Ireland threatens to cap drug prices
- Ireland's government is mulling legislation that would cap prices on older medications that drug makers have been unwilling to discount. The goal: To free up capital to ensure access to newer, more expensive medications.
- Current pricing is based on a 2012 agreement in which drug prices in Ireland are benchmarked against nine other EU countries. The agreement expires in November. Ireland's Department of Health is making the argument that drug prices have dropped since the agreement was signed—and that a readjustment is in order.
- The Irish Pharmaceutical Healthcare Association is maintaining its position that the deal does not allow for a readjustment.
The stand-off between the Irish Department of Health and pharmaceutical companies reflects what's happening in many markets, as payers try to figure out how to pay for expensive new therapies for cancer, rare diseases, and hepatitis C. The government's goal is to lower the benchmarked drug prices, based on their assertion that overall prices have fallen since 2012, in order to fund more expensive drugs and ensure access.
Another dimension to this story is the fact that 25,000 people in Ireland are employed by the pharmaceutical industry. With some of the biggest players in Ireland, such as Shire, and other companies relocating headquarters there to enjoy tax breaks, there is a certain irony in the stand-off between the government and the pharmaceutical industry.
Over here in the states, President Obama proposed direct Medicare Part D drug price negotiations in his new budget.