APPENDIX 7
Memorandum by Cambridgeshire Health Authority
(GD10)
Please find attached a report to the Health
Committee expressing our concerns about the shortage of supply
and high cost of generic drugs.
The implications for the NHS are significant.
Of particular concern is the fact that overspend on GP prescribing
expenditure arising as a result of the shortage of supply and
rapid rise in prices, will have to be met through reductions in
other budgetary expenditure, notably hospital and community services.
AVAILABILITY
OF GENERIC
DRUGS TO
THE NHS
Health Committee Review on availability of generic
drugs/Written evidence from five Primary Care Groups (PCGs) in
Cambridgeshire Health Authority/1 November 1999
This response is sent on behalf of the following
organisations:
PCGs are responsible for improving the health
and health services for their local population. This includes
the delivery of primary care services, including responsibility
for managing prescribing expenditure in primary care; and the
commissioning of hospital and community health services.
BACKGROUND
1.1 The prices of generic drugs have soared
in the past eight months. A leading generic producer (Regent GM)
was forced to stop production in February and this has led to
shortages of some products. Other suppliers have struggled to
meet demand and the prices have, therefore, increased.
Table 3
ILLUSTRATES THE INCREASES IN GENERIC DRUGS
| Table 3 | 1998 (based on 1 qtr cost)
| 1999 (based on 1 qtr cost) | 1998 cost per item
| 1999 cost per item | % Increase
|
| £ | £
| £ | £
| |
| Bendrofluazide (2.5mg) | 1,743
| 5,666 | 0.28 | 0.58
| 107.14 |
| Cimetidine (400mg) | 6,077 |
9,969 | 5.91 | 9.44
| 59.73 |
| Dihydrocodeine (30mg) | 5,204
| 8,835 | 2.29 | 3.48
| 51.97 |
| Frusemide (400mg) | 2,612 |
18,994 | 0.53 | 2.46
| 364.15 |
| Metronidazole (400mg) | 491 |
523 | 0.92 | 1.01 |
9.78 |
| Thyroxine (100mg) | 1,391 |
17,455 | 0.21 | 2.05
| 876.19 |
| Total | 17,608 |
61,442 | 10.14 |
19.02 | 87.57 |
| | |
| | |
Source: Prescription Pricing Authority (PPA).
1.2 Supply and costs have also been affected by the new
packaging (28 day blister packs) required by European regulations.
This is predicted to cause an increase of three per cent in the
PCG's drug spend.
1.3 The increase in the numbers of Category D items,
identified by the PPA, highlights the reduced availability of
generic items. In March 1998, 30 items were listed, in January
1999, 50 items were listed, at the end of September the list has
grown to 190 items.
2. IMPLICATIONS
2.1 There are three main implications to the NHS because
of these shortages:
(a) a significant cost implication to the NHS. The shortage
of generic drugs has meant that pharmacists are having to dispense
more expensive alternatives. In some cases a branded drug will
be paid for by the NHS at many times the list price for the generic
version.This represents a massive in year cost pressure for PCGs
to manage, with little financial flexibility available, as the
vast majority of Health Authority resources have already been
committed to "commissioning" services from NHS trusts
with no contingency reserves held. Points to note include:
— the NHS Confederation has established the
cost pressure facing the average PCG because of generic problems
as £250,000;
— local PCGs in southern Cambridgeshire are reporting
forecast overspending on their GP prescribing budgets estimated
by the PPA ranging from £301,000 to £544,000 (July 1999
data);
— the table above shows examples generic prescribing
price increases in the last year. These range from an increase
of + 10 per cent to + 876 per cent;
— PCG GP prescribing budgets have received their lowest
increase for many years.
(b) reductions to hospital and community services to offset
the overspend on prescribing. On 1 April 1999, prescribing expenditure
became part of an integrated allocation for the provision of health
services. An overspend on prescribing expenditure has to be offset
by a corresponding reduction in expenditure elsewhere from within
the integrated budget, the target part being hospital and community
services. The current £2.21 million prescribing overspend
across the five PCGs will have significant undesirable impact
on our ability to maintain the existing range of services, and
this is at a time when there are greater pressures than ever on
delivering services to meet demand, and improve service quality.
This has the potential to damage credibility of both PCGs and
the Government;
(c) lack of availability of specific medicines can result
in patients not receiving the medication considered most appropriate
by their doctor. In most cases, the doctor will prescribe an alternative
drug, but the patient, in this case, will not be receiving the
best medication for their disease. Changing the prescription also
wastes time both for the doctor, and the patient.
2.2 Much work has been done to encourage practice to
prescribe generically, a major focus of the Audit Commission's
Value for Money recommendations, but this good practice is actually
now costing the NHS more.
3. RECOMMENDATION
3.1 That the Health Committee:
— consider the implications of the shortage of supply
and increase in cost of generic drugs;
— recommend actions in relation to the following:
— some form of price regulation should be introduced;
— the clawback of profits, by increasing the discount
factor should be made permanent (approximately 2 per cent);
— "user" representation, notably PCGs, should
be involved in discussions with the pharmaceutical industry or
other appropriate forums;
— better communication from the centre advising of problems
ahead. Very little hard information was received regarding Regent
and generic production problems;
— more timely information from the PPA regarding GP
prescribing spend, information is frequently received between
two to three months in arrears;
— European regulations regarding packaging of drug products
should be reviewed.
29 October 1999
|
