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Cost-cutting in Europe may affect generics sustainability

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According to a presentation by Mr Victor Lino Mendonça, the continued focus on short-term cost containment measures may lead to an unsustainable market environment for generics and biosimilars in the European Union (EU). Mr Mendonça gave his presentation at the International Generic Pharmaceutical Alliance (IGPA)’s 16th Annual Conference, which was held in Brussels, Belgium, 9–11 December 2013 [1].

Europe is a global hub for high quality generics and biosimilars. Most countries in Europe have both generics research and development and manufacturing sites. In fact, only Sweden does not have any manufacturing sites for generics.

As part of continued austerity measures being implemented by European governments, pharmaceuticals were the main target for reducing healthcare spending in 2013. According to the Organisation for Economic Co-operation and Development (OECD), expenditure on pharmaceuticals experienced negative growth (-1.7%) in 2013.

Nevertheless, such a focus on high impact and short-term cost containment measures may lead to an unsustainable market environment for generics and biosimilars, according to Mr Mendonça. National measures include external reference pricing, payback and claw back policies, price freezes and price cuts, and retail tendering. While national and EU legislation is adding complexity and cost for generics manufacturers. New laws affecting generics and biosimilars include variations regulations, the falsified medicines directive, pharmacovigilance legislation, clinical trials regulations and medicines in the environment.

Mr Mendonça concluded that stronger collaboration between the generics and biosmilars industries and EU and Member States authorities is needed to foster industry and to compete at global level.

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Reference
1. Mendonça VL. Review and market trends Europe. IGPA 16th Annual Conference, Brussels, Belgium, 9-11 December 2013.

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