Opposition politicians may have largely abandoned their sallies on Minister for Health James Reilly’s position on the bumping-up of a site in Balbriggan belonging to his associate, for development as a primary care centre, but controversy and malodour involving the Minister and his actions are not going away. Today we learn of continued resistance by consultants to his late-in-the-day reform of work practices, but it was earlier this week that the Minister revealed in the Dail that practically all medicines used in the Irish public health system are expensive non-generic medicines. This compares with just 20% use of non-generic medicines in our closest neighbour, the UK.
Minister Reilly was responding to a series of questions from the Sinn Fein health spokesman Caoimhghin O’Caolain and the Sinn Fein finance spokesperson Pearse Doherty. It was revealed that in 2011, a staggering total of €1.85bn of drugs were prescribed in Ireland and that just a paltry €100m per annum are non-generic. In a recent IMF report on selected issues in Ireland, it was revealed that in the UK, 80% of drugs prescribed are generic. It seems that the IMF estimate of generic drug use in Ireland of 20% was four times over the true percentage*, which just aggravates the point being made by the IMF. Generic drugs, whose patents may have expired, are less expensive than non-generic drugs, yet Ireland’s health service, overseen by Minister Reilly is aloof to tackling an area which could see hundreds of millions of euro savings per annum. Just how much longer can this minister continue in his post.
The full parliamentary questions and responses are here:
Deputy Caoimhghín Ó Caoláin: To ask the Minister for Health the full drugs bill for the Health Service Executive for 2010, 2011 and to date in 2012; if he will provide a breakdown of same by scheme, by patent status and branded generic status.
Deputy Pearse Doherty: To ask the Minister for Health if he will provide an estimate of the cost of drugs and medication used by the public health service in each of 2010 and 2011.
Deputy Pearse Doherty: To ask the Minister for Health if he will provide an estimate of the cost of generic drugs and medication used by the public health service in 2010 and 2011.
Minister for Health, James Reilly: HSE expenditure on drugs and non-drug items (dressings, etc.) under the GMS and community drug schemes for the years 2010 and 2011, including mark ups and dispensing fees for pharmacists and wholesalers, is set out in the following table:
The HSE’s Performance Report indicates that expenditure up to July 2012 is approximately €1 billion . Expenditure on generic drugs is estimated to be in the region of €100 million per annum.
The outstanding information sought by the Deputies is being collated and will be supplied as soon as possible.
* UPDATE: 25th October, 2012. It has been pointed out that the IMF study examined volume which showed that 20% of volume was non-generic, the PQs above reveal that 5% by value is non-generic.
Look, everybody needs to understand: The purpose of the public treasury is, in large part, to make a certain class of people and companies very wealthy.
If the government doesn’t overpay for drugs, health services, services in general and pensions, then these people will lose the majority of and quite possibly all of their income. If they even _think_ that such a thing is likely to happen, this class will topple the government and replace it with something else. For examples, see South and Central America.
The Irish government uses generic drugs only 5% of the time because the primary purpose of the GMS and community drug schemes is to make money for pharmaceutics companies and their attaches. Yes, healing sick people is in there somewhere, but the main goal is to take a big scoop out the the tax revenue honeypot and pour it into the mouths of those who have worked their way into the corridors (and it is the corridors over the offices) of power.
The Minister is doing his job. His job is to keep these people sweet so that they will continue to support the government. If they sour, the government will lose the unions, the professions, the media, and the financial support it means. Hence I think Reilly will remain in his position for a good deal longer than you might think.
This is an excellent post. Just the sort of money saving – very large amounts of money! – that needs to be driven through.
This kills me as it should be such a simple thing to implement. Purchasing generics should not need legislation, it should be good procurement practice.
There are two reasons why the public is being screwed here. One, the government is afraid of upsetting the pharmaceutical companies based in Ireland, by buying generic drugs. Two (and this is the biggest problem) the purchasers and retailers of the drugs are “bribed” by the drug manufacturers – not very subtly – into using and purveying the branded drugs.
This is poorly researched and misunderstood, generic prices in Ireland are only 5% below branded prices. Already with out the implementation of the health bill there has been extensive substitutuion of many brands I have the IMS data to show, the problem is that the state is not accruing these benefits it is pharmacists that are creaming the profits as they receive the 95% of the reimbursement price while the generics companies charge them less that 10% cost of goods. This is the reality, there is little saving to the government in generics for that reason. I hope you spend more time and effort on getting your core NAMA facts right as this is a poor reflection on the site
Would be good to know a little more — do you have a reference? You would think that competition between pharmacists would drive down those profit margins, if I am understanding your argument correctly.
With respect, that’s rubbish. Would you care to give examples to back up the statement?
Reilly recently trumpeted the ‘savings’ of some 400 million euro in drug purchases over the next three years.A triumph for DOH negotiators!
