Parliament must make right decision on generic medicines
EUROPEAN citizens are very familiar with generic medicines in the self-medication area, in which payment is made directly out of their pocket, for example preferring a competitive-priced generic paracetamol over branded Panadol for pain relief, or generic loratadine as opposed to Claritin for tackling hay fever or allergies.
By Greg Perry
However, in the prescription medicine area covering critical illness – where costs are mostly met indirectly by health insurance and tax contributions – off-patent generic medicines play an even more crucial role. Generic medicines currently generate l13 billion in savings each year for EU health care systems.
If generic medicines were taken out of the health economics equation, the Union's health care systems would rapidly become financially unsustainable.
Although most EU governments have started to see the benefit of increased use of generic medicines, the potential for more cost-effective medicinal provision in Europe's off-patent market is tremendous. As a percentage of all medicinal products dispensed in the European Union, generic medicines still only amount to 15-17%. This is a huge difference when compared to the US figure of 50-60%.
The next few years will provide a major opportunity for more affordable health care in Europe, as 35% of the top-selling pharmaceuticals will be patent-expired by the end of 2004.
Focus in the future will be directed towards competitive bio-generic/'bio-similar' medicines. Importantly, EU medical experts have given the green light to the development of these new competitive medicines.
Too many people still maintain the old-fashioned belief that any form of competition from generic medicines is bad news for originator companies. But, as recent thinking demonstrates, this is far from the truth. Increasing generic competition after patent expiry is now seen as an important instrument for promoting pharmaceutical competition, innovation and employment in the EU.
This was strongly emphasized by the G10 high-level group on medicines in its report of May 2002, which called upon member states to introduce measures "to secure a competitive generic market in Europe".
Moreover, it is now recognized that lack of pharmaceutical innovation in Europe is not due to a lack of market protection. It is caused by a number of other problems, such as price restraints on in-patent products, unnecessary delays in market access, undercutting of revenues for in-patent products by parallel imports and, particularly, a lack of public investment in pharmaceutical research.
Policymakers in Europe are now looking at measures, both at EU and national level, to increase the availability of generic medicines to patients. At the G10 workshop on generic medicines held in Lisbon in February, it was agreed that at national level generic prescribing and dispensing, consumer awareness and price competition are key national polices needed to stimulate generic competition.
Of critical importance at the time of writing, is that MEPs and governments also create the right EU regulatory environment to ensure the rapid availability of generic medicines.
This is the foundation stone for the future – get this wrong and the rest does not fall into place. The EU regulatory framework in the current pharmaceutical review should be based on the following four main measures:
Ensuring that generic medicines are available immediately after patent expiry, ie no excessive data exclusivity;
encouraging generic R&D before patent expiry;
providing a regulatory system for bio-similar medicines, and;
resisting the pressure from originator companies to change the scientifically based definition of generics in the Council of Ministers' common position, which was agreed by experts from all 15 member states.
MEPs will vote on the pharmaceutical package next Tuesday (16 December). The right of Europe's 450 million citizens to enjoy affordable health care depends on them making the right decision.
Greg Perry is director general of the European Generic Medicines Association and a member of the management board of the International Generic Pharmaceutical Alliance.
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