Impact of the Minimum Pricing Policy and introduction of brand (generic) substitution into the Pharmaceutical Benefits Scheme in Australia

McManus, Peter; Birkett, Donald; Dudley, John; Stevens, Alan

doi:10.1002/pds.603

Cited by 45 publications

(50 citation statements)

References 3 publications

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“…Globally, generic medicines are effective in treating many of today's ailments and their use contributes to substantial savings in medicines expenditure (Andersson et al 2007;Fischer and Avorn 2004;King and Kanavos 2002). Consequently, a generic substitution policy that aims to encourage the utilization of generic medicines has been legislated in various developed (Heikkila et al 2007;McManus et al 2001;Simoens and De Coster 2006;Simoens 2009) and developing countries (Gossell-Williams 2007;Homedes and Ugalde 2005;NAPM 2009). This policy allows pharmacists to substitute brand name medicines with bioequivalent generics, provided if allowed by the prescribing physicians and consented to by the patients.…”

Section: Introductionmentioning

confidence: 99%

Generic medicine substitution practices among community pharmacists: a nationwide study from Malaysia

2010

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Aims This study aims to assess generic medicine substitution practices among Malaysian community pharmacists. Method A cross-sectional nationwide descriptive study using a specific mailing data collection form was conducted from May 2007 through December 2007. A sample of 1,419 community pharmacies was involved in this study. Data were collected across the brand name medicine requests encountered on 14 working days and for which an equivalent generic product was available. Pharmacists' generic substitution rate, physicians' and patients' acceptance of substitution and cost saving achieved from substitution were assessed. Results Responses were received from 157 pharmacies (response rate 11.1%). The pharmacists recommended generic substitution for 84.7% (1,538/1,815) of the brand name medicine requests. While suggesting substitution, the pharmacists voluntarily consulted the physicians for 13.1% (91/695) of the recommendations which involved prescription orders. The majority of the physicians (87.9%) when consulted by the pharmacists accepted the recommendation for substitution. Meanwhile, 88.9% (1,368/1,538) of the pharmacists' substitution suggestions were accepted by the patients. The overall patients' expenditure on medicines was reduced by a total of 57.4% (Malaysian ringgit 27,266.30 or US $7,369.30; US $1.00 = Malaysian ringgit 3.70) through acceptance of substitution. Conclusion The Malaysian community pharmacists actively recommended generic substitution for brand name medicine requests which they encountered. Both the physicians and patients highly accepted the substitution recommendation and this contributed to significant reduction in patients' medicines expenditure.

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Section: Introductionmentioning

confidence: 99%

Generic medicine substitution practices among community pharmacists: a nationwide study from Malaysia

2010

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“…Given that one of the stated policy aims of government is to increase generic competition as a way of decreasing pharmaceutical prices, 14 it is important not to assume that this effect is realised without question. The average effect of a 0.4-1% price reduction per generic seller as suggested by these results on the overall PBS budget may provide significant budget savings, although the estimation of the magnitude of this effect is beyond the scope of this paper.…”

Section: Discussionmentioning

confidence: 99%

“…[10][11][12][13] As such, it is timely to assess the relative success or otherwise of pricing policies over time. The 'Minimum Pricing Policy' 14 , introduced in December 1990, had little impact in increasing price competition between generic manufacturers until the subsequent generic or 'Brand Substitution Policy' was introduced in 1994. 14 The latter allowed pharmacists to substitute between interchangeable brands of the same medication (with consumer and prescriber consent).…”

Section: Introductionmentioning

confidence: 99%

“…The 'Minimum Pricing Policy' 14 , introduced in December 1990, had little impact in increasing price competition between generic manufacturers until the subsequent generic or 'Brand Substitution Policy' was introduced in 1994. 14 The latter allowed pharmacists to substitute between interchangeable brands of the same medication (with consumer and prescriber consent). A brand premium exists when a manufacturer chooses a price above the benchmark price paid by the government, with the resulting difference in price passed on to the consumer.…”

Section: Introductionmentioning

confidence: 99%

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Does generic entry lower the prices paid for pharmaceuticals in Australia? A comparison before and after the introduction of the mandatory price-reduction policy

Spinks¹,

Chen²,

Donovan³

2013

Aust. Health Review

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Objective. We investigated the relationship between the number of generic medicines and pharmaceutical prices over time in Australia.Methods. A dataset was utilised containing 76 items for 4 years (2003)(2004)(2005)(2006)(2007) on the national subsidy scheme -the Pharmaceutical Benefits Scheme (PBS) -for which a generic brand is available. The PBS price was used as the dependent variable, and the number of generics available the key explanatory variable. The ordinary least-squares estimator was adopted for estimation. In the robustness analysis, an instrumental-variables method was used to account for potential endogeneity.Results. Results suggested that the effect of increased generic medicine sellers on reducing the prices paid for generics is marginal but statistically significant.Conclusions. It is suggested that structural changes to the way generic prices are determined needs to be reconsidered by the Australian government if the policy aim of using increased 'competition' to lower prices is to be maximised.What is known about the topic? There is scant empirical evidence that supports the notion that increased generic availability for pharmaceuticals, in heavily price-regulated markets such as Australia, has a significant effect on lowering the prices paid over time. Despite this, Australia has adopted a policy that promotes increased generic 'competition' as a means of controlling prices, without establishing if this policy has, or is likely to be, successful in the longer term. What does this paper add? Using longitudinal data from Medicare Australia, this paper quantifies the relationship between the number of branded and generic items of a given drug molecule and formulation, and prices paid over time, controlling for other explanatory variables. What are the implications for practitioners? The results suggest that although increased generic entry may lower prices over time in the Australian context, the price reduction gained is likely to be very small. Therefore, whilst generic entry should be encouraged, it is important not to assume that this price-lowering effect is realised without question and that the magnitude of such an effect is comparable with other price-regulated countries.

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“…Die Substitution von Spezialitäten durch generische Medikamente wird in manchen Ländern bei der Medikamentenabgabe beeinflusst [3,4]. Dieser Mechanismus beschränkt ÄrztInnen bei der Verordnung spezifischer Produkte.…”

Section: Introductionunclassified

Kostenreduktion durch projektgestützte Verschreibung von ACE-Hemmer Generika

Wolzt

Ohrenberger

Reichardt³

2003

Wien Klin Wochenschr

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Impact of the Minimum Pricing Policy and introduction of brand (generic) substitution into the Pharmaceutical Benefits Scheme in Australia

Cited by 45 publications

References 3 publications

Generic medicine substitution practices among community pharmacists: a nationwide study from Malaysia

Generic medicine substitution practices among community pharmacists: a nationwide study from Malaysia

Does generic entry lower the prices paid for pharmaceuticals in Australia? A comparison before and after the introduction of the mandatory price-reduction policy

Kostenreduktion durch projektgestützte Verschreibung von ACE-Hemmer Generika

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