Paul K Gorecki ESRI amp TCD Irish Economic Policy Conference 2014 Economic Policy After the Bailout Institute of Bankers IFC Dublin 31 January 2014 STRUCTURE OF PRESENTATION 2010 What was the problem ID: 734905
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Pricing Pharmaceuticals: Has Public Policy Delivered?
Paul K Gorecki
ESRI & TCD
Irish Economic Policy Conference 2014: Economic Policy After the Bailout
Institute of Bankers, IFC, Dublin
31 January 2014 Slide2
STRUCTURE OF PRESENTATION
2010: What was the problem?
2013: Towards a successful resolution?
Two Observations on 2010-2013Future Policy: What Remains to be Done?
2Slide3
Ireland High & Rising Pharma
Expenditure:2010
Ireland’s Ranking in
PharmaceuticalExpenditure Per Head Cp
Other OECD Countries:
2000 – 20
th highest of 27 OECD countries 2005 – 9/31 2010 – 3/25
US PharmaceuticalExpenditure Per HeadSet = 100, then Irelandwould be as follows: 2000 – 46 2005 – 58 2010 - 70
3Slide4
High Input & Mediocre Outcome:2010
“In 2010, per capita expenditure spending on
pharmaceuticals in Ireland was the highest in
the EU, 34% above the average, while health
outcomes are not better than the average for
EU countries over a range of high-level
indicators.” European Commission, EconomicAdjustment Programme
for Ireland, Autumn2012.4Slide5
Pharmaceutical Prices: 2010
Generic pharmaceuticals:
Low generic usage cp other MS
High generic prices cp to other MSNew pharmaceuticals:
Consistently high prices cp to other MS
Germany only MS consistently higher prices
Framework for Pricing Decisions:Voluntary DoH/HSE & industry agreementsNo legal basis for generic substitution
5Slide6
Pharmaceutical Pricing: 2013
Framework for Price Setting
Health (Pricing & Supply of Medical Goods) Act 2013
Generic Pharmaceuticals (28% expenditure)
Generic substitution permitted
IMB certified 13 active substances (
statins, ACE inhibitors)
HSE has set reference price for two drugs (atorvastatin, esomeprazole), large decline in priceNew Pharmaceuticals (72% expenditure)Stock -HSE rolling assessment as per the Act (pregabalin)Flow – default status quo or use of Act’s powers?
6Slide7
Two Observations on Pharmaceutical Pricing: 2010-2013
DoH
/HSE strategy since 2009 to reduce pharmaceutical expenditure
through eg reductions in wholesale & pharmacy margins.
2010 – 2013
favourable
conditions for reform of pharmaceutical pricingAgreement on problem/solutionAusterity – greater emphasis on VFMEU-IMF Programme
for Reform for Ireland 7Slide8
Future Policy: What Remains to be Done?
Building on the
Health (Pricing & Supply of Medical Goods) Act 201
What is DoH/HSE policy towards pricing of new drugs?
Release on a monthly basis PCRS data
Quality Adjusted Life Year (QALY)
Is €45,000 threshold the right price?If so, under what conditions, if any, should the threshold be exceeded?
8Slide9
Further reading
P.
Gorecki
, A. Nolan, A. Brick & S Lyons (2012) Delivery of Pharmaceuticals in Ireland. Getting a Bigger Bang for the Buck. RS 24. Dublin: ESRI.A. Brick, P.
Gorecki
& A. Nolan (2013
) Ireland: Pharmaceutical Prices, Prescribing Practices and Usage of Generics in a Comparative Context. RS 32. Dublin: ESRI.
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