Abstract
The increase in the consumption of generic drugs to reduce pharmaceutical expenditure is a challenge for many countries, especially during the economic crisis. The purpose of the present study is to review the Greek market of generic drugs and the decisions that shape it, to determine the factors that affect Greek patients’ and doctors’ attitudes about generic substitution and present a set of measures for all stakeholders based on the findings of the secondary and primary analysis. The study includes (a) an analysis of international and national reports and legislation on drugs policies and (b) a questionnaire survey of 242 hospital patients and 85 doctors regarding their perceptions on generics. A small increase in the volume of generics is recorded, yet not followed by sales value, over the recent years that the measures for promoting generics prescription took effect. Distrust from both patients and doctors was observed toward generics’ effectiveness and toward the appropriateness of the regulatory authorities’ quality controls. The study presents a structured set of viable measures, applicable to many countries, for promoting generic drug consumption that can lead to economic efficiency without degrading the health care quality.
Keywords
Introduction
With the demographic aging of the European population and the budgets of the European Union (EU) Member States under constant pressure, generic and biosimilar drugs have been one of the key points for maintaining a sustainable health care system. In 2014, in Europe, generics accounted for just above half the volume of the pharmaceutical spending and saved annually about €100 billion. 1
During the years 2000–2009, the pharmaceutical expenditure in Greece represented the highest percentage of gross domestic product (GDP) compared to other Organization for Economic Co-operation and Development (OECD) countries (oecd.org) in particular due to the shift toward the expensive innovative drugs. 2 Since the economic crisis took off in 2008, Greece adopted a set of measures to gradually increase generics consumption against off-patent drugs in order to suppress the high pharmaceutical expenditure.3,4
Nevertheless, substituting original drugs with generics has been met with great suspicion toward therapeutic outcomes, though it has succeeded great savings in many developed countries. And although over the last decade opinions of generic medicines have improved, 5 many patients still remain with the impression that generics are cheaper than the original ones because of their lower quality and effectiveness.6–8 Doctors, on the other hand, are not convinced of the potential economic gain from their use and the ability of the national regulatory authorities to address the pharmacovigilance mandates that generic substitution requires.9–14
Overall, this study attempts to describe the generics market in Greece and to collectively show drug policy reforms over the economic crisis, the measured outcomes, the patients’ and doctors’ views on generics, and a list of recommendations for all decision makers on the issue. Therefore, its contribution to the specific literature is it that provides a full account of the changes, the perceptions and evidence-based recommendations for all interested parties. The survey on perceptions of generics comes to enhance the literature by presenting for the first time a comparative study of both patients and doctors opinions on the same set of questions and at the same timing. We hope that this holistic approach is useful not only at the national level but also to other countries which reinforce generic drugs strategies.
Materials and method
The research is twofold. The first part involves the collection of a number of data from different sources to present the recent transforming policies with relation to drugs, and generics in particular, and to show the impact of these policies on (a) the consumers/patients, (b) those in the business of drug production and sales, and (c) on the national pharmaceutical expenditure. Data were collected from legislation, the IMS Health, health reports, and data from the World Health Organization (WHO) and OECD, the European and Hellenic Association of pharmaceutical companies (sfee), and other international agencies and national official agencies related to drugs (International Federation of Pharmaceutical Manufacturers & Associations [IFPMA], National Organization for Medicines [EOF], sfee, etc.). Furthermore, interviews were carried out with staff of IMS Health with the intention to acquire missing data on generics volume and sales throughout the recent years.
The second part of the research investigates the factors that affect patients’ and doctors’ perceptions about generic substitution in Greece. The survey was conducted from February to April 2015 and after a pilot run, questionnaires through face-to-face interviews were completed from a convenience sample of 242 patients and 85 doctors of a big hospital. The hospital setting was chosen as it was convenient to collect questionnaires from both groups (patients and doctors) at the same time, moreover collection took place in both hospital inpatient and outpatient clinics, therefore the sample incorporated both acute care and chronic care patients. All participants provided informed consent. Eligibility criteria for study participation were that the respondent was an adult, speak Greek or English, and was in a stable mentally and physically condition to answer the questions. Hospital patients were chosen because they are more likely to be informed, through their health problem experience, about drugs and generics in particular. The questionnaires were comprised of a set of common questions regarding their general perceptions for generic drugs to both groups of respondents and a set of different questions relevant only to patients or doctors. The questionnaires consisted of closed-ended, 5-point Likert-type scale questions (from 1 = strongly disagree to 5 = strongly agree). Descriptive and inferential statistical analysis at the 5% significance level were carried out. The internal reliability of the questionnaires for patients and doctors according to Cronbach’s alpha index was 0.737 and 0.741, respectively and therefore within the acceptable limits.
