Future Of Medicines Pricing And Supply Will Be ‘Radically Different’, IPHA Tells NCPE Conference

Posted on May, 15 - 2019

The future of medicines pricing and supply will be radically different to what has gone before - and all stakeholders, especially industry and the State, must be ready to embrace change, the Irish Pharmaceutical Healthcare Association (IPHA), representing pharmaceutical innovators, told a conference hosted by the National Centre for Pharmacoeconomics (NCPE) today [Wednesday].

In a significant policy speech delivered at the NCPE event in Dublin Castle, Aidan Lynch, IPHA’s President, said “the pace of pharmaceutical innovation means that the pricing and supply agreements of the past will not work for the future”.

“The funding requirement to support the introduction of new medicines is going to be greater than the opportunity to save on older medicines,” said Mr Lynch. “Interchangeability and reference pricing will continue to yield savings but on a diminishing basis. Realignment will realise savings in July. The biosimilars policy, once rolled out, will bring about some efficiencies. However, all of these combined will not cover the cost of new medicines. In many cases, these are old technologies. Their patents have yielded returns that have been invested in creating new innovative medicines that more than likely are not going to be in primary care but in specialty medicine. The old will not fully compensate for the new,” he added.

The industry’s four-year agreement with the State on pricing and supply of medicines expires next summer. IPHA has called for a mind-shift in how medicines spending is considered - from “a cost to be written off” to an “investment in outcomes”.

“We need to find new ways of measuring value and outcomes. We must think differently, innovate and work together, sharing information and knowledge. If we are to be consistent from an industry perspective, we should not expect the HSE to pay for new drugs that are not innovative. In today’s world, innovation must be affordable. I, as a taxpayer, do not want the State to pay for anything that does not represent value, whether that’s a building or a medicine,” said Mr Lynch.    

He said there is no “one-size-fits-all” approach to reimbursement, adding that the industry is open to examining “all options”, including looking at European pathways.

“The use of real-world data is increasingly a feature of reimbursement systems. For that to work, there needs to be a willingness on the side of the State and industry to co-create registries and other tools that can be used to demonstrate effectiveness,” he said.

This year, the extra budget for new medicines was just €10 million - less than half of 1% of the medicines budget or 1/20th of 1% of the total health budget. Most other Western European countries allow for a minimum of 2% to 3% growth to allow for demographic pressures and to provide for innovation.

Ireland continues lag other western European countries on speed of access to innovative medicines. On World Health Day, IPHA published European data, based on 27 countries, that examined the wait times and rates of availability for 121 products licensed by the European Medicines Agency in 2015, 2016 and 2017. When it came to the availability of new medicines, we ranked 16th. Just 42% of new medicines licensed over the three years were available and reimbursed here last year. We ranked 20th out of the 27 countries for speed of access with Irish patients waiting, on average, 486 days for some new medicines.