A new deal to cut the amount the State pays for medicines by at least €750 million over the next four years will be announced on Wednesday.
Minister for Health Simon Harris is expected to announce the agreement at Government Buildings at midday.
The drugs saving agreement with the pharmaceutical manufacturers would include revised rules on the approval of new drugs.
For the first time some high-cost drugs would be referred to Cabinet for a funding decision, according to reports.
The effect of the deal will be to ensure there is no increase in the State’s €1.2 billion annual drugs bill over the next four years.
This would allow for extra funding to be spent on new drugs currently in the pipeline.
The cost of drugs in Ireland relative to other countries will fall, through the expansion of the basket of countries in which Ireland is grouped for price-setting purposes.
Irish prices are pitched at an average of nine countries, but under the new agreement this basket is being increased to include at least 14 countries.