Results
Drug pricing and generics penetration
In Greece, after patent expiration, the prices of drugs (off-patent) are reduced by 50% and the prices of generics regardless of their approval date retain 65% of the price of the respective off-patent (used to retain only 40% before 2016) or 32.5% of the on-patent drug price (Law4337/2015). Furthermore, every time that a new pricing list is published for the off-patent products, additional horizontal price cuts are applied of 2.5–10% (FEK64Β/2014). Generic drugs with retail price greater to €12 follow a dynamic pricing; for every €250,000 increase in sales, prices in each subsequent year have additional reductions of 1–15% (FEK2577/Β 2015). Before 2017, the off-patent and generic drugs with retail prices lower to €12 and €7.8 respectively were protected by pricing interventions that would lead to further price reductions. That government’s goal was to ensure the economic sustainability of the domestic pharmaceutical industry and the maintenance of cheap drugs in the market. Else, the continuing pricing cuts could lead the domestic manufacturers to the withdrawal of these nonprofitable very cheap generics and their substitution by other more expensive products of the same therapeutic category. From mid-2017, the protection limit is set at €1 for off-patent and generic drugs, tailored more closely to market rules (FEK2577Β/2015). Yearly drug price reductions in 2016 were on average at 3% (15–17% reduction for the old inexpensive drugs while only 1% for the new expensive drugs of €30–€150 (pef.gr)). Eight consecutive drug price reductions were applied from 2012 to 2016. The decline in medicine prices from, 2009 until, 2014 was estimated at 26.5%. 15
For the period 2000–2006, Greece was the country with the longest penetration time of generic drugs after patent expiration among the 15 Eurozone countries. 6 Since 2006, a policy is in effect (FEK59Β/2006) for accelerating marketing authorization within seven months from the submission of a complete application to the EOF. However, based on, 2010 data, it appears that 24 months after patent expiration, the market penetration of generic drugs was only 9.1%. 16
According to the Hellenic Association of Pharmaceutical Companies (SFEE), 15 the penetration of on-patent drugs in volume in Greece for, 2013 and, 2014 was at a higher rate than in other European markets as shown in Table 1 and price is a key contributing factor to the elevated drug cost due to the expensive new drugs entering the market. 17 On the other hand, generics’ penetration in volume for, 2014 was at 28.7% (achieving only a small increase from, 2013 figure), as shown in Table 1; relatively low compared to other Eurozone countries that achieved percentages of 50% and above for the same year, such as Germany (73.1%), the United Kingdom (66.1%), and France (52.8%).
Penetration of pharmaceutical products in volume in Greece and the EU average for 2013 and 2014 and drug pricing for 2014.
Source: IMS Health.
In Greece, the penetration, in terms of total sales, was also very high for the original products of the multinational companies, amounted to over 80% in contrast to 20% of generics consumption in sales (for the first months of 2015) [eof.gr]. This is due to the low prices of original drugs in Greece compared with other EU countries. The pricing is associated with the levels of per capita GDP and total health expenditure and is influenced by demographics and by the priorities of domestic policy. 18 Therefore, the prices of on-patent drugs seem to be proportionally higher in member states with higher per capita income levels. In Greece, the prices of on-patent drugs are set to the average of the three lowest corresponding prices of EU member states (using the external reference pricing system) and therefore contribute to cost containment (FEK2577Β/2015). On the contrary, in Greece the prices of generic drugs, which are determined based on the maximum prices and linked to the prices of original products, are among the highest in Europe and are relatively close to the prices of off-patent original products, as shown in Table 1. It has been observed that in member states, which do not follow this pricing policy, generic drugs usage has rapidly spread and over time, their prices decreased to a greater extent. 18
Drug policy reforms toward the increase of generics
Following the strict framework of fiscal policy, public health expenditure declined by about 6.8% of GDP in 2009 to 5% in 2015, the public pharmaceutical expenditure approached to 1% of GDP in 2014 (€2 billion), recording a sharp decline of 60% from 2009 to 2014, and the public per capita pharmaceutical expenditure to €183 for 2014 and therefore 30% lower than the estimated average of the Eurozone, while in 2009 was much higher than the average (Foundation for Economic & Industrial Research, 2013–2015). Yet even by 2014, the total pharmaceutical expenditure as a percentage of GDP remains among the highest in the Eurozone and the OECD countries (oecd.org).
