Laura Slattery asks why a generic drugs industry is flourishing elsewhere but not in the Republic
For the occasionally, not so seriously sick, pharmacies are warm places, filled with a sense of relief. At last there's a diagnosis, now all we need is the pill to make us feel better.
It is not until after the pharmacist has dispensed the exact quantity of medicine we need, printed off a label, given us dosage instructions and rung it all up on the cash register that patients discover the price of getting better. By this stage, it's unlikely we're going to berate our local pharmacist for depriving us of our last €50. And anyway, if our doctor says this drug is the drug we need, then we need it, right?
Not always, according to the National Centre for Pharmacoeconomics (NCPE), which has produced a report revealing that in 2003 over a fifth of prescription items were dispensed as proprietary, ie brand name drugs, when a cheaper, generic version of the drug was available.
"It's prescribing habit, isn't it," says Dr Michael Barry, clinical director of NCPE, a Government-funded body that lists the development of cost-effective prescribing among its aims. The NCPE is concerned that the generic drugs market, a flourishing industry around the world, is yet to be embraced here. Less than 10 per cent of prescriptions in the Republic are for generic drugs, compared with over 50 per cent in the UK and Germany.
For the Government, which in 2003 spent €943 million reimbursing pharmacies for medicines dispensed under community drugs schemes such as the General Medical Services (GMS) medical card scheme and the Drugs Payment Scheme (DPS), generics could help control costs.
According to the NCPE, seven of the 30 most costly drugs dispensed to medical cardholders have a generic equivalent. If the cheapest generic drugs were prescribed, it would knock €12.7 million off the Government's annual drugs bill. It's a similar story on the DPS: substituting the eight of the top 30 drugs that have generic equivalents would save €9.1 million annually.
"Generic substitution," whereby a pharmacist can or might be obliged to dispense the cheapest generic even if the doctor has prescribed the original brand, is one issue the Department of Health should examine, Dr Barry believes. In countries where it has been introduced, doctors are given the option to insist on a branded drug by ticking a box on the prescription form, he notes, although they tend not to in most cases.
There is an argument that doctors might not always have up-to-date price charts of all the generics available on the market, he adds, but it would be feasible for pharmacists to keep track. At the moment, pharmacists can legally dispense only what the doctor prescribes.
The Irish Pharmaceutical Union (IPU), which represents more than 1,600 pharmacists, is in favour of pharmacists having the right to prescribe generics but against any legislation making it mandatory to provide the cheapest version of a drug.
IPU president Dr Karl Hilton gives the example of an elderly lady who was prescribed the generic version of a blood pressure tablet for the first time. The generic version of the drug was the same as the branded drug in every way but two: it was cheaper and it had an orange-coloured coating. "Four or five months later it transpired that she had not taken the medication, because she had had a bad allergic reaction in the past to a tablet with an orange colour," he says.
At the heart of the debate is a battle for patient care. Doctors, especially those who view pharmacists less as healthcare professionals and more as retailers, may be uneasy at the thought of their instructions being overruled.
Dr James Reilly of the Irish Medical Organisation (IMO) believes the indicative drug budgeting scheme is the best way to increase awareness of generic alternatives.
But the scheme, which encourages GPs to keep prescribing costs for medical card patients down by rewarding them with capital funding for their practices, needs to be promoted again with doctors given budget targets, he says.
All prescribing powers should definitely remain with the doctor. "In relation to devolving that right to the pharmacist, I see further problems with patients accepting the generic medicine," Dr Reilly says. "On occasion, patients don't feel right taking the generic drug. They get a mild reaction. They shouldn't - it's inexplicable, because it is the same drug - but they do."
As a result, doctors need to ensure that patients with long-term conditions like high blood pressure, asthma and heart disease take the same brand of drug, be it a branded generic or the original product, continuously. Prescriptions shouldn't change in tandem with temporary fluctuations in drug prices, he adds.
In any case, generic substitution can only curb the Republic's spiralling expenditure on drugs so far. "We don't feel there is a pot of gold there," says Dr Hilton. "These savings, though they are reasonable, are not going to be a huge percentage of the overall cost of drugs. Generic substitution on over 60 per cent of drugs is impossible."
The tendency for generic copies to be priced just below the original brand also limits savings, although in some countries prices are regulated. In France, generics must be priced at 30-40 per cent less than the original brand.
The cost of medicines to the State is determined by an agreement between the Department of Health and the Irish Pharmaceutical Healthcare Association (IPHA). Under the agreement, which is due to be reviewed in the summer, the "factory gate" prices of drugs in the Republic is the lower of two numbers - the wholesale price in the UK or the average of wholesale prices in five countries: Denmark, France, Germany, Netherlands and the UK.
Critics of the agreement question why these particular countries are used as a benchmark. Why not include Spain or Portugal, where drug prices are far cheaper?
But the authors of several reports save most of their ire for a practice whereby the State pays pharmacists a 50 per cent mark-up on all medicines dispensed under the drugs payment and long-term illness schemes (see panel). Pharmacists are thus in the rather unique position of having a profit margin guaranteed by the State.
According to a study published by Trinity's Policy Institute and written by the Competition Authority's director of advocacy, Declan Purcell, the Republic has the highest retail margins on medicines in Europe at 33 per cent.
As the pharmaceutical industry and pharmacists' biggest customer, the Government is the first to lose out.
By extension, taxpayers, the DPS patients who have faced repeated hikes in their monthly payments and the near 40 per cent of the population that does not qualify for any State reimbursement, are also in their thrall.