Irish medicines up to 24 times dearer than in New Zealand

Commonly used medicines cost up to 24 times more in Ireland than they do in New Zealand, according to a report commissioned by the Department of Health.

The report compared the prices of the top 10 drugs used in the medical card schemes in Ireland with prices in New Zealand and found that only one was slightly cheaper in Ireland.

Olanzapine, sold as Zyprexa and used to treat schizophrenia, is almost 24 times more expensive. Omeprazole (Prilosec), which is prescribed for ulcers and dyspepsia, is 18 times dearer. Clopidogrel (Plavix), which is used to prevent heart attacks and strokes, costs almost 12 times more in Ireland.

Drug manufacturers often argue that one of the reasons costs are higher in Ireland is because it is a small country with limited economies of scale compared to the UK and other big markets. However, the authors of this report by the European Observatory on Health Systems and Policies chose to compare prices with New Zealand because the two countries are of a similar size.

Some Irish drug prices have since dropped after a deal was agreed with pharmaceutical companies last month.

The report is critical of user charges in health and points out that Ireland already has very high charges. It costs €51 on average to visit a GP here compared to €22 in France.

Ireland is one of only three countries to charge “non-poor” households for essential prescription drugs and one of only six to charge for attending hospital emergency departments. It says the hospital charge is much higher than elsewhere – €100 compared to only €2-€30 in other countries that charge.

Ireland is the only EU health system that does not offer universal coverage of primary care, the report says. Gaps in health coverage create financial barriers to access, particularly for those just above the threshold for medical cards.

The report points to figures that show Irish GPs are the highest paid in the OECD and earn the second highest multiple of average wages, but says improved data is needed. Considerable savings could also be made by cutting salaries for hospital doctors (this has since happened for new entrants).

The report says the Irish health system is experiencing unprecedented reductions in public spending. Cuts are compounded by underlying cost pressures. Some of these are caused by weaknesses in the system, such as high salaries and drug prices and poorly developed primary care, while others are due to factors beyond the control of the health system such as population growth and the recession.

The department was closely involved in the preparation of the report, which was completed in time to “inform” budget discussions on health spending.

The authors warn that efficiency gains from planned and additional reforms will not be sufficient to fund Minister for Health Dr James Reilly’s ambitious plans to provide universal access to primary care and strengthen services. These commitments will require additional revenue. Although there is scope to make substantial additional savings through greater efficiency, these cannot be made within the required timeframe without damaging patient care, unless high salaries and the high price of other inputs are seriously addressed, the report says.

If this is not feasible, it says the Government should consider establishing a mechanism to compensate the department and the HSE for unavoidable increased demand for health and long-term care.