The objective to reduce public pharmaceutical expenditure lead to direct measures for cost containment through prices regulation and payback mechanisms. These are mainly described by (a) yearly interventions on prices and especially in the reduction of the generics and off-patent prices, as discussed above, (b) the compulsory rebates established since 2012 which is the mechanism of financial returns, based on turnover, as a discount provided from pharmacies to their biggest client, i.e. the public health insurance institution (EOPYY), and (c) clawbacks, since 2012, which is the mechanism of automatic cash refunds from the domestic pharmaceutical companies to EOPYY to cover the discrepancy between the actual costs for drugs and the pharmaceutical budget of social insurance funds. In 2016, clawbacks were also enforced in hospitals when they surpassed a certain pharmaceutical expense limit. In Greece, pharmaceutical companies deal with either the production or the import of generic drugs.
Article I. From the patients’ side (EOPYY insured), the co-payment to the pharmaceutical expenditure with out-of pocket money, when purchasing a medicine that is reimbursed by the social insurance scheme, has radically increased, as the weighted average rate of their participation has risen from 15.7% in 2012 to 26.5% in 2014 (eof.gr). The households’ co-payments contribution for most categories of drugs is 25% of their listed price but several patients’ groups are exempted from this obligation according to the type and duration of disease. Another measure boosting the preference of generic drugs against off-patent is that patients are called to pay a fine (on top of the co-payment) if they choose to purchase an off-patent, which is more expensive, while a bioequivalent generic is traded. 19 The patient pays the full difference between the reimbursement price of the generic (set by the reference price system) and the retail price of the off-patent(FEK1276/2014).
Another measure has targeted to the reduction of pharmacists’ profit margins. The target of the reform is to gradually bring down the average profit margin on medicines sold by pharmacies. In 2009, pharmacies were operating with a 30% profit margin, while in 2014 with a 21% and in 2016 with a 15.7% (FEK1805B/2014).
Article II. Other measures that Greece has adopted to boost generics use are the electronic prescribing which is tracked by the Ministry of Health and social insurance funds. Since its implementation in 2011, the system is continuously updated with new regulations for doctors aiming at a stricter monitoring of drug type and volume issuing. The most important of these measures are the following: Doctors are obliged to prescribe only the active drug substance and not its brand name (branded prescription is allowed only up to 15%). They have the obligation to indicate the diagnosis with the International Statistical Classification of Diseases and Related Health Problems (ICD-10) system and match it with the therapeutic protocol of drugs listed in the prescription. The volume of drugs administered is determined by the corresponding dosage, which must comply with the indications of the drug. Doctors can prescribe only drugs and examinations of their speciality (FEK1233/2102). The system continuously monitors doctors about drug volume issuance levels giving an alert when the defined limits are surpassed. It also informs about the generics share of total drug issuance. This monitoring became a lot stricter from 2015 with the introduction of new minimum percentages of generic prescribing targets by volume that range from 9% to 92.5% depending on the therapeutic area and also lowered the monthly drug issuing ceiling which is defined according to the speciality, the region, and the season. New penalties are also issued, for example when a doctor goes beyond an aggregated 20% for three consecutive months (or 6.7% per month) a written recommendation for compliance is issued and explanations are requested. If these are not conclusive, the health insurance organization may impose fines from 1000 to 5000 euros depending on the level of surpass. Other penalties may be the temporary exclusion from prescribing or termination of the contract with the health insurance for those who constantly violate guidelines, create induced demand, and adopt a biased prescription pattern (FEK1117B/2015). No matter the strict measures, it seems that rational prescribing has not been achieved as Greece is still among the European countries with the highest levels of antibiotics consumption (European Centre for Disease Prevention and Control, 2015).20
Table 2 presents the penetration of generics, including only retail sales from pharmacies, from 2008 to 2015 in value and volume as a percentage of the total drug market (prototypes, off-patents, and generics). It is apparent that in Greece the above measures, which in their majority target the increase of generics in the retail settings, have not yet had a measurable effect. Only a slow increase in generics retail sales volume is observed that is followed by a slightly smaller increase in sales value due to the price reductions. Unfortunately, data for the use of generics from the National Health System (NHS) in Greece (public hospitals and public health settings) are only available in value terms for 2011–2013, at the beginning of the reforms. The numbers are low, although higher than retail, with a small upward trend.
