Pharma body hopeful of extending deal with State on cost of medicines

Current agreement due to expire at the end of July after savings of about €600m

The pharmaceutical industry has said it is hopeful that an extension can be agree this week to the current agreement with the Government on the cost of medicines.

The current accord, which has been in place for the past four years and which has generated savings of about €600 million, is scheduled to expire at the end of July.

It is understood that talks have been under way between the Irish Pharmaceutical Healthcare Association (IPHA) and representatives of the Department of Health and HSE.

The Irish Times reported this month that the pharma industry had signalled that it would not agree to an extension of the existing deal unless the Government lifted an embargo on the HSE reimbursing new drugs, which have additional costs.


IPHA said on Wednesday: “We are continuing to engage constructively with the health authorities on a short-term extension to the existing agreement. For an extension to be viable we will need to see reimbursement restarted this year for new medicines.

“These medicines have satisfied the State’s clinical effectiveness and value-for-money tests. They are all widely available in the EU. Patients deserve the best treatment options. We are hopeful that an extension can be agreed this week. It is in everyone’s interest.”

The pharma industry is unhappy with the block introduced last year by the Department of Public Expenditure on newly-available drugs and medicines being reimbursed by the HSE if they generated additional costs.

The industry believes that about a dozen new drugs, which have gone through a process with the HSE on their clinical worthiness and on price, have been held up.

It is understood a small number of drugs related to dealing with the Covid-19 pandemic – such as medicines that can lead to the avoidance of hospitalisation of patients – have been authorised in recent months.

New drugs which are budget-neutral or which result in savings being made are being authorised for reimbursement by the HSE.


The Department of Health said on Wednesday: "The existing framework agreement on the supply and pricing of medicines with the Irish Pharmaceutical Healthcare Association is due to expire on July 31st this year. The agreement provides that all obligations under the agreement shall cease after that date unless continued by mutual agreement of the parties.

“It has not been possible to adequately prepare for a successor agreement because of the concentration of effort and resources in both the Department of Health and the HSE towards the Covid crisis. In the circumstances, the department/HSE are in consultation with the Irish Pharmaceutical Healthcare Association with a view to extending the existing agreement.”

Martin Wall

Martin Wall

Martin Wall is Washington Correspondent of The Irish Times. He was previously industry correspondent