High price pressure weakens supply
Vienna (OTS) – There are currently reports of a supply bottleneck in antibiotic juices for children. While the Chamber of Pharmacists proposes in-house production of the drugs using raw materials from abroad, a long-term solution to the increasing bottlenecks in medicines has to be found. All antibiotic children’s juices are patent-free, so the proportion of generics is correspondingly high: it is around 57 percent. A total of 30 different generics for antibiotic juices for children are on the market. According to IQVIA, 93.4 percent more antibiotic juices were distributed in 2022 than in 2021 and 11.4 percent more compared to 2019, i.e. before the pandemic. The demand has recently increased by a multiple. At the same time, the prices for such drugs are falling steadily: the average price of a pack is EUR 5.25 and has therefore fallen by almost 5 percent since 2019.
Only a few manufacturers left
For example, there are only five manufacturers worldwide for penicillin active ingredients, which belong to the subgroup of antibiotics. The largest is in China, the second largest manufacturer in Tyrol, Austria.
The supply usually works very well, but was no longer able to cover the recently extremely high demand in the short term. Unfortunately, the problem of such bottlenecks is self-made: both the price pressure and the requirements for manufacturers are constantly increasing. The manufacturers therefore have to produce under maximum utilization of their capacities in order to remain profitable in terms of costs and also to finance the continuous investments in the necessary modernization of production facilities. Medicines that fall below the profitability limit can therefore no longer be made available for supply in the long term.
Investments in increasing production capacity and efficiency can hardly be financed anymore and the production of active ingredients is increasingly being shifted to countries such as China or India for cost reasons. There, there is a subsequent consolidation of the companies, because the volume also influences the production costs there. As a result, there are only a few manufacturers left for many active ingredients.
New solutions are needed
“The current economic conditions and limited ability to plan damage the security of supply and weaken Austria as a business location,” says Wolfgang Andiel, President of the Austrian Generics Association.
The Generics Association therefore demands, among other things, the introduction of the possibility of adjusting drug prices at least to the consumer price index in order to at least partially compensate for the enormously rising costs.
In addition, the OeGV calls for concentration on measures that increase the proportion of prescriptions for generics. Every additional percent of generic prescriptions saves the statutory health insurance 15 million EUR. More generics mean more treatment alternatives and therefore better care.
Instead, prices will be further reduced from October 1, 2023 and medicines that are not subordinate to this will be removed from reimbursement. In addition, there is a threat of further compulsory price reductions from 2024. So-called deletion procedures can be used to force price reductions to the lowest generic drug in each case, otherwise the social security system will also remove medicines from the reimbursement code. These deletion procedures from the reimbursement code must be abolished. Otherwise, the massive pressure on supply will continue to increase.
“It is still possible to adjust the framework conditions for the next winter season so that not only planning and production, but also market conditions promote supply. Generics make an important contribution to supply and social insurance can save a lot of money. However, if the price pressure remains so high, the range of generics and thus also the high savings potential will decrease. This also endangers the security of care for the patients,” warns Andiel.
About the Generic Association
We are the Austrian Generics Association, an association of 11 generics producers who are committed to the optimal supply of Austrian patients with high-quality, inexpensive medicines. The aim of our association is, on the one hand, to inform the public regarding the advantages of generics and, on the other hand, to help shape current health policy debates.
Questions & contact:
For the Generics Association
Ute Stocker
ute.stocker@gaisberg.eu
+4366488446426
