Mr. Tony O'Brien:

I thank the Deputy. The overall drugs spend is in the region of €1.8 billion. In the past couple of years significant inroads have been made to the individual cost of medications. This has arisen from two sources, one of which is what is known as the IPHA agreement. This is the agreement between the Department of Health, the HSE and the Irish Pharmaceutical Healthcare Association which has reduced the cost of patented medications on an agreed basis.

Separate to this, in 2013 reference pricing legislation came into effect, which is of relevance where there are interchangeable medications. In other words, molecular equivalents. As a result of this, and the powers given to the HSE at that time, we have been, on a continuous basis and starting with the highest volume and, therefore, the highest cost medications, referencing down in accordance with the legislation against the European average. We are in the process of completing a second round in regard to some of the higher value medications which are enabling the overall cost of medications, both for the State and individuals, to be reduced. We are required to proceed with a degree of caution. We must take into account the impact on supply and also the risk of co-payments. This has not been a significant issue so far and the reference pricing approach has proceeded very effectively. At the end of this year we will be in a position to provide a retrospective report.