Incentives Incense Industry in UK

The Association of the British Pharmaceutical Industry is challenging the UK government over the financial incentives being offered by the Department of Health (DH) to encourage doctors to switch patients from on-patent medicines to specific generic alternatives. ABPI believes the way the incentives are structured contravenes EU law—if pharma companies were to offer similar payments, they would be in serious trouble.

Sarah Houlton

The main concern is over cholesterol-lowering statin medicines, although other medicines are involved. Doctors are being given financial incentives to prescribe named off-patent statins—simvastatin or pravastatin—instead of Pfizer's Lipitor (atorvastatin) or AstraZeneca's Crestor (rosuvastatin). The sole reason for doing this is price, with no regard paid to the wishes of the patient, even if they have been taking one of the on-patent alternatives for some time. DH estimates that, for statins alone, changing to generic prescribing would save it £84 million a year.

There is precedent elsewhere in Europe for doctors to be incentivized to increase their generic prescribing. In France, for example, the largest public health insurer requires doctors to prescribe generic statins where possible, with the aim of 80 percent of all statins it pays for being off-patent. And in Germany, statins were included in the reference-pricing system—so they are all reimbursed at the cost of the lowest, effectively destroying the market for those more expensive products that are still on patent. But none of these include direct financial incentives to doctors to prescribe named medicines.

ABPI was involved in drawing up the cost-effective-prescribing guidelines that were recently issued by DH, and Richard Barker, ABPI's director general, is keen to stress that the industry supports them. But the industry's concerns about the incentives for prescribing generics remain.

"We believe that the law says that you cannot provide a specific financial incentive for the prescription of a specific medicine, and some of the programs that have been set up by primary care trusts [the organizations that make funding and care decisions at a local level] do just that," Barker says. "As an industry, we don't have any problem with a situation where PCTs use some financial incentives that provide money for overall cost-effective prescribing. And there may be room within that for an element of prescribing generic medicines versus branded products, as long as it's appropriately controlled. But to give a specific payment for a specific switch from a named medicine to another named medicine is a step too far and actually does breach the law. If pharma companies were to do that, there would be a justifiable outcry—we would, so to speak, have bribed a doctor to prescribe one of our medicines. We think that it should cut both ways."

Barker stresses that ABPI is "completely supportive" of government efforts for cost-effective prescribing, as the industry wants the overall expenditure on medicines in the United Kingdom to have the maximum possible impact. "But there are two further things that concern us about the programs that we have seen appearing across the UK," he says. "First, in our view and in the view of a number of doctors we've spoken to, there are insufficient safeguards for patient safety. And secondly, we don't believe that it adequately ensures that patients are consulted before the changes to their medication are made."

He believes that, even if the switch to a generic were appropriate, it's not something that a patient should feel is "done to them" without their agreement. "A switch from one medicine to another could easily confuse an elderly patient or make them say that they don't like the new one so they won't take it," he claims. "So an automatic switch of a prescription from something to which they have become accustomed to something that's new needs to be accompanied by a conversation with a doctor, and we don't think the guidelines go far enough in that regard."

An ABPI spokesman says the court is unlikely to set a date for the review before the end of the year. The DH says it will "rigorously defend" ABPI's challenge.

Sarah Houlton is Pharmaceutical Executive's global correspondent. She can be reached at sarah@owlmedia.co.uk