It appears that an average of 1.8 billion is spent on drugs,both branded and generic,per annum.On that basis our DOH friends will ok a spend of say 5.4 billion less the 400 million ‘saving’ – so the ‘saving’ will be 400 million on a total spend of 5.4 billion which equals about I estimate is about 8% – providing ,of course,that prices do not increase over the period!
No wonder IPHA were pleased with the result!
Its a no brainier why the dithering…the Troika supportive after all that’s who really counts….
“The authorities are alert to the health sector overruns and are determined to meet the programme target for a budget deficit below 7.5 percent of GDP in 2013. The measures adopted in Budget 2013 should be durable, as growth-friendly as possible, and minimise the burden of adjustment on the most vulnerable.”
http://www.imf.org/external/np/sec/pr/2012/pr12398.htm
@rich: “…generic prices in Ireland are only 5% below branded prices.”
Where is the date to back up this (frankly difficult to believe) claim?
http://www.sspcrs.ie/druglist/search.jsp
Ok folks do your own research, for example Bisop is the generic version of the off patent product Cardicor. Type in the 2 names above and you will get the reimbursement price. Again folks do your research easy to blame the big bad corporations, its the little vested interest that have this country in the state its in not the inovators eg Dr’s, pharmacists, solicitors, real estate agents..
Vinny
I see you make no reference to previous price cuts I guess that wouldnt suit what ever agenda your peddling
The obvious thing would be to ask a team from e.g. the UK and Denmark over to make suggestions to reduce the drug cost price to the taxpayer, including all issues i.e. generics, doctors, pharmacists etc.
this was a game changer by Boots…
“Irish prescription drug prices are set to fall by an average 25% on June 1, as pharmacy chains replace their 50% mark-up on drug cost prices plus a 5-euro dispensing fee with a single 7-euro “professional services fee” added to the cost price.
The first chain to announce the move was Boots Ireland, which said the changes would dramatically reduce the prices of most prescription drugs and that, across the top 10 most expensive medicines, all prices would be reduced by an average of 25%.”
http://www.pharmatimes.com/article/12-05-31/Irish_prescription_drug_prices_set_to_tumble_on_June_1.aspx
decent review of pending legislation..
“The Health (Pricing and Supply of Medicinal Goods) Bill 2012 will have significant consequences for all stakeholders in the pharmaceutical supply chain when enacted. The proposed changes include establishing groups of medicinal products which are interchangeable for prescription purposes, the introduction of reference pricing, and generic substitution for medicinal products. The principal features of the Bill are:”
http://www.lexology.com/library/detail.aspx?g=b4a133d6-6e26-44fc-97a7-c9eca2b0ac6a
John
You still dont understand that reference pricing and generic substitution will save very little for the government, refernce prices will probably be approx 50% of the original patent protected price, a price to which IPHA has agreed to cut off patent medicines in the second year after going off patent. When Generic substitution becomes enacted then all brands will be quickly replaced by pharmacists as they buy generics for approx 10% of reimbursement value, the state still pays the ‘50%’ price and the supply chain pockets the difference
So your game changer comment ranks up there Inda’s ill fated words
@Rich just saying….but dint ‘Inda’ not just get an award,man of the match or MVP in Europe.
“As the Irish Parliament is in summer recess until 18 September 2012, there will be no legislative progress on the Bill until after that date. It is next due to go before the Irish Senate for debate. We expect that the Bill will be subject to significant lobbying and debate and propose to track and update you on any significant changes, as the Bill progresses through the legislative process.”
http://www.mop.ie/news-and-insight/insight/pages/health-pricing-and-supply-of-medical-goods-bill-2012
I payE132 per month for all meds. for which I thank the Govt.as I would not be able to afford them otherwise .Imagine my surprise, recently, when I read that one of them was about to be reduced by 32% which would give a reduction of E8 .The chemist told me the cost was over my E130 one month when it was the only one that needed replacing.When did 32% of E132+ become eight euro? I think that the pharmacys are getting away with murder- price wise. Also, how come they do not put the prices of individual meds on the receipts they issue? I think it is time to investigate what profit the pharmacist is making? I tried one of the generic versions of one of my prescribed drugs. I had a reaction to it!!! .Turns out they are not quite the same.The coating was what caused my problem.
There’s a 90% reduction in the cost of generic drugs if they are bought from the most competitive supplier. Anything less is price gouging by the vendor.
See Costco and the difference between lipitor and its generic equivalent for comparison:
http://www2.costco.com/Pharmacy/DrugInfo.aspx?p=1&SearchTerm=lipitor&Drug=LIPITOR
There is no chance in hell the Irish govt will do anything to upset glaxo,( in all the forms) and the other big companies.
Consider the 400 million saving recently announced and the amazing saved jobs jobs Sligo (same day). Are they related?
If they are, then the 400 mill is a deal that suits big pharma, not the customer, hence the saved jobs. Otherwise the govt would have faced another lost jobs headline. Maybe it should have been 600 mill saved but the threat was there…..
@rich, it is strange to side with big pharma in Ireland, they have no moral high ground, no moral fibre and are giving it to Ireland up the ass for a long long time now. When it suits, they (will) walk away. I spend my life so far around big pharma, they make bankers look like angels.
