News Release

20th February 2012 

Generic medicines key to unlocking hundreds of millions of dollars in savings for Australian economy: says MJA

A report in the latest issue of the Medical Journal of Australia (MJA), has backed the case for the Government making substantial budget savings by implementing policies that encourage the uptake of high quality but more affordable generic medicines.

The findings in today’s MJA report are backed by the peak body for generic medicines. In the article, Professor Philip Clarke of the Centre for Health Policy, Programs and Economics at the University of Melbourne, says hundreds of millions of dollars could be saved if generic medicines were prescribed more often and the system for pricing them was improved.

Dr Clarke says Australia prescribes proportionally far fewer generic medicines than many other countries. The CEO of the Generic Medicines Industry Association (GMiA), Ms Kate Lynch agrees. “Every time a consumer chooses a follow-on generic medicine, there are substantial benefits to national savings.”

However, she said, across the pharmacy counter, follow-on generics cost the same as the original branded medicine.  Therefore, the patient is not being incentivised to opt for the generic follow-on.  Ms Lynch said this not up to individual community pharmacists but related to the absence of a Government price signal to patients.

“We believe patients should be financially rewarded for opting for a generic medicine which is exactly the same in quality as a branded version yet a much better bet for the economy,” said Ms Lynch.

A follow-on generic medicine is only used in Australia across 36 per cent of all prescriptions as compared to the U.S. at 78 per cent.  This is because in the U.S., patients are far more sensitive to the price of medicines.

Further, the GMiA warns that Australia could face the same shortage of life saving cancer drugs as the U.S, if measures aren’t put in place now to ensure the sustainability of the generic drugs sector here. This was a concern echoed, yesterday, by the Clinical Oncology Society of Australia.

‘Firstly, we need to ensure the Pharmaceutical Benefit Scheme (PBS) remains sustainable and affordable. We need to ensure further cuts to the PBS are avoided. Pharmaceuticals are Australia’s leading export of elaborately transformed goods,” said Ms Lynch. “Yet our role in returning hundreds of millions of dollars to the economy is barely recognised.”

“Secondly, we need to ensure patients have greater access to high quality, affordable follow-on generic medicines. If these policy levers were put in place in this year’s Budget, we know it will be a three way-win for the patient, the taxpayer and the economy.”

For all media enquiries please call Ms Kate Lynch CEO of GMiA on 0432 500 308

BACKGROUND:

The Generic Medicines Industry Association (GMiA) is the national association representing companies that manufacture, supply and export generic medicines. The generic medicines sector is a high value-add sector delivering significant benefits to the Australian public by way of affordable medicines and high skilled jobs. The generic medicines industry in Australia is a high value-add sector, delivering significant health and economic benefits to the Australian public.

The availability of Generic medicines in this country helps to deliver:

·          timely access to affordable medicines;

·          substantial savings to the Pharmaceutical Benefit Scheme;

·          thousands of highly skilled jobs; and

·          domestic manufacturing and exports of over $500 million

Generic medicines deliver exactly the same health benefit to all Australians as the original brand and they must meet the same strict Australian standards, including the same manufacturing requirements, as branded medicines.