Madam, – Thomas Mc Cullough suggests (February 3rd) that in relation to making savings on medications for taxpayers, HSE negotiators have not “really tried”.
Since the mid 1970s, medication costs in Ireland increased without challenge. When established in 2005, the HSE identified the potential for very significant savings to be made in medication costs. It established an expert team to pursue these savings and in 2006 reached agreement with pharmaceutical manufacturers to reduce the price of off-patent medication by 35 per cent. The cost of new patent medications was also reduced.
The HSE then focused on reducing the charges from wholesalers and pharmacies. Naturally, its initial attempts were met by resistance from those who are affected by the changes. In addition, the HSE was criticised for seeking such reductions by some media commentators and public representatives.
After prolonged legal challenge the cost savings were achieved with full Government support. These savings, and the most recent agreement by the pharmaceutical manufacturers to reduce charges further for non-patented medicines, has resulted in annual savings to the taxpayer of approximately €250 million a year on medication costs.
More work is being done in a number of areas to reduce costs further, eg, the process of setting reference prices is underway with the support of the Minister for Health and Children, Mary Harney TD, who has at all times given her full support to reducing medication costs. A reference price is the fixed price for a medicine that the State will pay irrespective of who manufactures it. This includes a strong focus on generic medications and will yield further significant savings for taxpayers. – Yours, etc,