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The Minister for Health, Dr James Reilly TD, and the Minister for Primary Care, Alex White TD, today (Friday, 1st November) announced immediate reductions in prices for atorvastatin products, which are used to control cholesterol. The price reductions are the result of the introduction of reference pricing under the Health (Pricing and Supply of Medical Goods) Act 2013.

Minister Reilly said that “The introduction of this first reference price, for a medicine which is used to control cholesterol, represents a major step in ensuring lower prices are paid for these medicines. The new reference prices for atorvastatin products means the HSE now pay 70% less for these products compared to May 2013. Patients will save on the cost of their medication and taxpayers will benefit from the reduced prices paid by the HSE.”

Minister White said “The introduction of reference prices will ensure that generic medicine prices in Ireland will fall towards European norms. It will safeguard value for money for the taxpayer and will mean that prices are set at levels which facilitate – not jeopardise – supply of these products in Ireland. Reference prices for this group of products will soon be followed by reference pricing for additional groups of medicines designated as interchangeable by the Irish Medicines Board (IMB).”

Reference prices are being introduced on a phased basis. The reference price is the price the HSE will reimburse to pharmacies for groups of interchangeable medicines. The IMB puts interchangeable medicines together into groups and the HSE may then set reference prices for these groups. Atorvastatin products were addressed first because they are the highest cost group of products reimbursed by the HSE. The HSE is now setting a reference price for esomeprazole products - used for the treatment of stomach conditions - and it is planned that prices for this group of products will be put in place by the beginning of December.

This system of generic substitution and reference pricing is provided for under the Health (Pricing and Supply of Medical Goods) Act 2013. It enables the HSE to set a reference price for groups of interchangeable medicines published by the IMB.

An information and education campaign, aimed at both health professionals and the public, is continuing. Patient information leaflets are being delivered to all community pharmacies and GP surgeries and further information is available at www.hse.ie/generics.

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Note for Editors

Generic substitution/Reference Pricing

A generic medicine is a medicine that is similar to an original, brand named medicine. It has the same active substances as the original medicine and is made to the same standard to make sure it is safe and effective. A generic medicine must meet exactly the same standards of quality and safety and have the same effect as the original medicine. Substitution will only be allowed where it is safe to do so.

Previously, when a specific brand of medicine was prescribed for a patient, a pharmacist could only supply that particular brand, even when less expensive generic versions of the same medicine were available. The Health (Pricing and Supply of Medical Goods) Act permits pharmacists to substitute medicines prescribed, provided that they have been designated as safely interchangeable by the Irish Medicines Board.

Reference pricing involves the setting of a common reimbursement price, or reference price, for a group of interchangeable medicines. It means that one reference price is set for each group or list of interchangeable medicines, and this is the price that the HSE will reimburse to pharmacies for all medicines in the group, regardless of the individual medicine price. A reference price may be set for each group of interchangeable medicines published by the IMB.

Once a List of Interchangeable Medicines is published by the IMB a two stage price reduction process gets underway. Firstly, under the terms of the 2012 APMI Agreement, the price of all relevant products fall by 20%, e.g. atorvastatin prices were reduced from 1st September and esomeprazole and rosuvastatin prices were reduced from 1st October.

Secondly, the legislation provides that the HSE may set a reference price for groups of interchangeable products published on the List of Interchangeable Products with a view to introducing further significant price cuts. Taking both price reductions into account, atorvastatin prices are down 70% since the introduction of generic substitution.

Under the legislation, a pharmacist presented with a prescription for an interchangeable medicine is required to offer the patient the lowest priced medicine available from within the interchangeable group. Eligible patients using State drug schemes like the Medical Card or Drugs Payment Scheme will not face any additional costs for products priced at or below the reference price. If a patient would like to receive a particular brand that costs more than the reference price then the patient will have to pay the additional cost of that product. In cases where substitution is prohibited for clinical reasons, patients will not face any additional costs if the prescribed product costs more than the reference price.

Generic substitution coupled with reference pricing provides patients with an incentive to opt for the cheapest available product, but does not impose any unavoidable additional costs on patients.

An information and education campaign, aimed at both health professionals and the public, is continuing. Patient information leaflets are being delivered to all community pharmacies and GP surgeries and further information is available at www.hse.ie/generics.

Please find Frequently Asked Questions here: http://www.dohc.ie/issues/Health_Act_2013/FAQs_2013_revised.pdf?direct=1

Further information on the process for determining interchangeability is available on the IMB website at http://www.imb.ie/EN/Human-Medicines/Generic-and-Interchangeable-Medicines.aspx.

Reference Prices for Atorvastatin

The following reference prices for atorvastatin will be effective from 1st November. :

· Atorvastatin 10 mg Film-coated Tablets (IC0001-002-003): €3.47 per 28 x 10 mg tabs;

· Atorvastatin 20 mg Film-coated Tablets (IC0001-003-003): €5.46 per 28 x 20 mg tabs;

· Atorvastatin 40 mg Film-coated Tablets (IC0001-004-003): €9.14 per 28 x 40 mg tabs;

· Atorvastatin 80 mg Film-coated Tablets (IC0001-005-003): €10.53 per 28 x 80 mg tabs.

Price reductions

From 1 November, in addition to reference pricing, the price of over 500 different presentations of various medicines will reduce by between 5% and 29%. This is as a consequence of the agreements reached with the Irish Pharmaceutical Healthcare Association (IPHA) and the Association of Pharmaceutical Manufacturers of Ireland (APMI) in 2012.

These reductions are in addition to price reductions implemented on 1 November 2012 and 1 January 2013 as a result of the agreements with IPHA and APMI.

The combined effect of initiatives introduced by Government in recent years has seen significant reductions in the prices of thousands of medicines, e.g. the average ingredient cost per item on the GMS Scheme has reduced from a peak of €18.97 in 2009 to €13.43 in January/February 2013, representing a 29% reduction in cost per item. The average cost per item reimbursed is now running at 2001–2002 levels.