EGA Press Release

Thursday, 6 April 2006

STUDY URGES COHERENT PROMOTION OF GENERIC MEDICINES TO SUSTAIN HEALTHCARE PROVISION

A major new report(1) released today by the Katholieke University of Leuven (KUL) recommends important measures in the EU to ensure the rapid and continued availability of lower-priced generic medicines to patients. If implemented for the top 10 products in each country alone, these measures will lead to savings of up to 48% on pharmaceutical expenditure.

The study, authored by Prof Dr Steven Simoens, professor at the Centre for Drug and Patient Information, Faculty of Pharmaceutical Sciences at KUL, analyses public policy toward generic medicines in 11 EU Member States(2) and their respective levels of generic market penetration. Prof Simoens demonstrates that increased substitution of a generic product over the originator for just 10 active substances would reduce public pharmaceutical expenditure by 27% to 48% in countries like Belgium, Denmark, France, Italy, the Netherlands, Portugal and Spain.

To achieve these benefits, the study emphasises the need for an “actively sustained” generic medicines policy over a period of several years. The study insists that developing a viable generics market requires a coherent generic medicines policy that includes measures in the area of pricing and reimbursement while providing incentives for physicians to prescribe, pharmacists to dispense, and patients to use generic medicines. The best way to achieve the maximum potential of generic competition is by encouraging high volume up-take.

Similarly, the promotion of generics is more successful in countries with relatively free pricing policies for medicines, as in Germany, the Netherlands and the United Kingdom. It urges greater freedom in setting generic medicines pricing and the encouragement of price competition. At the same time, the report denounces the different delays for national pricing and reimbursement approval within the EU as hindering the development of a truly competitive European generic medicines industry.

The study further points out that the traditional instruments used to promote generics — such as reference-pricing systems, prescribing budgets, generic substitution, patient co-payments, information campaigns — can be effective, but must act to stimulate competition and to reward compliance.

The study urges Member States to adopt the following

Seven Policy Recommendations:

1. Introduce a coherent generic medicine policy.
2. Greater freedom in setting generic medicines pricing and encourage price competition.
3. Disseminate information on price differentials to doctors, pharmacists and patients.
4. Increase the confidence of doctors, pharmacists and patients in generic medicines.
5. Provide incentives for physicians to prescribe generic medicines.
6. Remove financial disincentives for pharmacists to dispense generic medicines.
7. Provide incentives for patients to demand generic medicines.

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Footnoots:
(1) Prof Dr Steven Simoens, “Sustaining Generic Medicines Markets in Europe”, Katholieke Universiteit Leuven, April 2006.
(2) The report contrasts six “mature” markets (Demark, Germany, Netherlands, Poland, United Kingdom) with five countries working to develop generic medicines up-take (Austria, Belgium, France, Italy, Portugal and Spain).

Read the Report

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