The state’s bill for medicines is to be cut by €300m thanks to an agreement between the Health Services Executive and pharmacists, it was revealed today.
Tánaiste and Minister for Health Mary Harney said it was an important step in affording the best drugs for patients.
“This agreement will have a major longer term benefit through putting in place more rigorous and cost-effective processes for evaluating drugs prices.
“The savings achieved as a result of this agreement will be used to improve the overall level and and quality of health services provided to patients.”
The agreement, which runs until 2010, was reached after six months of negotiations.
It will see a wider basket of EU countries being used for the pricing of new drugs, medicines coming off-patent and cutting costs for hospitals.
It is widely acknowledged that the national drugs bill, reflecting the experience across Europe, has increased rapidly over the past decade.
The current costs of medicines each year is estimated at €1.8bn and increasing at 14.6% a year.
The HSE estimates that this deal will reduce annual drug price increases to approximately 6%.
Professor Brendan Drumm, HSE chief executive, said the agreement was the best possible outcome for patients.
“This deal represents excellent value for money and the substantial savings that we make will be re-invested in our services,” the professor said.
“I would also like to thank the Department of Health and Children for their support during these negotiations whose outcome has shown the potential for real value for money results within our health service.”
The HSE added that talks are due to begin shortly with representatives of pharmaceutical wholesalers, domestic manufacturers and community pharmacy contractors that are expected to yield further savings.
The Irish Pharmaceutical Union, the representative body for 1,600 community pharmacists across the country, welcomed the cost cuts.
Michael Guckian, IPU president, said: “Patients will benefit from a reduction in the price of medicines, particularly those whose income is marginally above the qualification threshold for a medical card.
“Now that these negotiations have been concluded, we are looking forward to entering into talks with the Department of Health and Children and the HSE so that we can continue to provide a high-quality pharmacy service to patients in all communities.”
Mr Guckian said he hoped the talks would address a number of issues, including low levels of payments for the medical card scheme, implications of any reduction in the level of income for small marginal pharmacies and facilitate the expanding role of the pharmacist to meet the needs of patients.