Generic drug pricing in the USA. Note the mark ups from 284% in Costco to 1841% in Canada 1.
http://web.archive.org/web/20050406040559/http://web.wxyz.com/extras/040205-drugchart.html
Every day in every way, someone’s out to screw you…
pick your ‘poison’ here some really excellent speakers, apologies NWL a little off topic,ok,ok a lot but health care is discussed…
http://www.livestream.com/theeconomist?utm_source=lsplayer&utm_medium=embed&utm_campaign=footerlinks
@ sf ca
Im not simply siding with big pharma, I’m simply making the point that the black and white simplification on this site of the costs of medicines is not so. No doubt medicines are priced to reflect research costs, there is a huge amount of support necessary to supply medicines in Ireland and most of the improved life expectancy and quality of life they provide is taken for granted. People think nothing of spending €50 on a few pints or €100 to fill a tank of petrol or for that matter a few thousand euros on a holiday – why – because they enjoy or to some extent need those services- medicines keep people healthy and alive – medicines are relativley cheap by comparison to the benefit they offer and Irish medicines are reference in price to 9 other EU countries including Spain and the UK. Can you say that for anything else you buy in overprced Ireland?
@rich maybe they (big pharma) play fair by the rules as are, can’t blame them for that…but who should call the shots, big pharma or the govt trying to promote a healthy society.? I know, different argument, different day…same players though.
As for pricing, pharma is risky, no secret there, but the rewards…who else gets that kind of reward from a customer base that might die without them? Drug pushers of course.
It’s by no means a simple issue to resolve (certainly not just good procurement). Even generics needs to be authorised for sale in Ireland. Compare the prices of something like OTC generic ibuprofen (no doctors in the mix and should be competitive market at pharmacy level). The cheapest Irish generic is more than 1000% the cost of the cheapest equivalent in the UK.
However, just because it might be a complex problem to solve doesn’t excuse the near total inertia and ineptitude in tackling the issue by the well-paid civil servants and politicians whose jobs it should be to sort it out.
Big pharma companies do not play by the rules. They are drug pushers and bribe the medics, pharmacists, consultants – anyone who has a say in the purchase of drugs with free “all expenses paid” trips to the most exotic places in the world. It’s the mot corrupt business I have ever seen. No one else compares.
Forget the pushers on the street corner. They don’t comes close in terms of immorality.
No discussion on Ireland and drugs is complete without mention of Elan
They,over time, destroyed pensions, careers, national reputation for ability to create a real drug company…they left behind a trail of destruction…all because once upon a time their shares (due entirely to dodgy accounts) were in the 40 dollar range and cowen and everybody else was trippin’ on the ol’ “best little country in the world for new business, best employees on earth, striding the big pharma world stage and on and on with the BS..
What’s left? Nothing. I expect the last batch of ex Elaners to be walking the streets by April.. Then the name is confined to history.
Now the big question….. Did Ireland benefit in the long term?
Not a chance…ask your parents, look at your own pension, ask a banker…no one escaped as Elan had a disproportionate share of the total volume of ISEQ (due to dodgy accounts)…when they blipped the whole country suffered.
Second question…what other companies had their fuzzies warmed so much so often as Ireland’s favorite big pharma boy. Not any profitable small business I can think of. Not a one.
Linked,read and reviewed a few things on this topic here,not my area at all but this report while a bit heavy going at times is excellent,there may be a good rebuttal available but I did not come across one.
Cliff Notes or Cheat Sheet.
“The report, Delivery of Pharmaceuticals in Ireland – Getting a Bigger Bang for the Buck, has just been published. The report records that Ireland spent about €1.9 billion (17.5% of public health expenditure) on pharmaceutical products in 2010, while in 2009, Ireland spent more on pharmaceuticals per capita than any other OECD country apart from the US, Canada and Greece.”
http://www.lexology.com/library/detail.aspx?g=b42637f1-2733-4fdf-b2de-5989adda4d75
Full Report:
@NWL your number above is too low…..oh just stick to your knitting :)
“light” relief
http://www.sfgate.com/sfis/article/Three-bedroom-unit-in-The-Infinity-is-listed-for-3981651.php
Yes John well done, of course I doubt you looked into the fine print, the core reason for greater spend per capita is the greater number of prescriptions per person – it’s not just houses we demand more of!
@Rich,hi Rich actually yep i did,was a bit perturbed that the HSE sponsored and funded the ERSI paper,so it carries a caveat.Sad but my idea of a fun evening is a few good reports or regulatory fillings..i know i know…..or videos from a good conference,each to their own huh!
Is there anything worth reading with a counter viewpoint ?
I’m NY based so no vested interest,as an aside the link to the Economist conference,above contains a very controversial speech by David Einhorn,creating quite a stir over here.Basically he had a go at Ben Bernanke and monetary policy/easing,quite controversial, zerohedge etc. covering it.
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