International trends in generics: the EU

Generics/Research | Posted 30/08/2010 post-comment0 Post your comment

Few studies have conducted an international price comparison of generic medicines as it is hard to access comparable data. A 2007 study by Prof. Dr. Steven Simoens examined national pricing policies in some EU countries and related them to generics prices (see Table 1).

Table 1: Generic medicine pricing policies and generic prices in selected countries in 2005

Country Generic medicines pricing policy Average factory gate prices for selected generics, 2005 (Euros)
Belgium Generic medicines priced at least 30% lower than the original medicine 0.206
Denmark Generic medicines priced below the price level of original 0.104
Finland Free pricing system 0.220
France Generic medicines priced at least 40% lower than the original medicine 0.254
Germany Free pricing system 0.269

The

Netherlands

A system of maximum prices based on reference country prices 0.260
Norway A step-price system is in place that cuts the generic medicine price after a period of time 0.171
Sweden Regulated generic medicine prices system 0.123

United

Kingdom

Free pricing in a competitive environment 0.222

It is clear that another factor is affecting the price of generics, as the pricing policy does not directly govern the average price of generics. If the data is analysed from the perspective of maturity of the generics market, it can be seen that those countries in which generics have been established over a longer period of time pay less for their medicines (see Table 2).

Table 2: Generic medicine prices compared to regulatory approach and level of development of generic medicine market in 2005

Generic medicine prices and regulatory approach towards generic medicine pricing
Free market pricing Pricing regulation
Country Average price level Country Average price level

Finland

Germany

United Kingdom

0.237

Belgium

Denmark

France

The Netherlands

Norway

Sweden

0.186
Generic medicine prices and level of development of generic medicine market
Developing generic medicine market Mature generic medicine market

Belgium

Finland

France

Norway

0.213

Denmark

Germany

The Netherlands

Sweden

United Kingdom

0.196

The international price variation suggests that generic medicine companies do not set prices at a common European level, but adapt their price setting strategy to the regulatory environment surrounding generic medicines in each country. The generic medicine price level was lower in countries that regulate prices and in countries that have a mature generic medicine market.

(see also International comparison of generic medicine prices)

Reference

Simoens S. International comparison of generic medicine prices. Curr Med Res Opin. 2007;23(11):2647–54.

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