Health (Pricing and Supply of Medical Goods) Bill 2012

Róisín Shortall T.D., Minister of State with responsibility for Primary Care in the Department of Health, today (Monday, 16th July 2012) announced the publication of the Health (Pricing and Supply of Medical Goods) Bill 2012. The Bill will be introduced in the Seanad in the coming days.

The Bill provides for the introduction of a system of generic substitution and reference pricing.

Currently, when a specific brand of medicine is prescribed for a patient, a pharmacist can only supply that particular brand, even when less expensive generic versions of the same medicine are available. The Bill permits pharmacists to substitute medicines which have been designated as interchangeable by the Irish Medicines Board.

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.

Reference pricing involves the setting of a common reimbursement price, or reference price, for a group of interchangeable medicines. Eligible patients 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.

The Bill also sets out statutory procedures governing the supply, reimbursement and pricing of medicines and other items to patients under the GMS and community drugs schemes. The Bill will allow the HSE to attach conditions to the supply of certain items, provided that any restrictions are evidence-based and in the interests of patients and ensuring value for money.

These measures will promote price competition and deliver lower medicine prices for both the State and patients.

ENDS

Notes to Editors:

Please find below a list of Frequently Asked Questions on the Health (Pricing and Supply of Medical Goods) Bill 2012:

A. Status, main elements and purpose of Bill

What is the status of the Bill?

The Bill was published on Friday, the 13th of July 2012 and will be initiated in the Seanad on the 19th of July.

What are the main elements of the Bill?

The Bill provides for the introduction of a system of generic substitution and reference pricing.

What is the purpose of the Bill?

The main objectives of this Bill are to promote competition between suppliers of interchangeable medicines and to ensure value for money in the supply of medicines and other prescribed items to patients under Section 59 of the Health Act 1970.

B. Generic substitution

What is generic substitution?

Generic substitution allows pharmacists to dispense a different version of a medicine when a specific brand has been prescribed.

What is a generic medicine?

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.

Why do generic medicines look different?

Generic versions of a medicine may have different colours, flavours or combinations of non-active substances compared to the original product. A generic medicine may also be a different shape or size and come in a different box, package or bottle. None of these differences, however, affect the way the medicine works.

Are generic medicines lower quality?

A generic medicine must meet exactly the same standards of quality and safety and have the same effect as the original medicine.

Does every medicine have generic versions?

Not every brand-name medicine has a generic version. When new medicines are first made they are protected by patents for a number of years. The patent, which protects the company that made the medicine first, doesn't allow anyone else to make and sell the medicine. When the patent expires, other medicine companies can start selling generic versions of the medicine.

What is an interchangeable medicine?

Interchangeable medicines are those that have the same qualitative and quantitative composition in each of their active substances, are in the same pharmaceutical form, and have the same route of administration.

Who decides if a medicine is interchangeable?

The Irish Medicines Board (IMB) will have responsibility for deciding if a medicine is interchangeable or not.

When might a medicine not be interchangeable?

Medicines will only be substituted where it is safe to do so. A prescriber will be able to indicate on a prescription when substitution should not take place, if there are clinical reasons for this.

Can every medicine be substituted?

No. For a small number of products, it is not advisable for patients to switch between different brands. Pharmacists will only be able to substitute medicines that have been designated as interchangeable. Substitution will only be allowed where it is safe to do so.

Is there a list of interchangeable medicines?

The Irish Medicines Board will establish a list of interchangeable medicines which will be published and kept updated on its website.

Can I opt for my usual brand of medicine and not the generic?

You can choose your usual brand of medicine if you prefer (see section C for price implications).

C. Reference pricing

What is reference pricing?

Reference pricing sets a common reimbursement price for groups of interchangeable medicines.

Will I have to pay more for my usual brand of medicine?

Eligible patients will not be required to pay any additional costs for medicines priced at or below the reference price. If a patient chooses a particular brand that is more expensive than the reference price they will have to pay the difference.

What happens if I need to receive a particular brand of medicine for medical reasons?

Your prescriber will be able to state on the prescription that that particular brand is to be provided. If that particular brand costs more than the reference price you will not have to pay the difference.

Do other countries use reference pricing and generic substitution?

Yes. Many European Member States have systems of reference pricing and generic substitution. Similar systems are also in operation in Canada, Australia and the United States.

Who decides the reference price?

The HSE has responsibility for setting the reference price. It does this in accordance with certain criteria, in particular, securing value for money for the taxpayer. It will also have to have regard to the need to ensure that prices are not set so low as to render their sale uneconomic as this could impact on their availability on the Irish market.

D. Reimbursement List

What is the reimbursement list?

The Bill provides for the establishment and maintenance, by the HSE, of a reimbursement list. This is a list of all the medicines or other items (e.g. dressings) that are provided by the HSE under the General Medical Services Scheme or Drug Payment Scheme.

Will the Bill affect the current supply of items?

No. All items will automatically transfer but the HSE has the right to review an item at any stage.

Can changes be made to the reimbursement list?

The Bill provides for the list to be reviewed by the HSE within 3 years (or 5 years if the Minister permits it). However, the HSE may also review a listed item at any time in accordance with the legislation.

What is meant by the conditional supply of listed items?

The Bill allows the HSE to attach conditions to the supply or reimbursement of items on the reimbursement list, in the interests of various factors, such as, patient safety and cost-effectiveness.

Can new drugs be added to the reimbursement list?

Yes. The supplier of an item may apply to the HSE to have it included on the list.

Can an item be supplied if it is not on the reimbursement list?

Yes. Subject to certain conditions, the HSE has the discretion to supply an item that is not on the list if it meets particular criteria.