Alex White (Dublin South, Labour) | Oireachtas source

The State has introduced a series of reforms in recent years to reduce pharmaceutical prices and expenditure. These have resulted in reductions in the prices of thousands of medicines. Price reductions of the order of 30% per item reimbursed have been achieved between 2009 and 2013; the average cost per items reimbursed is now running at 2001-02 levels. Additional savings measures are expected to generate net savings of approximately €152 million in 2014, as follows: new agreements were reached with the Irish Pharmaceutical Healthcare Association, IPHA, and the Association of Pharmaceutical Manufacturers in Ireland, APMI, in October 2012. It is estimated that the combined gross savings from the IPHA and APMI deals will be in excess of €120 million in 2013 with an additional €28 million saved in 2014. The Health (Pricing and Supply of Medical Goods) Act 2013, which came into operation on 24 June, introduces a system of generic substitution and reference pricing. This legislation will promote price competition among suppliers and ensure that lower prices are paid for these medicines resulting in further savings for both taxpayers and patients. It is estimated that this system will yield €50 million in savings in 2014.

As announced in budget 2014, it has become necessary to increase the prescription charge due to the very difficult and challenging economic environment which requires the Government to achieve additional savings in health expenditure, with €666 million of savings targeted in 2014. The increase in prescription charges will account for €43 million of this target. The Government is committed to achieving these savings while protecting front-line services to the most vulnerable to the greatest extent possible.

A review was carried out earlier this year under the Financial Emergency Measures in the Public Interest Act 2009, FEMPI, regarding the operation, effectiveness and impact of the amounts and rates payable to certain health professionals under the relevant regulations. The 20% retail mark-up to community pharmacists in respect of items dispensed under the drug payment scheme, the long-term illness scheme, the European Economic Area scheme and the Health (Amendment) Act 1996 scheme was eliminated.

The 2014 saving arising from this measure will be approximately €17 million. In addition, provision was made in budget 2014 for €10 million in savings arising from the removal of products from the reimbursement list. The HSE will now consider products for review in compliance with the provisions of the Health (Pricing and Supply of Medical Goods) Act 2013.

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