James Reilly (Dublin North, Fine Gael)
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Question 43: To ask the Minister for Health and Children if she will report on recent discussions with pharmacists; if progress has been made; if not, the plans her Department has to ensure continuity of supply of medicines to pensioners, social welfare recipients and other patients on medical cards and various refund schemes that may be affected by the pharmacists' threat to withdraw from such schemes on 1 December 2007; and if she will make a statement on the matter. [30306/07]

Jan O'Sullivan (Limerick East, Labour)
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Question 46: To ask the Minister for Health and Children if she will instruct the Health Service Executive to resume talks with the Irish Pharmaceutical Union to resolve the issues that are leading to the threatened withdrawal of medication to vulnerable patients from 1 December 2007; and if she will make a statement on the matter. [30019/07]

Mary Harney (Dublin Mid West, Progressive Democrats)
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I propose to take Questions Nos. 43 and 46 together.

I previously outlined in detail to the Oireachtas the legal provisions under competition law which prevent the Health Service Executive, HSE, from negotiating with the Irish Pharmaceutical Union, IPU, on fees, prices and margins for its members. When it became clear that the HSE could not negotiate with pharmacists or wholesalers on fees and margins, a detailed, fair and transparent consultation process, including independent economic analysis and public consultation, was carried out to inform the final determination of the new reimbursement pricing arrangements for drugs and medicines under the GMS and community drugs schemes. These new arrangements were announced by the HSE on 17 September last.

In regard to the new reimbursement prices, the main wholesale companies have confirmed they will charge community pharmacists the same amount for these drugs and medicines as pharmacists are reimbursed by the HSE for these products. Furthermore, no changes are planned by the HSE to the operation of the GMS medical card and community drugs schemes, and all patients continue to receive their entitlements in the normal way.

The HSE has not received formal notification from any community pharmacist regarding cessation of services under the GMS or the various community drugs schemes. In the event, they will be required to give three months' notice in writing of any intention to cease providing this service. To address concerns expressed by the IPU on behalf of community pharmacists about the implications of the legal advice on competition law as regards their right to negotiate fees through the union, a process of dialogue was established, chaired by Mr. Bill Shipsey SC, to explore ways in which their fears might be addressed. Despite the suspension of this process during the recent withdrawal by individual pharmacists of methadone services, there has recently been renewed engagement between the Irish Pharmaceutical Union and the HSE under the auspices of Mr. Shipsey. I am exploring, in consultation with the Attorney General, other relevant Departments and the HSE, the best way of progressing the development of a new contract with pharmacists.

James Reilly (Dublin North, Fine Gael)
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I state categorically that I and the Fine Gael Party will not and cannot condone any action by pharmacists or the HSE which endangers the well-being of patients. The dispute is dragging on because there is no clear path to resolution. There is no mechanism by which resolution may be achieved. It is clear that the HSE ignored the advice of its consultants, Indecon, who recommended that it should engage in consultation before bringing in this measure and that any change should be introduced gradually. A reduction from 17% to 8% is not gradual.

It is clear that the HSE will not engage with the IPU in a meaningful way and that patient services, once again, are under threat. We in Fine Gael recognise the need, and the right of the taxpayer, for the Minister and the HSE to seek savings. However, it is important this does not come about at the cost of service to patients. Will the Minister appoint an independent arbitrator to get this dispute sorted out so that the most vulnerable people in our society are guaranteed continuity of supply of their medications, particularly coming up to Christmas and the winter period in which the incidence of illness is always greater? Will she postpone the proposed changes until an independent impact study is carried out? This is important because to talk about an independent and fair process is all right, but it will neither be fair nor construed as such unless it is independent, as the HSE initiative in this regard was not so.

Will the Minister outline again what provisions are in place should the pharmacists withdraw services as they have threatened on 1 December? It is not good enough of the Minister to tell the House that she has not received formal notification of withdrawal. If people go out en masse contractual rights will go out the window, the three months' notice will not be given and we are faced with 1.5 million people being unable to get their medication.

Mary Harney (Dublin Mid West, Progressive Democrats)
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I welcome what the Deputy said on behalf of his party and I share his view. As the Deputy is aware, this legal advice came to hand as a result of the negotiations that had begun with the wholesalers. The intention, always, was to negotiate and we respect bodies that organise around trade unions and have always dealt with organisations on that basis. Clearly, we cannot breach Irish competition law or EU law and that is why the Shipsey process was put in place.

I understand there was a very good meeting last night between lawyers representing the IPU and the HSE, respectively. I hope that as a result we are in a position to put a framework in place to resolve the outstanding issues. There are a number of issues to be considered, one of which is the nature of the contract. I am a strong fan of incentivising contract holders, whether they are pharmacists, general practitioners or dentists, towards providing a wider range of services, working longer hours and so on. These are all matters for discussion, and medication management is also important.

