Ireland is set to save an estimated €600m on medicines over the next four years thanks to a new price referencing drug cost deal.
The agreement with 38 pharmaceutical companies will see average prices set for high value drugs and medicines, based on the amount paid by 14 European countries, including Germany and the UK.
Irish minister for health Simon Harris welcomed the move saying that not only will it provide greater patient access to new and existing drugs, the deal will also “bring the cost of medicines in Ireland more into line with other European countries”.
Ireland spent approximately €1.7bn on medicines last year. Under the new arrangement the new deal will for the first time see prices will be checked each year – and reduced accordingly – to maintain the lower, averaged cost.
Additionally, drugs that are no longer covered by patent protection will be sold at a 50% discount, while biologics will face an immediate 20% price drop – a tempered discount in order to improve cost-effectiveness but still encourage the market for biosimilar versions of biologics, said a department of health statement.
Beginning from 1 August and lasting until the end of July 2020, the new pricing format also offers hospitals a rebate of 5.25% from 1 June 2016 increasing to 5.5% from 1 August 2018.
Harris commented: “The government wants to ensure that Irish patients continue to have access to new and innovative medicines and that Ireland remains at the forefront of its European peers in terms of early access to medicines in an affordable manner and within available resources.”