DRUG SHORTAGES - THE KEY ISSUES
The difference between the UK and the EU attitude towards Pharmacies and the drug industry is a crucial part of issue taking place within the Pharmaceutical Industry. The diverse opinions makes it very hard for those who try to adhere to all the laws and best practices, European and UK alike. Some examples are the views on how the supply chain should be formed between Manufacturer, Wholesalers and Pharmacies.
UK wholesalers brought EU medicines from EU exporters at a cheaper price than the drug was available in the UK at the time. Sometimes the price differed by as much as 40%, cheaper than the same product sold to UK pharmacies who in turn sold to the government at an agreed price. Prior to 2006, the UK imported over £1.2 billion of medication from EU member states. This saved the NHS approximately £250 million. This did not cause a medicines shortage at the time within EU states!
UK pharmacies get their drugs remunerated according to a fixed tariff. Hence the only way for a pharmacy to increase its profitability is to buy medicines cheaper. Pharmacies and wholesalers increased competition between generic manufacturers and forced drug companies to reduce UK prices to match those available in Europe, saving the NHS millions which in turn was invested back into patient care.
Vital drugs are priced far in excess of the true cost, as such monoclonal cancer drugs are NOT available to the British public. The move to restrict drugs and free movement of drugs into Europe is simply a cynical extension of a policy designed to protect shareholder value, irrespective of the law.
Since 2002, most new drugs brought to market have done so by obtaining a Pan-European single centralised marketing authorisation (MA)
(It is interesting that despite having a single marketing authorisation, pharmaceutical companies chose not to create a pan-European multilingual pack to coincide with the single EU application. )
It has been established that a drug company must make enough medicines for every EU patient that may require it. The drug companies have attributed the drug shortage to pharmacists exporting stock into the EU (legally in accordance with the ‘Free Movement of Goods and Services in Europe’). However if this were true, then there would be a regular occurrence of surplus stock in these countries that the pharmacies were exporting to, which means the overspill would be pushed back into the UK and converted into UK packs within a fortnight.
The number of users of, for example, ‘Lipitor’ in Europe as a single market is static and the drug companies have legally undertaken the promise to ensure that they provide efficient stock. If this were the case, how could there possibly be a shortage if they were making the sufficient amounts?
Classification of medication
The pharmaceutical industry has been unlawfully reclassifying almost 20% of all prescirption drugs. The drugs have been reclassified as ‘hospital only’ or ‘homecare only’ in direct contravention of the Medicines Act 1968 and the provisions contained therein.
If a pharmacy could not obtain ‘Lipitor’, the world’s best selling drug, the entire prescription would be unable to be dispensed. Therefore in a single action, UK independent pharmacies would lose 10% of their revenue. More importantly patients, many of whom value their independent pharmacy, would not be able to use them. This would clearly be a breach of competition law and the rights of patients to choose their provider of healthcare (pharmacy).
The Pharmacy Act 1954 and the Medicines Act 1968 and European Directives, specifically provides pharmacists and pharmacies to be allowed free and un-restricted access to their right to dispense medicines that have received approval for use in the UK for patients. Any subsequent impediments are all imposed unilaterally and unlawfully by pharmaceutical companies.
In the UK, the competent agency for licensing medicines for human and veterinary use, as well as enforcing the medicines act, is the Medicines and Healthcare Products Regulatory Agency (MHRA). The MHRA issues Marketing Authorisations (MAs) for each product before it can be dispensed or sold in the UK. The European Medicines Agency (EMA) is the pan-European licensing body which grants licences for the marketing and distribution of medicines in line with European union Policy.
The MHRA is the regulator for the pharmaceutical industry but has failed to act yet in enforcing the legal obligations of the drug companies. This directly contravenes the purpose of Article 81 Treaty as outlined below:
Directive 2004/27/EC added an amendment to the second paragraph to Article 81 of the Directive according to which the holder of a marketing authorisation, as well as the distributor are obliged to ensure a stable and continuous supply of the products sold.
Until 2008 and the introduction of DTP ‘Direct to Pharmacy’ by Pfizer Plc, pharmacies could obtain their medication from many wholesalers in the UK. There were a few national wholesalers, Unichem (now Alliance Unichem Ltd). AAH pharmaceuticals Ltd, Phoenix Healthcare Ltd, Mawdselys, Sigma Plc, Colorama and a myriad of smaller regional wholesalers. All wholesalers offered EU procured medication. Pharmacies could order without restriction from any of these wholesalers any branded or generic medication. Choice of wholesaler was dependant upon price of product, service and in particular delivery intervals, as medication cannot be delayed to a patient.
Alliance Unichem also owns Boots the Chemist, AAH own Lloyds Chemists and Phoenix Healthcare own Rowlands Chemists. Hence the result of independents fearing that the vertically integrated businesses shared commercial data about buying patterns.
The role of wholesaling is reducing costs, thereby making drugs more accessible to more people; they act as intermediaries between the manufacturer and the place of dispensing the drug on a prescription, normally a pharmacy.
The wholesaler can procure medicines from several manufacturers and the pharmacy can buy the cheapest equivalent medicines and can improve supply to the patient and generate competition between manufacturers to reduce their prices and improve their efficiencies.
In case of branded drugs where the pharmaceutical manufacturer has a patent for 15 years on a drug, a wholesaler cannot procure any alternatives as there is only one manufacturer of this drug. In essence wholesalers increase competition, reduce prices, provide more choice and by consequence make vital drugs such as cancer therapies more affordable to all citizens of the UK and EU.
Pharmaceutical company’s arbitrary collection of data in a discriminatory and non uniform manner, creates an entirely separte issue. It is ONLY applied to UK citizens and not to EU citizens. Therefore the policy itself is in contravention of the Lisbon Treaty and the rights of an EU citizen.
It must be remembered prior to 2007 ECJ (initial) ruling; no stock shortages occurred in the UK and the UK was a net importer of medicines from Europe. This saved over £500m per year in drug costs which the government reclaimed from the pharmacists via the National Drug Tariff reductions as well as an overall reduction in pharmacy profits pursuant to the National Health Service Act.
In fact this is the essence and purpose of free trade and competition!
Pharmacy and pharmacists are governed by the provisions of the Pharmacy Act 1954. All the provisions are universal to the profession and there is no specific restriction or requirement pertinent to practicing pharmacy or dispensing drugs in accordance with the Medicines Act 1968. This is important as the defendant is restricting supply to ‘homecare pharmacies’ in contravention to the National Health Service Act 2006 and the provisions of the Pharmacy Act 1954 and Medicines Act 1954.