerations
So we know there is a number of policy considerations from a regulatory, patient safety and health policy perspective that must be further examined before we seek to make major changes to the legislation that governs this area.
I consider that the best and most appropriate process to consider these should be through the development of a National Biosimilars Policy.
As the regulation of medicines is a highly technical area I very much intend to be guided by the statutory authorities and the clinicians with the necessary expertise in this area. It is my duty as Minister to ensure that the health services we provide are safe for patients, thus it is appropriate that we take the time to fully consider all the impacts of policy proposals.
There are key policy considerations that will need to be examined.
Firstly, we must assess the clinical impact of patients being switched back and forth between a biologic and a biosimilar medicine and the safety, efficacy and the traceability of the medicine in the event of a side-effect where switching has taken place.
There is an increasing amount of published data on the safety and efficacy of switching which will become available over time. As recently as last November, the results of a major study of this in Norway were released and this data will have to be carefully considered.
Secondly, we need to consider whether or not we as a country consider that pharmacy level substitution is appropriate. This will require extensive consideration as to whether or not the prescriber and patient should always be included in any decisions around switching between a biologic and biosimilar medicine.
The HPRA’s published position is that decisions around switching a medicine which a patient receives from a reference to a biosimilar medicine or vice versa, should always involve the prescriber.
Thirdly, the statutory criteria to assess the suitability of a biosimilar medicine for interchangeability will also need to be considered.
Fourthly, and a major area to be examined as I have already highlighted, is the education of healthcare professionals, patients and other stakeholders in relation to biosimilar medicines. I would very much hope that the Healthcare Enterprise Alliance could provide useful views on how this issue might be best addressed.
Work is now underway in my Department to examine the different policies and levers that should be employed in Ireland to support the uptake of biosimilar medicines as they become available.
As this is a new and growing area of expertise, I believe it is only right and proper that we seek to have significant engagement with the regulatory bodies, clinicians and patients alike. It is therefore appropriate that we undertake a consultation process with stakeholders.
A key part of this will involve the development of a consultation paper which my officials will seek to publish in quarter 1 of 2017. This will afford an opportunity for all stakeholders to contribute to the development of the policy and thereby ensuring that the National Biosimilar Policy is successfully implemented.
The National Biosimilars Policy will therefore inform any necessary legislative changes required to the Health (Pricing and Supply of Medical Goods) Act 2013 in order to achieve increased usage of biosimilar medicines in Ireland.
It is anticipated that this work could take up to 12 months to complete.
Increased usage of biosimilar medicines in 2017
Whilst this work is on-going I want to reassure you that we will continue to seek to increase the usage of biosimilar medicines already on the market for high volume, high growth and expensive medicines.
My Department, in conjunction with the HSE and their medicines management programme, are currently exploring mechanisms to encourage more cost-effective prescribing in this area in 2017.
Every additional euro that a consultant saves though prescribing a more cost effective medicine is an extra euro for investment in new and innovative treatments. It can also expand access to a greater range of high tech biologic medicines for more patients and enable patients to have access to these medicines much earlier in their treatment pathway.
To conclude, the development of new biosimilar medicines being brought to market is a very opportune moment for Ireland to capitalise on and to deliver better, more cost-effective use of medicines.
In a time when we are trying to balance the competing objectives of access to new medicines with affordability, there is no doubt that the increased usage of cheaper, biosimilar medicines will go some way to addressing this. It is therefore critical that have the correct levers in place to enable this to happen.
The development of an evidence-informed National Biosimilar Policy will provide clarity and certainty to the health system, industry and patients regarding the use of biosimilars and will ensure that Government remains focused on its commitment to deliver greater value in pharmaceutical spend.
It is incumbent on all stakeholders within the health service, including the pharmaceutical industry, to drive value, reduce costs and ensure that every euro spent achieves the intended objective.
Finally, as I noted earlier I would like to take this opportunity to bring you up to date on Ireland’s bid to relocate the European Medicines Agency from London to Dublin post Brexit.
A move to Dublin would minimise the disruption to the business of the EMA, thus ensuring continued protection of EU citizens and providing reassurance to the industries which it regulates.
In October 2016 the Irish Government agreed that Dublin should be promoted as a suitable new location for the EMA and an interdepartmental/interagency working group chaired by my Department is currently working on a Proposal.
The Group has identified a number of factors which would make Dublin a suitable location. They include:
- Proximity to London and a similar environment which will encourage staff retention thereby keeping disruption to a minimum.
- Proximity to the Irish medicines regulator, the Health Products Regulatory Authority which would be able to provide the scientific specialist support required by the EMA.
- An English language location, which is the working language of the EMA and the pharmaceutical industry.
- A safe pro EU environment with all the amenities a modern city has to offer, including a modern healthcare system, an excellent education system and a proven track record in attracting and retaining a multicultural workforce.
- Excellent air connectivity with London, other EU capitals and internationally
And last but not least:
- The presence of a strong pharmaceutical sector and life sciences sector in Dublin.
A political and diplomatic campaign is also underway. On 23 January I met Professor Guido Rasi, Executive Director at EMA headquarters in London and on Monday last I had discussions with Commissioner Andriukaitis and other key officials in Brussels.
While I will continue to lead the case for Dublin it is important that all stakeholders, including HEA companies, promote the advantages of Dublin as a new location for the EMA, in particular with partners in Europe. I would very much welcome the support of your industry as we seek to bring this key agency to Dublin.
Thank you again for inviting me to attend this important breakfast briefing, I hope the rest of your morning is very informative.
I look forward to continued engagement with the HEA over the coming year and I encourage each and every one of you to participate in the consultation process for the National Biosimilar Policy when it is initiated shortly.