Press Release

Statement by the Minister for Health and Children, Mary Harney TD re Pharmacy services

The first priority for everyone working in health at all times has to be the interest of patients.

In any commercial or industrial dispute in the health sector, patients must come first. When there is a dispute over money, as is the case now, services to patients must continue safely. This has been the norm in the health sector and has been properly followed in almost all disputes.

The situation now is that, overall, medicines continue to be provided to the patients of the country as a whole.

But I am very concerned to hear reports of patients being inconvenienced and facing unfortunate and avoidable delays in the supply of their medicines, due to the withdrawal of services by pharmacists.

I am also concerned to hear of medical card patients being charged for their medicines, in some cases clearly in contravention of the Community Drugs contract.

Patients are entitled to receive their medicines safely and effectively.

Currently, over 1,100 pharmacists are contracted and paid to provide drugs free of charge to medical card patients and to patients covered by the Drugs Payment Scheme over the €100 a month threshold. Many pharmacists are continuing to do so fully.

But where there are instances of the service not continuing in full by pharmacists who are in contract, the HSE must, on behalf of patients, use every possible means, including enforcement through the Courts, to ensure contracts are implemented in full, in every respect.

I assure patients that this will have the Government’s full support. We will not allow contracts made for patients to be ignored or cherry-picked. For pharmacies in contract, there can be no charges for medical card patients or inappropriate closing of pharmacies and refusal to provide medicines under contracted services in a timely way.

The Government has brought in new and strengthened legislation to assure patient safety and professional standards of pharmacy. I have the utmost confidence that the regulator, the Pharmaceutical Society of Ireland, will carry out all its functions fully.

Payment for service – €500m in 2009 after changes

Patients, as taxpayers, are paying for the Community Drugs Schemes.

This year, even after the changes implemented since 1 July, they will pay half a billion euro to 1,600 pharmacies for the community pharmacy service.

Next year, leaving aside any growth in numbers of drugs prescribed, patients, as taxpayers, will be paying approximately €420m for the service.

This is a fair payment from the community of taxpayers and patients for the community services provided by the pharmacy sector.

It brings remuneration of the pharmacy sector back to the levels of 2006. This is in the context of fees having doubled since 2002. In all fairness, and taking account the financial situation of taxpayers as individuals and the State as a whole, this is a reasonable amount to pay for community pharmacy services.

The new payment rates are now set in law. They have been in effect since 1 July. It is done. There will be no policy change, no change in the law to change the payment rates now.

There can be no case now to divert money needed for health services in the autumn back to the pharmacy sector.

And the financial situation of the country simply does not permit us to row back on savings that are now being made.

It is time to move on from the past of pharmacy remuneration to the future.

Developments in next 12 months

Court case: The measures under the Act are to be tested in the High Court in late October by one pharmacy group. These measures were introduced under law and it is therefore entirely appropriate that challenges should be heard properly in the Courts. All sides will keenly await the outcome. In the meantime, patients are entitled to expect services to them to continue as normal.

Discussions on developmental role for pharmacy: There are many community based health services where pharmacists can have a greater role. An on-going process of engagement with pharmacists to develop this would be useful. I am prepared to meet and discuss the future of, and developmental role for, pharmacy services with pharmacists and the Irish Pharmacy Union. However, as the IPU know, pricing issues, past or future, cannot be discussed, since no group of independent contractors may form a common position to set prices for services.

Therefore, mediation not possible: Both because of the clear provisions of competition law and because of the Courts testing the legislation in autumn, the issue is not one for mediation. It is not possible to mediate law, especially as it is to be tested in court. Second, it is not possible for the IPU to develop an agreed pricing strategy in conversation with anyone, mediator or Minister. The Financial Emergency Provisions legislation was developed in this context and is the only process available.

Monitoring of savings: We set about to make a particular level of savings – €55m this year, €133m in a full year – under the Act. I know that some pharmacists fear the impact may be greater. We consulted widely, including with the IPU, and engaged professional experts in making this estimate. Now that the measures have commenced, the actual outturn in savings will be monitored carefully. As would be appropriate in any case, given that there is accountability to the Oireachtas for measures made under law, we will monitor and report the actual savings in a fully transparent way, so that the savings objective as planned is achieved, neither more nor less.

Review of measures: The legislation requires a review of these measures by 30th June 2010 and annually thereafter. I will ensure that this review invites all concerned to make their input in plenty of time on the basis of the actual outturn of the measures. The legislation has been enacted by the Oireachtas fundamentally to deal with the very serious fiscal situation the country faces and that is the purpose that has to be achieved.

Additional savings – generics: Pharmacists will not be alone in adjusting to payment reductions. Other measures to reduce costs in the drugs bill to taxpayers will be advanced this year. For example, we will bring forward a scheme for reference pricing for off-patent (generic) drugs in Ireland. This would mean the State would pay one price for any drug that is off-patent, whether manufactured and sold as a generic or a branded drug. I believe this can achieve significant, predictable cost savings, in a method that is somewhat different to generic substitution of branded drugs. I would look forward to pharmacists’ input on the implementation of reference pricing.

Manufacturers’ prices: The agreement with branded drugs manufacturers (the Irish Pharmaceutical Healthcare Association) runs out in 2010. For the period 2005-2010, savings of €250m will be achieved. We will certainly be looking for more savings from next year and will conduct those discussions also within the constraints of competition law and the fiscal situation.

Given the current situation and these developments, I believe patients are justified in expecting normal community pharmacy services to continue now.

I would appeal therefore to the pharmacy profession to ensure that patients continue to be supplied their medicines in a safe and timely way.

I acknowledge that pharmacists are having to adjust their businesses to the new situation and I know that this can be very challenging.

I want to thank the majority who are continuing to provide services in sometimes difficult circumstances.

The Government also appreciates very much the work of HSE staff at all levels who are working hard to ensure continuity of supply of medicines to patients, particularly at the new HSE pharmacy sites around the country.

Pharmacy has an important and sustainable role as part of integrated community and primary care health services funded by the taxpayer.