Select Committee on Health Minutes of Evidence

MEMORANDUM BY SHROPSHIRE HEALTH AUTHORITY

PRESCRIBING BRIEFING (GD2)

BACKGROUND

  The primary care drug budget for Shopshire is £42 million. PCG and practice drug budgets for 1999-2000 were based upon historic spend uplifted by 7 per cent to take account of increase in prescribing costs, adjusted according to the practice potential to make savings.

  This gave PCGs a realistic budget on which savings could be made. However the PPA are predicting an overspend on the drug budget of £1.55 million, due primarily to the increase in the cost of generic products.

  Telford & Wrekin PCG has a population of approximately 150,000 and is predicting to overspend the PCG Primary Care drug budget by more than £500,000.

1.  GENERIC PRESCRIBING

  Percentage Generic prescribing has been highlighted as an "Efficiency Target" in the recent Department of Health "Quality in the NHS—High Level Performance Indicators" and is the major target for all PCG Incentive Schemes in Shropshire: See Attachment D.[1]

—  The increase in the cost of generic drugs and Category D changes in the Drug Tariff has reduced the possible savings in this area for Shropshire by more than 25 per cent (see attached graphs and table A,B,C).

—  Where calculations have been done on this, it appears that the increased costs of generic drugs may add 5-7 per cent to the total drug bill, depending upon the practice/PCG percentage generic prescribing.

—  This increase is unlikely to be off-set by the 4.33 per cent reduction in branded product prices negotiated through the PPRS as companies appear to have been able to select:—

—  less commonly used products within a drug group eg fluticasone 125mg inhaler rather than higher strengths

—  products which are about to lose their patent and therefore a generic (cheaper) product would become available anyway

—  Some products which may only be used in secondary care and make no savings in primary care.

—  The increase in generic prices has come about through unavailability of products and has caused problems in supply for pharmacists and dispensing doctors. The way such prescriptions have to be endorsed before submission to the Prescription Pricing Authority (PPA) has led to a reduction in the actual percentage generic medicines prescribed by some dispensing practices, so disadvantaging them in the Incentive Scheme.

—  12 of the 13 Health Authorities in the West Midlands are expecting to overspend their prescribing budgets (by between 0.6 and 10.5 per cent). This will severely reduce the PCG scope for developments next year.

—  The increased cost of generic drugs has reduced the savings identified in the Health Authority Prescribing Action Plan and Medicines Management Section of the Health Improvement Programme by several hundred thousand pounds, hence less money to invest in other areas of prescribing.

2.  HEALTH AUTHORITY CONCERNS

  Potential loss of financial control because of information time lag and lack of incentives for GPs.

  Impact on PCG budgets and development plans for 2000-01.

  Risk of technical difficulties with closing the account for 1999-2000 and reconciling income and expenditure and cash because of the delay in PPA information.

  Erosion of incentive for high generic prescribing thereby reducing the practices ability to meet the targets for the PCG Prescribing Incentive Scheme.

Patricia Campbell

Pharmaceutical Adviser

Shropshire Health Authority

	Cost for 28 Days Supply of Drug
Drug Name and Strength	Sept 98	Dec 98	Mar 99	June 99	Sept 99	% Increase Sept-Sept
Atenolol 50 mg	90p	87p	102p	122p	146p	62
Atenolol 100 mg	122p	117p	136p	157p	192p	57
Thyroxine 50 mg	19p	24p	44p	79p	87p	360
Thyroxine 100 mg	21p	24p	67p	144p	162p	670
Warfarin 3 mg	82p	76p	106p	158p	170p	107
Warfarin 5 mg	121p	126p	160p	258p	276p	128
Bendrofluozide 5 mg	15p	15p	15p	32p	100p	567
Bedrofluozide 2.5 mg	15p	15p	18p	32p	86p	473
Asprin 300 mg	12p	13p	13p	13p	13p	8
Frusemide 40 mg	26p	28p	28p	193p	214p	723
Amoxycillin 250 mg (15)	47p	47p	71p	83p	169p	260
Amoxycillin lig 125 mg/ml/100 ml	91p	96p	103p	107p	134p	48
Amoxycillin lig 250 mg/ml/100 ml	153p	162p	174p	181p	225p	48

---

1  Not printed. Back

---

Prepared 21 December 1999