Supply and Reimbursement
The international research-based pharmaceutical industry 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 patient
The medicine supply chain has three elements:
- The manufacturers, principally members of the Irish Pharmaceutical Healthcare Association (IPHA), who develop, manufacture and bring innovative medicines to the Irish market.
- The wholesalers who store and transport these medicines to hospitals and community pharmacies across the country
- The community pharmacists who dispense the medicine chosen by the doctor for 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 four principal schemes which determine whether people get free or subsidised medicines. They include:
- General Medical Services Scheme (GMS - medical cards) – the patient receives their medicines after paying a 50 cent per item prescription charge (up to a maximum charge of €10 per family per month) and the pharmacist receives a dispensing fee but no mark up.
- Drug Payment Scheme (DPS) – the patient pays a maximum of €120 per 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 such as diabetes, epilepsy and multiple sclerosis 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 approximately 12% and a patient care fee paid monthly to the pharmacist of €60.52. 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 €100 a month of the cost in accordance with the rules of the DPS.
The role of the pharmaceutical industry
IPHA has made successive agreements on the supply of medicines to the health services (Hospitals and Community Drug Schemes).
The latest Agreement which came into effect on the 1st September 2006 runs for a duration of four years. This Agreement through a number of innovative arrangements ensures that patients continue to have access to the most up to date and highest quality medicines when they need them.
On the 1st March 2007 there was a reduction of up to 20% in the price of nearly 600 different packs of medicines on the Irish market. Amongst the packs affected were many leading, long established, post patent medicines. The price of these medicines fell again by a further 15% on the 1st January 2009.
It has been estimated that savings in the order of €300 million across the GMS and community drugs schemes, and in the cost of drugs to hospitals will be achieved over the period of the Agreement .
Also, for the first time, Irish medicine prices are linked with those in Spain and 8 other EU states – Austria, Belgium, Denmark, Finland, France, Germany, The Netherlands, and the UK.
Finally, the Agreement ensures doctors freedom to prescribe any medicine as well as emphasising the crucial role of patients and patient choice in consultation with their doctor.
Updated: 14 December 2009