Prices of generic medicines have been slashed

The price of generic medicines on the Pharmaceutical Benefits Scheme is already being reduced by as much as 70 per cent, despite claims in this morning’s press to the contrary, Medicines Australia chief executive Dr Brendan Shaw said today.

Dr Shaw was responding to an article by Professor Philip Clarke in this morning’s Australian Financial Review titled “Time to slash cost of generics”.

“I’m not sure if Professor Clarke has been asleep for the past four months but a major reform to the PBS was passed by the Parliament in November and is already slashing the cost of off-patent medicines,” Dr Shaw said.

“The system of mandatory price disclosure was legislated last year as part of the Memorandum of Understanding between Medicines Australia and the Commonwealth precisely because of the need to drive savings through a competitive generics market and ensure the sustainability of the PBS.

“The system forces companies to disclose the discounted price at which they are selling medicines to pharmacy, allowing Government to adjust the price it pays to the price the medicine commands in a competitive market place.

“For example, in the latest round of price disclosure cuts the cost to Government of cancer medicine oxaliplatin will fall by 70 per cent. Cuts on other medicines will range between 10 per cent and 45 per cent.

“These reforms are achieving precisely what they were designed to do – to realise the kind of savings that other countries have been able to drive.

“The problems of expensive generics have been acknowledged by the industry and by Government. They have been fixed and substantial savings are starting to flow.

“I’m not sure if the professor has been in a time warp while PBS reform was being delivered, but prices are falling dramatically and PBS expenditure growth is now at its lowest for 15 years.

“Comparisons with other countries like Canada don’t stack up either. The healthcare system operates very differently in that country. In fact, Canada spends more on pharmaceuticals as a proportion of GDP than does Australia.”

–ENDS–

Contact Person:

Jamie Nicholson
Media Communications Manager
Phone: 0419 220 293
Email: Jamie.Nicholson@medicinesaustralia.com.au