Minister Harney announces further reductions in off-patent drugs prices
The Minister for Health and Children, Mary Harney TD, announced today (Wednesday 15th September, 2010) that agreement has been reached with the Association of Pharmaceutical Manufacturers in Ireland to price reductions of up to 40% for some of the most commonly prescribed off-patent drugs in Ireland.
The price reductions will take effect on 1st October 2010 and are expected to deliver full-year savings of over €25m for the HSE. The Agreement should also result in lower prices for consumers when paying for their drugs and medicines privately.
The Minister reaffirmed her determination to achieve greater value for money in health expenditure. The Department of Health and Children is currently drafting legislation to introduce a system of reference pricing and generic substitution. The new agreement will provide a stable pricing environment for the introduction of that system in 2011.
There are two representative bodies for pharmaceutical companies in Ireland – the Irish Pharmaceutical Healthcare Association (IPHA) and the Association of Pharmaceutical Manufacturers in Ireland (APMI).
Agreement was reached with the Irish Pharmaceutical Healthcare Association (IPHA) in early 2010 to reduce the price of their off-patent drugs by 40%. This is expected to deliver savings to the HSE of €84m in 2010 and full year savings of €94m. This is in addition to savings of €250m over 4 years from 2006 as a result of the original IPHA agreement.
The Agreement with APMI means that the price of their off-patent drugs will be no more than 98% of the price of equivalent IPHA products.
Regulations introduced under the FEMPI Act 2009 in July 2009 are expected to deliver full year savings of €120m as a result of reductions in fees and margins paid to wholesalers and pharmacists.