Generics Ride the European Budgetary Control Wave

More bad news for some can be more good news for others – and the European generic medicines industry was quick to seize an opportunity to strut its stuff when depressing advice emerged from Brussels in late May on the need to control healthcare spending.

As soon as the European Union's glum 2017 prognostications for public finances hit the streets, the European generic drug industry association (recently rather presumptuously rebranded as 'Medicines for Europe') issued its own take on the analysis.

The EU's recommendations to member countries "highlight the inefficiencies in several European healthcare systems particularly regarding the low access to medicines for patients," said Medicines for Europe (MFE), in a press release. But never fear, it went on: "Generic and biosimilar medicines provide an outstanding opportunity to improve access to safe and effective medicines through efficient medicines policies."

The trigger for this adroit piece of self-publicity was the publication by the European Commission of a country-by-country series of recommendations about getting public spending under control, as part of the EU's now annual budgetary exercise, known as the EU Semester. These recommendations are made on the basis of a Commission assessment of every aspect of public spending in each of the 28 member states – and since healthcare represents a big chunk of every country's budget, it obviously comes in for scrutiny.

By way of example, the Commission said of Ireland that despite its recent attempts to battle with high drug prices, "more could be done" and the country "should particularly address the cost-effectiveness of the health sector" - for instance "by strengthening the role of primary care as a gatekeeper for Ireland’s overburdened hospitals."

Austria was told to take rapid action to ensure the sustainability of its healthcare system, by mastering high spending in the hospital sector, making better use of outpatient care, and striking deals with healthcare suppliers based on public procurement and EU-wide tendering.

Finland got a warning about the need for "timely adoption and implementation" of measures to improve cost-effectiveness of social and healthcare services. Portugal won praise for it shift towards centralised procurement and greater use of generics, but was told to sharpen up on budgetary planning in hospitals.

Romania was criticized for "shortages of health professionals, under-funding and over-reliance on hospitals" – and for persistent corruption, even in "public procurement in hospitals" as well as insurance fraud and bribery for sickness certificates.

The country-specific recommendations "show that healthcare systems need to improve in terms of efficiency," concluded MFE. The problem is that "equity of access to healthcare is challenged by the limited financial capacity of governments to cover growing demand for healthcare services."

And the solution? "Generic and biosimilar medicines provide the greatest opportunity to improve access to safe and effective medicines through efficient medicines policies. Medicines for Europe country recommendations promote sustainable medicines policies to improve patient access to gold standard treatment."

The lobby group segued immediately into its own recipe "to help the EU and member states develop effective policies that support access to medicines for patients.” This urges encouragement of competition from generic and biosimilar medicines, by offering "a predictable market environment for a stable supply of medicines," "clear incentives" to stimulate generic and biosimilar usage "high standards," but "reduced red tape" and waivers to protection of the intellectual property of originator products. And it proffered its own "country recommendations for France, Italy, The Netherlands, Spain, Portugal, Bulgaria and Ireland."

That should help everyone get their house in order. Except that, in relation to France, Italy, The Netherlands and Spain, the EU's recommendations didn't actually mention health at all.

Peter O’Donnell is a freelance journalist who specializes in European health affairs and is based in Brussels, Belgium.