- Ireland and the Irish Pharmaceutical Healthcare Association (IPHA) reached a new four year framework agreement, which will regulates the price and supply of drugs in that country.
- Prices will now be set on an annual basis to an average of prices in 14 European countries, the association announced Wednesday. The agreement adds five new countries to the previous pricing basket: Greece, Italy, Luxembourg, Portugal and Sweden.
- The Irish government has claimed it would save roughly €750 million ($825 million) through the agreement, reports the Irish Times. In exchange, brand-name drugs are somewhat protected from competition: original drugs receive a 50% price cut upon availability of a generic copy, while the price of biologics decreases by 20% when a biosimilar reaches the market.
The Healthcare Enterprise Association (HEA), an industry group representing generics and biosimilar medications, denounced the deal as anti-competitive because of the automatic price reductions provided when brand-name drugs are faced with competition.
"By sticking to a traditional, narrow negotiating model, the Government has weakened its position and failed to build on the reforms of 2013," said HEA president Sandra Gannon to the Irish Medical Times. "The logic of negotiating with some, not all, shows a clear lack of understanding of the dynamics involved in healthcare advancements."
But according to the IPHA, the negotiating industry group representing 38 pharmaceutical companies, the deal reduces state costs by 71% for ingredients and 50% of supply plus dispensing costs.
Irish subsidiaries of major pharma companies like Allergan, AstraZeneca, Merck, Pfizer, and Roche are among the 38 companies represented by the IPHA.
"This is the largest single package of savings the pharmaceutical industry has ever delivered to the State," said Leisha Daly, president of the IPHA. In addition to the pricing deal and competition clauses, the agreement will also provide a rebate scheme for hospital products (5.25%) and biologic medicines (12.5%).
The framework agreement will last for four years, and will take effect starting August 1, 2016.