Pharmacy Daily | Shaw slams generic claims

MEDICINES Australia Chief Executive Dr Brendan Shaw has come out on the attack over proposals from a handful of generic medicines companies for the Pharmaceutical Benefits Scheme which would preference generic brands of medicines over others, calling them “flawed”. “These proposals argue that substituting originator brands of medicines for generic brands will create savings for the PBS,” Shaw said. “That proposition is flawed on a number of fronts,” he added. According to Shaw flaws include the fact that the proposition is based “on the fallacy that generic medicines are cheaper for the Government than their branded equivalents”. “The reality is that the Government pays exactly the same price for branded medicines and generic versions,” Shaw said. “The Government won't save one cent by protecting one group of manufacturers over another group of manufacturers,” he added. Shaw also argued that “protectionism is poor policy and a poor way to run the PBS”, saying that the philosophy is at odds with the “market-based mechanism of price disclosure that is delivering taxpayers $1.9 billion in PBS savings”. Another issue, according to Shaw is that showing preferance to a generic over an originator constrains prescribers and consumers freedom, whilst the proposal is also flawed because it assumes that generics drive price reductions, and that automatically giving these companies market share will provide savings. “Good policy comes from consultation and dialogue between industry and Government, with a long-term framework in mind,” Shaw said. “Half-baked ideas that come from left field are not conducive to such an agreed framework and risk not delivering the savings they promise,” he added. Lastly, Shaw argued that there is already a price signal for consumers to choose a generic medicine over a branded medicine where the branded medicine has a higher patient premium. “Where there is no such premium, as far as the consumer is concerned there is no difference in price between an originator brand or a generic brand,” he said “We have a choice. “Either we can manage the PBS through sensible, long-term agreements negotiated with industry to achieve a sustainable PBS in the future that delivers for consumers, government and industry; or we can run the PBS through a procession of ad-hoc, un-costed, ill-thought through policy and administrative thought bubbles,” he added.

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