On the face of it, the new deal between the Government and the pharmaceutical industry is a good one. The four-year deal promises to deliver savings of €750 million on the State’s drugs bill, providing an opportunity for the Health Service Executive (HSE) to pay for future, innovative treatments.
The broadening of the “basket” of countries against which drug prices here will be benchmarked, to include lower cost markets such as Italy, Greece and Portugal, will help bring costs nearer to a European average. And the immediate halving of the cost to the State of drugs that come off patent is another significant and welcome step forward.
However the Framework Agreement on the Supply and Pricing of Medicines offers some hostages to fortune. Despite the deal having been negotiated by his department, Minister for Health Simon Harris expressed reservation about the retention of a system whereby the ultimate decision about the funding of expensive new treatments lies with the Cabinet. Tellingly he said: "I certainly would like if my family relative was ill that decisions [on funding innovative treatments] would be made by the clinicians."
By not addressing this issue, the new deal does no more than defer grasping a challenging nettle: ultimately, because of the inexorable rise in health care costs, the approval of more expensive drugs will involve a cut in services elsewhere in the system.
Many of the new treatments coming on stream work by modifying the immune system. The originals of this species of drugs are coming off patent, yet the new deal limits the savings on generic “biosimilars”. Manufacturers of generic drugs, who are not part of the new deal, say an “artificial pricing clause” in the agreement makes it uneconomic for biosimilars to enter the Irish market.
A breathing space on drug prices provided by the new deal must be used to undertake a national debate on how we wish to ration healthcare resources. It deserves to be first item on the agenda of the new all-party committee on health.