A 40 per cent drop in the price of up to 300 commonly prescribed drugs, comes into effect today and is expected to save the State up to €94 million in a full year.
Following discussions with Minister for Health Mary Harney, the Irish Pharmaceutical Healthcare Association (IPHA) is to drop the price of long-established medicines, which are coming out of patent and are among the most commonly prescribed.
It has established a website checkthelist.ie for customers to see the drugs included in the reduction and the changed prices. A low-call number – 1890 876 700 – has also been set up.
Brian Murphy, IPHA’s director of commercial affairs said patients could “save between €3-€4 on every €10 they spend”.
“That’s a potential saving of up to €500 per year,” he said.
Mr Murphy said the IPHA was in a position to reduce prices because “the country is in a very difficult situation at the moment and we have to respond to the environment within which we operate.”
He said: “We are in a different economy from the one we were in two years ago, we are in a different world and the pharmaceutical industry just like everybody else has to respond to that and provide the State with money and help patients to finance their purchase of medicines.
“Its going to cost the industry over €100 million on top of savings we were already providing we would estimate between now and 2012 we’re going to be providing the state with nearly €750 million of savings,” Mr Murphy added.
In a statement, Ms Harney said she was pleased drug companies in the IPHA had responded to her request to reduce costs.
"These 40 per cent price cuts on 300 of the most common off-patent drugs will save taxpayers and consumers considerable amounts of money - well over €90 million for taxpayers and several millions for consumers when they pay for drugs themselves.
"I would hope that generic drugs manufacturers who have not yet decided to cut their prices for these drugs will follow," the Minister said.
She also welcomed the publication of prices by the manufacturers, adding it was important consumer paying for drugs under the Drugs Payment Scheme could see the price the HSE will pay for the same drug over the €120 threshold in the scheme.
Ms Harney pledged legislation this year to allow for reference pricing/generic drug substitution to be implemented from next year onwards. "This will put in place a dynamic system for continual price reductions on drugs that are off-patent," she said.
The IPHA represents international research-based pharmaceutical companies which make up 90 per cent of manufacturers in Ireland.
The Association of Pharmaceutical Manufacturers in Ireland (APMI), representing the remaining pharmaceutical companies, was also in talks with Ms Harney but did not reach agreement on price cuts. The APMI companies manufacture generic drugs which are already out of patent and therefore cheaper.
Ms Harney expressed her disappointment that the APMI members had “declined to offer any reductions” and noted that the current agreement with these companies expires on September 1st.