As the Deputy is aware we are trying to achieve a number of goals. One is value for money and greater efficiency. Our drugs bill has gone up by 373% in recent years, or 2.5 times greater than the rate of inflation. We are not reducing the wholesale margin gradually. It is being reduced from 1 December to 8% and to 7% from 2009. These margin percentages are in line with what is being paid in other countries. We want to separate from the commodity price the professional or dispensing fee paid for the professional services of the pharmacist. We also want to ensure that there is fair return. I am a strong fan of entrepreneurship and as pharmacists are entrepreneurs we want to see their efforts rewarded. There are a number of legal mechanisms through which prices can be established, one of which is an arbitration system. These matters are being explored by me in consultation with the HSE and the Attorney General.

Jan O'Sullivan (Limerick East, Labour)
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I welcome the fact that the lawyers re-engaged last night because the news last week was that they had disengaged. I hope that process will find a resolution to the problem.

Will the Minister say whether she and the HSE are willing to accept a neutral chairperson to address this issue, as has been proposed? Specific eminent people were proposed by the pharmacists. She said she was consulting the Attorney General. Is that in relation to the interpretation of the Competition Act? If so, will she be willing to accept consideration of the Labour Party's amendment to the Competition Act in Government time? She will have plenty of time tomorrow because there is no legislation on the Order Paper. Will she consider debating that amendment as a possible step towards resolution of the dispute?

The import of what wholesalers are saying to pharmacists appears to be different from what they are telling the Department of Health and Children and the HSE. The Joint Committee on Health and Children heard last week that pharmacists were being told that wholesalers are not going to bring prices down to what will be paid to them if the new arrangements are introduced. Is the Minister aware of different reports about what precisely the wholesalers might do.

Mary Harney (Dublin Mid West, Progressive Democrats)
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To answer the first of the Deputy's three questions, I do not know how one might define "eminent" in this context, but the idea of a neutral, independent, acceptable person is a mechanism for consideration within the legal advice that has been given to me to date.

James Reilly (Dublin North, Fine Gael)
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The chief executive of the Labour Relations Commission, perhaps.

Mary Harney (Dublin Mid West, Progressive Democrats)
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I want to clarify on the record that the Attorney General is not involved in the advice procedure because of a conflict of interest. He has made arrangements for counsel to advise us. Whether the person is eminent or well known, it is the objectivity and acceptability of the incumbent that matters and it may well turn out to be a process for more than one person. Clearly, the same process will have to be put in place for general practitioners, dentists and other self-employed professionals.

As regards legal advice, it is not just a matter of Irish competition law but EU law as well. Price fixing with self-employed professionals on a class basis is prohibited and it would not be desirable to change those aspects of Irish competition law. One might as well tear up the competition Acts if one could engage in such practices.

Jan O'Sullivan (Limerick East, Labour)
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Will the Minister say why people should not be represented by their union?

Mary Harney (Dublin Mid West, Progressive Democrats)
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This is not a question of representation but of price fixing and setting prices and margins, and European law is very clear on this issue. It has wide implications for staff other than health service personnel, including self-employed veterinarians and, perhaps, some members of the legal profession. That is why so much advice is required.

This matter was brought to the attention of the HSE, which entered into negotiations in good faith, by the wholesalers. It was the legal advice of the latter that brought the matter to everybody's attention and it was examined by lawyers of the HSE and the Office of the Attorney General. We are not trying to achieve a reduction in what we pay for medicines since the price will continue to rise, given Irish demographics and new innovations; rather, we are trying to slow down the pace at which the price is rising.

James Reilly (Dublin North, Fine Gael)
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Will the Minister clarify whether she is prepared to postpone the HSE's changes on 1 December to ensure patients will have continuity of medical supply in the weeks approaching Christmas? Will she agree to the appointment of an independent arbitrator? In this regard, mention was made of Mr. Kieran Mulvey, an eminent person who is very experienced in this area.

Jan O'Sullivan (Limerick East, Labour)
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Will the Minister ensure a process is put in place in order that very vulnerable patients will not be faced with the fear of not being able to obtain their medication on 1 December?

Mary Harney (Dublin Mid West, Progressive Democrats)
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I do not believe large numbers of professional pharmacists will not supply medical card patients and others with their necessary medication. I salute the efforts made by the Irish Pharmaceutical Union when methadone was withdrawn by a number of pharmacists.

Jimmy Devins (Sligo-North Leitrim, Fianna Fail)
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Hear, hear.

Mary Harney (Dublin Mid West, Progressive Democrats)
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It was extraordinarily professional and courageous.

I will not state what personalities would be acceptable because it would not be advisable to do so. The contract is between the pharmacists and the HSE, not between me and the pharmacists. Clearly, I have an important role to play in this regard and the meeting last night was very positive, but I do not want to say anything in the House that would jeopardise the positive outcome of the meeting. I understand there will be further talks in the coming days with a view to ensuring the development of a process acceptable to everybody. Mr. Bill Shipsey SC, who has done extraordinarily useful work in this regard, will have an important role to play in putting forward what I hope will be a solution to this problem.

James Reilly (Dublin North, Fine Gael)
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I remind the Minister that there is a contract between her and the patients who use the General Medical Service to obtain drugs.