Supply and Reimbursement
The Irish Pharmaceutical
Healthcare Association (IPHA) has worked for a long number of years with the
State to ensure that in Ireland we have a single tier system of access to
medicines, whereby all patients, regardless of income have access to the
medicine which their doctor believes is best suited to their needs.
How medicines get to the
The medicine supply chain has 3
• The manufacturers, principally members of
IPHA, who develop, manufacture and bring innovative medicines to the Irish
• The wholesalers who store and transport
these medicines to hospitals and community pharmacies across the country.
• The community pharmacists who dispense
the medicine to the patient.
How medicines are payed for
In Ireland, the State pays for
approx. 80% of all medicines. The ultimate cost to the State of medicines
dispensed in the community depends on which community medicine scheme the
patient uses to access the medicines. There are 4 principal schemes
which determine whether people get free or subsidized medicines:
• General Medical Services Scheme (GMS -
medical cards): the patient
receives their medicines after paying a €2.50 per item prescription charge
(up to a maximum charge of €25.00
per family per month) and the pharmacist a dispensing fee but no mark
• Drug Payment Scheme (DPS): the patient pays a maximum of €144/month
for medicines, the pharmacist receives both a mark-up and a dispensing fee.
• Long Term Illness Scheme (LTI): the patient receives medicines for
specific conditions (e.g. diabetes, epilepsy) free of charge. As with the DPS
the pharmacist receives a mark-up and a dispensing fee.
• Hi-Tech Scheme: the cost of these medicines is comprised of the ex-factory price,
in line with the IPHA/HSE Agreement framework, a wholesale mark up
of approx. 10% and a patient care fee paid of €62.03 paid to the pharmacist in
the month when an item dispensed and €30.26 paid in months where no item is
dispensed. Where the patient has a medical card or the medicine is for a
specific condition covered by the LTI they do not pay anything, otherwise they
pay the first €130 a month of the cost in accordance with the rules of the DPS.
The role of the pharmaceutical
The supply of medicines to the
health services has been governed by a series of agreements between the State
and the IPHA, on behalf of the international research-based pharmaceutical
agreements through a number of innovative arrangements ensure that patients
continue to have access to the most up to date and highest quality medicines
when they need them.
For many years, a structured
and transparent process has overseen the supply of innovative medicines in
Ireland. This has served the State and patients well.
The pharmaceutical industry
has recognized that the State faces particularly tough challenges in funding
healthcare and has agreed robust, cost effective arrangement for the supply of
medicines to the health services. These arrangements have resulted in savings
of €600 million in the State medicines bill since 2006, providing the State
with monies to fund new therapies which offer hope to patients of longer,
healthier and more active lives.
In October 2012, IPHA reached
a new 3 year agreement with the Department of Health on the supply of medicines
which will yield in excess of €400 million in savings to the State. This
is extremely good news for the State, patients and taxpayers, as the price of
hundreds of medicines will fall significantly. As well as offering
substantial price reductions, the industry agreed a process to ensure that
Irish patients will have timely access to new products over the period of the
Agreement and will not be disadvantaged by current fiscal difficulties.
The main elements of the
• The Agreement will run for 3 years and will ensure that Irish
patients have timely access to new products over this period and are not
disadvantaged due to the current fiscal difficulties.
• On patent expiry, the price to the wholesaler of a medicine will be
reduced to 70% of the original price. 12 months following this price reduction,
the price to the wholesaler will be reduced to 50% of the original price.
• For existing patent expired medicines, the price to the wholesaler will
be reduced to 60% of the original price on 1st Nov. 2012. This will be followed
by a further reduction to 50% of the original price to the wholesaler 12 months
• A once off downward price realignment will apply to the
currency-adjusted average price to the wholesaler in the nominated EU member
states on patent medicines and off patent unique medicines.