Driving Change - The Health (Pricing And Supply Of Medical Goods) Act 2013

Author:Mr Michael Finn and Paul Clifford


In recent years, there has been extensive review and scrutiny of the state's healthcare budget, not least its expenditure on medicines. On May 28 2013 the president signed the Health (Pricing and Supply of Medical Goods) Act 2013 into law. Although it has been stated that this act is not a "charter for cheap drugs", it is widely recognised as the latest in a series of initiatives aimed at controlling the state's overall expenditure on medicines.

Traditionally, generic medicine penetration has not been high in Ireland. Generics currently account for approximately 18% of all medicines prescribed. The Department of Health has indicated that this rate is particularly low when compared to the current UK rate of approximately 83%. To bring Ireland into line with its European counterparts, the act introduces a system of generic substitution and reference pricing.

Substitution of 'interchangeable' medicines

Generic substitution enables pharmacists to substitute a cheaper generic medicine when a more expensive branded medicine has been prescribed. The Irish Medicines Board (IMB) has the task of deciding which medicines are interchangeable and compiling an online list. The act sets out the criteria to be considered by the IMB. Medicines may be considered interchangeable if the IMB is satisfied that the products have:

the same active ingredients, in terms of qualitative and quantitative composition; the same (or appropriately substitutable) pharmaceutical form; and the same route of administration. Importantly, the act also sets out circumstances where medicines are not interchangeable, including, among other things:

where there is a difference in bioavailability between products, which may lead to significant differences in efficacy; where the product contains more than two active substances; where the device for administering the product has significantly different instructions; where the product is a biological entity; or when the product cannot be safely substituted. The act puts in place the building blocks for substitution. However, it will have no effect in the marketplace until the IMB has published its list of interchangeable medicines. The IMB had already started work on identifying classes of interchangeable medicines before the act was passed. It is prioritising the most expensive classes of product, including statins, proton pump inhibitors, angiotensin-converting-enzyme inhibitors and angiotensin II receptor...

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