Government proposes maximum price for four generics recently off patent
Generic simvastatin has been heavily marketed recently |
Maximum prices for generic versions of doxazosin, omeprazole, lisinopril and simvastatin are proposed for England and Wales by the Department of Health, from 1 December. Patents on these medicines expired during the past two years and they have recently been the subject of considerable marketing activity.
In a consultation paper issued last week, the DoH says that the margin
available on these medicines is not part of the current discount recovery
calculation, which is based on a discount inquiry undertaken in October
2000. With many generics companies producing versions of these products, “there
are currently significant differences between the reimbursement prices
and the procurement prices available to community pharmacy contractors,” the
DoH says. It adds that the present margins do not meet its objective
of obtaining reasonable value for money from the existing reimbursement
system.
A new system for reimbursing contractors for generic
medicines is to
be introduced in April 2004 (PJ, 6 September, p285). As a result, no
discount inquiry is to be held at present because the results of the
inquiry would not be available until after the new system started.
Sue Sharpe, chief executive of the Pharmaceutical Services Negotiating
Committee, said: “A significant concern of the Department of Health
has been the relative insensitivity of the present arrangements to price
drops after a molecule comes off patent, and these proposals reflect
its wish to make adjustments to the prices of four molecules that are
recently patent-expired.
“The PSNC will discuss these proposals with the DoH in the context
of wider debates on future generics pricing mechanisms and funding for
community
pharmacy services. We have been working hard to prevent ‘cherry-picking’ in
our discussions on funding issues, but we acknowledge that the differentials
between Drug Tariff prices and purchase prices available in the market
have given rise to concerns, not least among primary care trusts whose
drug budgets are under great pressure. These concerns have contributed
to the development of arrangements that undermine the systems in place.”
The Journal understands that the PSNC has written to a number of PCTs
about arrangements being made for recommending and purchasing branded
generics. These letters are believed to raise concerns about PCTs’ compliance
with appropriate European Union procurement rules governing the placing
of high-value contracts.
Mrs Sharpe added that the PSNC is establishing an agreed evidence base
for determining the funding needed for pharmacy contractors. “Pharmacy
contractors depend on purchase profits for essential income, and this
has now been acknowledged by the DoH.”
Comments on the DoH proposals can be sent to Eunice Barnor, Room 138A,
Department of Health, Richmond House, 79 Whitehall, London SW1A 2NS (e-mail
generics@doh.gsi.gov.uk with “Reimbursement prices of four generic medicines” as the subject line) by 7 November. |