Penetration of generics in Greece in retail from 2008 to 2015 and in ESY from 2011 to 2013.
Source: Ministry of Health, Greece.
The new Greek fiscal adjustment program has set the target at 50% in the volume of generics inpatient consumption by the end of 2016 and at 60% by mid-2017 and the share of generics in the outpatient sector should be increased to 40% by mid-2017 and 50% by mid-2018. 21 This is a great challenge for Greece as the presented figures, although not exactly comparable to the inpatient–outpatient format (which are introduced for the first time), are quite far from the set targets.
Patients’ and doctors’ perceptions of generics—Survey results
Two hundered and forty-two patients participated in the survey on generics perceptions, 60% of which were female. 28.1% fell under the age group of 18–40, the vast majority (56.2%) in the 40–64 group, and the rest were over 65 years old. Nineteen percent were illiterate or primary education graduates, 50.4% graduates of secondary, and 30.6% of higher education. Nearly 50% reported an annual personal income of up to €8000 and only 12.4% over €18,000. Regarding the 85 doctors who participated in the study, 55% were female. A total of 49.4% of the participants were under 35 years old doing their specialty training, 23.5% fell under the age group of 36–50, while the others were older than 51 years old. The majority had 0–5 years of professional experience and reported annual personal income of up to €18,000. In Table 3, we report the responses of the common questions between the two surveys and some very interesting findings from each questionnaire. The table presents the mean (and the standard deviation SD) response rates in the Likert-type scale from 1 to 5 in order to compare the views of groups. A p value < .05 reveals that statistical significance difference exists between the answers of doctors and patients.
Questions for patients and doctors, mean and standard deviation (SD) of their responses (1 = strongly disagree to 5 = strongly agree).
*Statistically significant difference (p < 0.05).
A first observation from Table 3 is the convergence between patients’ and doctors’ views regarding generic drugs. A total of 84.3% of patients (4.22/5) and 83.6% (4.2/5) of doctors who participated (these percentages represent the sum of agree and strongly agree responses on the Likert-type scale) consider generics as cheaper than original drugs. However, only half of the surveyed patients and doctors show confidence in the national certification body of drugs. It seems that patients trust more the drugs of well-known companies that sell for years in the Greek market.
More than half of the patients (56.2%) agreed with the view that some doctors react to generics prescription because they are afraid of losing their acquired privileges that enjoy due to them being “good clients” of certain pharmaceutical companies. Moreover, according to the overwhelming majority (76%) of patients, the doctor plays the most important role in the patient’s decision to use generics as he or she can choose the right drug in each case. Cross-tabulation analysis revealed that male, older, low income, and educated patients seem to be more fond of generics substitution.
