APPENDIX 12
Memorandum by Dr David Purdy Nene Valley
NHS Primary Care Group (GD 15)
LOCAL IMPACT OF INCREASES IN THE COST OF
GENERIC DRUGS
I am aware that parliamentary questions have
been tabled in relation to current shortages in the supply of
some commonly prescribed generic drugs, and that the Health Select
Committee has launched an enquiry. I therefore thought that you
would welcome some information related to the impact of this shortage
locally, in terms of projected overspending against drug budgets
in 1999-2000.
The shortage of generic supply in the market
has resulted in us experiencing significant price rises for a
number of commonly prescribed drugs. For example, Frusemide, which
is commonly used in the treatment of cardiac failure has risen
in price by over 750 per cent since April.
Some generic drugs are currently so scarce that
even if a GP prescribes them, they cannot by obtained and therefore
have to be dispensed by the pharmacist in branded form, thereby
increasing overall prescribing costs. For example, metronidazole,
commonly used to treat a variety of infections is currently unavailable
and is therefore often dispensed as Flagyl, which is 759 per cent
more expensive.
What these shortages and cost increases mean
locally is that this PCG is facing an overspend on its prescribing
budget of, if current forecasts prove accurate, anything up to
£137,000. Across Northamptonshire, the total overspend is
projected to be around £1 million. This is despite quite
strenuous efforts by GPs to increase the cost effectiveness of
their prescribing, without which the overspend would be much higher.
The situation is not helped by significant and
increasing delays at the Prescription Pricing Authority in reporting
expenditure to PCGs. The delay is such that we have only just
received expenditure related to prescriptions written in July.
The county's financial recovery plan to save
£5 million was undertaken before the problems with generics
emerged. The generic shortage adds an additional £1 million
of cost pressure to this figure, unless prices ultimately fall
back to their previous level, if and when the supply problems
are resolved. I am chairing a countywide Project Group looking
at modernising prescribing practice in Northamptonshire, and although
we are hopeful of making some significant cost savings from this
work, these will be wiped out by the current level of overspending.
This PCG, like others across the county, is
doing a lot of good work to improve cost effectiveness and drive
up quality in primary care through clinical governance. There
is a real risk that if the generic problem is not resolved quickly,
then the push to modernise the NHS in our area will be slowed
down by both the loss of available revenue, and the loss of support
and commitment from local professionals who will have seen their
efforts come to nothing, as a result of something which is outside
of GP, PCG, or Health Authority control. Essentially, the current
year drug budgets are unmanageable and the emphasis is on damage
limitation.
I am aware that the Department of Health are
looking in to the problem at national level. However, even if
the situation were to be resolved today, there will be significant
cost overruns in 1999-2000, that will need to be funded, both
locally and across the country from 2000-2001 budgets, because,
as I understand, no new money is likely to be forthcoming in this
financial year.
I hope that this letter provides you with useful
background to the problems we currently face. Please do not hesitate
to contact me, if you would like any additional information related
to this issue.
4 November 1999
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