Michael Ring (Mayo, Fine Gael)
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Question 336: To ask the Minister for Health and Children her views on whether there is a link between the departure from Ireland of the worlds largest pharmaceutical manufacturer (details supplied) and the upcoming price reductions on 1 March 2007. [6318/07]

Mary Harney (Dublin Mid West, Progressive Democrats)
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The Deputy will be pleased to know that my department and the Health Service Executive concluded negotiations in 2006 with pharmaceutical manufacturers, including the company referred to by the Deputy, on important new agreements setting out the pricing and supply of medicines for the Irish health service.

These agreements provide increased value for money for the State and the consumer through a reduction in the price of existing drugs and medicines coming off patent and through the use of a wider basket of countries for pricing new drugs. Over the period of the agreements, which run to 2010, it is expected to achieve savings of the order of €300 million across the GMS and community drugs schemes, and in the cost of drugs to hospitals, through off-patent price cuts of 35% for drugs with substitutable alternatives. In addition to the savings quantified, there will be further savings as generic manufacturers respond to the lower price of branded drugs. This will allow the State to invest in new and innovative treatments for the benefit of Irish patients.

There will also be savings through the use of a wider basket for pricing new medicines, along with two price reviews for new medicines over the term of the agreements. The new basket includes some traditionally lower priced countries, including Spain and Belgium, which will benefit the consumer over the medium term. Finally, for the first time, reimbursement of new drugs in Ireland can now be informed by pharmacoeconomic assessment, in line with other EU countries.

These agreements are the first stage in a process approved by the Cabinet Committee on Health to examine all aspects of the drug delivery system, from the manufacturer to the patient, in order to achieve greater value for money from the State's spending on drugs and medicines and in the operation of the drugs schemes, consistent with patient safety and continuity of supply.

Investment decisions are a commercial matter for the company concerned. There has been no indication by the company concerned to my department that there is any connection between this negotiated agreement and the event referred to by the Deputy.