The percentage of doctors who believe that generics are safe and effective in this survey is 70%, an increased figure compared to past studies who only reported 50%.10–12 Also, only half of the doctors show confidence in the ability of the EOF to ensure that generic products are subject to strict quality controls as the original ones. Suspicions about EOF are confirmed also by the fact that not all doctors agree (only 68% agree) that generic drugs are bioequivalent to original ones, apparently disputing the proper conduct of bioavailability studies. However, the majority of doctors believe that the widespread use of generics may reduce health expenditures and save money to the patients due to their low cost. In similar surveys that were conducted in Greece, the majority of doctors (>60%) took into account the cost when prescribing drugs to patients.9–11 The reputation of the pharmaceutical company seems to play an essential role in the perceived quality of the product, as a high proportion of the respondents maintain its reservations about generics that come from developing countries. Cross-tabulation analysis revealed that male, older and high-income doctors seem to be more fond of generics substitution.
In summary, the determination of patients–consumers’ and health professionals’ attitudes is another step to assess the overall impact of generic drugs in the pharmaceutical market. The knowledge that is gained can be used to take measures for circumventing obstacles and increasing generic consumption.
Recommendations to the pharmaceutical market’s stakeholders
Recommendations to the health policy makers
A simple and applicable framework of drug policy can generate savings while meeting the needs of the health system. Emphasis should be given to the investigation and elimination of the causes that delay the commercial availability of generic products in the Greek market following the patent expiration of the original drugs. 22 According to the generic pharmaceutical companies, delays in decisions on pricing and inclusion in the positive drug list (which contains the medicinal products that are reimbursed by the social insurance funds) arise as a result of additional requirements demanded by the respective institutional bodies of the regulatory framework, extending therefore the integration process. 23
The competition in the pharmaceutical market appears to enhance the penetration of generic drugs, which is more successful in countries that have implemented free pricing system for drugs than in countries with stricter regulatory framework. 24 The abolition of maximum drug prices and the adoption of a pricing system that allows the viability of generic products in the pharmaceutical market have been recently followed by the Greek government. A scaling reduction has been adopted which will eventually lead to the removal of the protection threshold for off-patent and generic drugs, following an equal pricing treatment for all drug products. However, in Greece any further price reductions should be part of an integrated drug policy approach in order to avoid the negative effect on the domestic pharmaceutical industry by the substitution of its generic products with more expensive drugs from multinational companies. The combination of low pricing of generics as a percentage of the original drugs and the increase of their market share may work well for all parties. 25
A basic prerequisite for the survival and sustainable development of the national generics pharmaceutical industry, which has yielded significant economic benefits to the country the recent years, is the stability of the business environment. However, the institutional enforcement of clawbacks as a stabilizing measure of government spending, seriously affects domestic pharmaceutical companies. The reduction of clawback or its abolition can prevent the loss of jobs and the relocation of Greek manufacturing plants in neighboring countries with a more favorable fiscal environment. Realization of the potential of the Greek pharmaceutical companies can boost domestic production and further stimulate investment initiatives. The empowerment of market openness of Greek pharmaceutical companies, which have already undertaken significant export activities, can be achieved by facilitating the relevant procedures, strengthening healthy competitive forces in the pharmaceutical sector and increasing the possibility of unhindered circulation of new generic products. 26
Moreover, the establishment of centralized procurement for hospitals in 2016–2017 is hoped to achieve better prices or discounts by the pharmaceutical companies. 27
Recommendations to the health professionals
As the main reason for replacement of the therapeutic scheme of a patient is the recommendation of the attending doctor an incentive strategy is required for generic drugs prescription. A finding that is also supported in literature 5 and particularly in surveys conducted in Portugal 27 and Italy. 13 The educational curriculum in medical and pharmaceutical faculties of the country must be readjusted on issues related to generic drugs and to pharmaco-economics for the evaluation of health programs.14,28 In addition, the introduction of a compulsory point collection system, after the acquisition of the main degree, through the attendance of related seminars, is a method for assuring contemporary knowledge of health issues and policies as well as of issues of new original and generic drugs circulation. 6 The pharmaceutical expenditure is directly related to the prescribing behavior of doctors which may be biased due to their established benefits with international pharmaceutical companies. Evidence from the literature suggests that physicians consider the profit they can derive by prescribing certain drugs. 29 Taking these points into consideration, the provision of financial incentives to doctors can strengthen the development of generics market. Such incentives may be e.g. rewarding those who prescribe low-cost drugs and imposing penalties to those who systematically prescribe expensive medicines despite the alternatives that exist (e.g., in France, bonuses are awarded to doctors who have high prescription rates of generics).2,3 Regarding pharmacists, the provision of financial incentives, such as the increase of their profit margin for generics sales and the partial or total exemption from rebate payments for those drugs, may further enhance the promotion of generics.
