Drug prices here among the highest in Europe

Commonly-used generic drugs are up to 25 times dearer in Ireland compared to New Zealand, according to a report from the Economic and Social Research Institute.

Ireland had the highest prices for nine out of 13 commonly used generic medicines compared to other European countries, the study by the Economic and Social Research Institute (ESRI) found.

For in-patent drugs, Ireland was among the three most expensive European countries surveyed for 10 leading products.

The actual price differences faced by consumers are probably higher as the study examined ex-factory prices in 2013 rather than the retail price charged to customers in pharmacies.

Prices for branded drugs that have gone off patent and are competing against generic rivals are lower on average in Ireland compared to our European neighbours.

Prices similar
The use of generics is increasing, with their market share doubling between 2010 and 2012 to reach 50 per cent. However, because the price of generic drugs in Ireland tends to be similar to that of the original branded drug, this hasn't yet led to substantial reductions in drug spending for either the State or private customers.

New legislation on drug pricing “holds out the possibility” of a radical change in the way prices are set, according to the institute. “However, lack of clarity and precision as to how prices will be set under the Health [Pricing and Medical Goods] Act means that it is not possible to predict with any certainty that pharmaceutical prices in Ireland will fall vis-à-vis comparable member states.”

Because the Act allows for tendering and unilateral price reductions, the State may succeed in capturing a significant portion of the discounts, kickbacks and deals that are common in the sector, the report says. Prices would fall if more regular realignments took place, as happens in other countries, it adds.

Troika demand
The study was commissioned by the Department of Health and the HSE on foot of a demand from the troika for more research into Irish drug prices.

However, the Irish Pharmaceutical Healthcare Association, which represents the branded drug manufacturers, claimed more frequent price alignments would destabilise the market and lead to product shortages. It also said Irish prices should be based on the average of nine European countries and not the lowest prices in the basket, as suggested by the ESRI.

The study points to the role of prescribers – usually doctors – in contributing to high prices. It says that for many key medicines, prescribers in Ireland tend to select the most expensive pharmaceutical product. In contrast, their counterparts in the UK often select the cheapest. Switching from the dearest statin to a cheaper generic would save the HSE €3.2 million a year, it points out.

Price display
To ensure patients are well informed, pharmacists could be required to display the prices of commonly prescribed medicines.

Overall, prices have dropped over the past two years, though by varying amounts. In-patent drug prices fell by between 1 and 40 per cent for selected products, while for generic drugs, prices for six out of 10 products were unchanged.