Committee told price cuts causing medicine shortage

A medicine shortage caused by excessive drug price cuts imposed by the HSE is having a negative impact on patient care, an Oireachtas committee heard yesterday.

The Association of Pharmacutical Manufacturers of Ireland, which represents generic drug producers, is concerned the health authority’s pricing system is acting as a disincentive.

Since 2013, the HSE has set a reference price that it pays for a group of interchangeable medicines. Over the last five years, the use of generic drugs has more than doubled from 18.5% to 48%, according to the IAPM

The association’s president, Martin Gallagher, said for a small country like Ireland reference pricing did not work for low volume off-patent medicines. He told a meeting of the Oireachtas Health and Children Committee that generic companies were being put off from launching medicines because it was uneconomic.

He said “excessive lowering” of reference prices for the size of the market has and would lead to more generic companies ceasing to make drugs available.

The Irish Pharmacy Union said Ireland would never have the lowest price for prescription medicines because it would result in shortages.

IPU president Kathy Maher said pharmacists were “justifiably”concerned that constantly falling prices might worsen existing medicines shortages. Such a development would have a negative impact on their patient’s treatment, she said.

Ms Maher said prices for many off-patent medicines had fallen by as much as 85% in the last 12 months.

Irish Pharmaceutical Healthcare Association president Dr Leisha Daly said, under the current agreement, Irish prices were set at the average in nine EU member states.

Dr Daly referred to a recent study showing patent-protected medicines were within the 1.8% of the average of the nine countries.

She said member companies had to offer new medicines to the HSE at a price which was at, or lower than, the average of its price in the member states.

Teva Pharmaceuticals Ireland, the largest supplier of prescription medicines in the country, outlined how the State could save an extra €113m a year.

General manager Sandra Gannon said savings could be achieved through legislative reform, enhanced procurement practices at hospitals, and negotiations with the healthcare community.

Meanwhile, chairman Jerry Buttimer expressed disappointment at the refusal of Alexion Pharmaceuticals to appear before the committee.

The US-based company, which employs 150 people in Ireland, manufactures Eculizumab under the brand name, Soliris, one of the world’s most expensive drugs, at around €430,000 per patient per year.

The committee’s invitation has been re-issued to the company.