Usage of generics in Ireland: Recent trends and policy developments

Abstract

In 2011, the Irish State spent €1.9bn on pharmaceuticals, amounting to approximately 13% of total public health expenditure. Over the period 2000–2010, Ireland experienced one of the fastest growth rates in per capita pharmaceutical expenditure in the OECD. Concern over pharmaceutical expenditure in Ireland has led to a number of policy changes, targeting primarily the price of pharmaceuticals. More recently, there has been much concern over the low rates of generic usage in Ireland. In 2009, 34% of multiple-source off-patent pharmaceuticals dispensed under the main State pharmaceutical reimbursement schemes in Ireland were generics, in comparison with 71% in the UK. Up to now, the potential for significant savings through the increased use of generics in Ireland has been limited as the price of off-patent pharmaceuticals (including generic pharmaceuticals) was set at a small discount to the patent-holder price. Legislation to introduce a system of reference pricing and generic substitution for 20 leading off-patent pharmaceuticals has recently been enacted. However, reference prices have yet to be set, and so the full scale of any potential savings under the Health (Pricing and Supply of Medical Goods) Act 2013 has yet to be determined. In advance of the new legislation, there has been evidence of a substantial increase in the use of generics in Ireland, although the precise reasons driving this increase are unclear.