HSE targets €110m cut in drugs’ bill - Drug cost savings

The announcement that the HSE is to try to shave €110m from its drugs’ bill this year by renegotiating prices with drug companies is very welcome, even if the proposal has an all-too-familiar ring to it — and even if such very welcome savings would fall well short of 10% of the estimated €1.7bn spent by the Government on drugs last year.

A second announcement, that the HSE is almost €60m over budget for the first two months of the year, and that that overspending may hit €350m for the full year, adds urgency to negotiations around drug prices. The overrun of €58.4m was driven by overspending of €48.8m in hospitals and €8.8m in social care. An overspend of €350m seems to show a savings target of €110m in a poor enough light, even if realising it remains a considerable challenge.

It is expected that the HSE may invoke legislation because savings offered during negotiations between the Department of Health, the Department of Public Expenditure and Reform and the pharmaceutical industry, which began in March, have been deemed inadequate.