Recommendations to patients–consumers
Drug substitution with generics is met with suspicion by the patients whose views on the safety and effectiveness of generics appear to be broadly divided. Actions in order to overcome these doubts are interventions by the Ministry of Health such as, the launch of informational campaigns for the generics safety and bioequivalence, the distribution of material especially designed for the general public, the posting of announcements in public places, and display of advertisements with an educational content in the media. 30 In Japan, the respective Ministry has issued a handbook with the authorized medicinal products and their therapeutic equivalence evaluations in order to inform both consumers and health professionals for the generics. 31 Furthermore, a reduction of the households’ co-payment when choosing generics may work as an incentive for increasing their consumption. Finally, as the patients–consumers’ awareness of generics is linked to some extent to the one of the physicians, the measures proposed to the health professionals may positively affect the patients too.
Recommendations for the EOF
Ensuring the safety and effectiveness of generics requires the thorough examination of drug imports and the monthly reevaluation of quality controls regulatory procedures. 10 The reservations of doctors against EOF may lie on the fact that the Agency cannot be trusted for carrying out all necessary controls. One reason is that the Agency is seriously understaffed with a constant diminishing of its personnel from 260 to 150 employees, while other European Medicines Agencies in countries with smaller populations, such as Ireland, Denmark, and Sweden have 300, 500, and 750 employees, respectively (eofse.gr). The enhancement of EOF’s role with an appropriate level of staff, consisting of specialized scientific and administrative employees who can closely collaborate with the country’s universities, research centers and hospitals, will provide a comprehensive framework to ensure the quality of generics based on strict criteria and high standards.
Recommendations to the generic pharmaceutical industries
The confidence of doctors and patients to generic drugs and the intention of the first to prescribe them and of the second to consume them is based on the reliability of the pharmaceutical company that produces them. It is also worth noting that all pharmaceutical companies have ISO-quality management system certifications and follow rules of good manufacturing practice (GMP) (iobe.gr). The following will help pharmaceutical companies to improve the quality of their products: (a) a comprehensive pharmacovigilance system through proper recording of possible adverse reactions to the yellow card and (b) the implementation of the Electronic Medical Record to all health centers, which will carry all medicinal products administered to patients together with their effectiveness, therapeutic failures, and side effects. Furthermore, pharmaceutical companies, which give priority to the clinical efficacy and safety of their products, can participate, through proper incentives, in the development of centers for monitoring patients after generic substitution and for training health professionals in order to establish a broader communication between drug producers, prescribers, and users. Like this doctors’ trust in generics will be enhanced and consequently they will start prescribing generics with more confidence. 32
Conclusion
At a time of limited financial resources for Greece, the successful implementation of the above measures with the aim of increasing generic use when is clinically appropriate, can reduce costs without degrading the healthcare provision. Generic drugs prescription seems to be able to achieve clinical effectiveness and cost-efficiency simultaneously. This policy is supported both by the patients and doctors of the present study as they understand that the widespread consumption of cheap but qualitatively controlled generics can ensure the sustainability of the NHS which is at stake in recent years.
This study has strengths and limitations. Strengths include the holistic approach of the issue on boosting generic drug consumption in Greece with the aim of reducing pharmaceutical expenditure. This contains the enforced policies, their impact on each involved stakeholder (national pharmaceutical companies, pharmacies, doctors, households, hospitals, health insurance), the effect of these policies so far, the perceptions of patients and health professionals about generic drugs and recommendations of how this target can be reached more effectively. The primary limitation of this study relates to the unavailability of consistent data over the years that measures took effect. The available figures cannot reveal a holistic and accurate measurable effect of these policies’ outcomes. An agreed measurement method of volume and sales shares between branded drugs and generics must be developed. 33
Footnotes
Declaration of conflicting interests
The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.
Funding
The author(s) received no financial support for the research, authorship, and/or publication of this article.
References
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