Generic drug prices three times dearer here

The cost of generic medicines in Ireland is almost three times that in the UK, according to a major new study of international drug prices.

Commonly used generics, which are copies of branded drugs which have come off patent, cost more in Ireland than in any of the other nine European countries with which Ireland is traditionally bracketed for price purposes, the study by US healthcare consultants shows.

Generic medicines cost 123 per cent more in Ireland than in the Netherlands, 63 per cent more than in Germany, and 55 per cent more than in Denmark.

They cost 26 per cent more than in the next most expensive country, Spain.

The Government could save €70 million a year if the price of generic medicines fell to the average of neighbouring European countries, the research by IMS Healthcare finds.

The actual price differential on generic drugs for Irish consumers is probably even higher than revealed in the study as it measures ex-factory prices before wholesalers and pharmacists add their mark-ups.

The results of the study are likely to increase pressure on the Government to force a reduction of drug prices here, as demanded by the troika overseeing Ireland’s debts.

The Economic and Social Research Institute is due to publish its analysis of Irish medicine costs vis-a-vis other countries shortly.

The study is based on the ex-factory price of medicines last January in 18 European countries and was commissioned by the Irish Pharmaceutical Healthcare Association (IPHA), which represents the manufacturers of branded medicines. The top 200 substances in each market were examined, accounting for up to 99 per cent of total spending on medicines. While previous surveys have revealed large disparities in drug price between Ireland and other markets, most were based on a small range of products and some used older price data.

The latest study was carried out last January after the Department of Health finalised two new agreements with branded drug manufacturers and generic drug-makers.

It appears to show that in the generic sector Minister for Health James Reilly’s efforts to cut prices have so far borne little fruit.

The State spends almost €2 billion a year on drugs provided under a variety of schemes.

For drugs which are still on patent, the study shows that Irish prices, while third dearest of 10 countries, are virtually the same as the average of a basket of prices. Only Germany and Denmark had higher prices. Comparisons with other countries in southern and eastern Europe also revealed that branded drug prices are broadly the same in Ireland as the international average.

The IPHA says this shows that Ireland is not an “outlier” in comparison to other countries with similar healthcare systems and national incomes.

“The fact that the Irish index is in line with the index in the other basket countries demonstrates that our external reference pricing model is effective in calculating fair prices for the Irish market, which are neither too high nor too low and serve to ensure continuity of supply of products for Irish patients.”

For off-patent drugs, Ireland was the second dearest of 19 countries after Switzerland.