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Throughout the drawn out negotiations of the Fourth Community Pharmacy Agreement between the Federal Government and the Pharmacy Guild, Federal Treasurer Peter Costello was busy telling anybody who would listen that the Pharmaceutical Benefits Scheme (PBS) was in urgent need of reform.
The PBS has already seen significant reform in the past 12 months with the advent of the Safety Net 20 Day Rule applying to how soon patients receive Safety Net entitlements and the price they will pay depending on frequency of dispensing of prescriptions.
There has also been the Generic Price decrease of 12.5% to all medications in a therapeutic group after the introduction of a new generic product.
Furthermore, there has been the increase in patient co-payment of prescriptions for both concession cardholders and general patients, along with annual indexation of Safety Net Thresholds.
These measures have resulted in a significant 'bottoming out' of the PBS, as it now grows at a rate of around 2%, lower than that of inflation.
An integral part of the PBS delivering savings to the Federal Government and the taxpayer is that of the Reference Pricing system and the introduction of Generic equivalents after patent expiry.
There has been much debate since the introduction of Free Trade Agreement (FTA) with the United States of how much impact there will be on the Australian PBS, especially in the area of 'evergreening' whereby Originator Pharmaceutical Companies can extend the patent life of a product with further applications to the relevant authority.
In the case of Australia, applications would be made to the Pharmaceutical Benefits Advisory Committee (PBAC) for introduction to the PBS.
Unfortunately, a recent decision by the PBAC to allow the introduction of Perindopril Arginine onto the PBS has caused a very sour taste in my mouth.
In case you haven't heard, French Pharmaceutical Company Servier and makers of Coversyl® (currently Perindopril Erbumine in 2, 4 and 8mg strengths) have successfully applied to have another salt (Perindopril Arginine) of their ACE inhibitor anti-hypertensive Perindopril included on the PBS from August 2006.
It is believed that Generic Manufacturers would be able to produce generic equivalents of the current Perindopril Erbumine molecule from December 2006.
Why am I so troubled by this decision?
Well firstly, it completely contravenes the spirit of Generic manufacture and distribution and the reference pricing system that is in place to deliver savings to the PBS.
Servier have cleverly manoeuvred a new patented item onto the PBS - retained the same trade name that is familiar to doctors, pharmacists and many patients - but squeezed an amended entity into it to ensure there is no threat to decreasing profits over the term of the patent.
I was recently informed by a Servier representative that from August 2006, Coversyl® will be distributed as Perindopril Arginine in: 2.5, 5 and 10mg strengths.
This would 'replace' the previous formulations of Coversyl® (Erbumine).
When asked of any therapeutic benefit of the new salt, I was informed that it could 'potentially have a longer expiry date' but it was basically to help ensure 'patent protection'.
This is not exactly earth shattering stuff, and certainly not cause for the Arginine salt to be included on the PBS.
So between August and December 2006 - doctors will be required to prescribe the Arginine salt to ensure supply as there is no guarantee by Servier that the Erbumine could be available.
In the past, originator companies have been able to absorb the impact of patent expiries by forming cross-licensing agreements with generic manufacturers to allow introduction of a generic product onto the market before patent expiry and sharing of the spoils.
This is an acceptable course of action as the patient still has the option of taking the original product, and there is no change to the strength or chemical entity of the medicine.
The decision by Servier to introduce the Arginine salt in different strengths will not require any cross-licensing agreements and therefore, they can enjoy all the profits derived from distribution of Perindopril.
However, it will cause significant confusion to patients who will, without warning, be prescribed and dispensed Coversyl® in a higher strength, with a different name and in different packaging. Patient compliance could be jeopardised if patients do not receive adequate counselling of the changes to the products, and now believe they are taking something different.
Unfortunately, Community Pharmacists will once again be left to carry the can in explaining the changes to patients and possibly doctors.
In my opinion, Servier have left their dash for the line a little too late in detailing these changes to Health Professionals if the Arginine salt is to become the mainstay of Coversyl® from August.
Of course, community pharmacists are much more accessible than our General Practitioner colleagues when it comes to liasing with Drug Company Representatives.
So once again you guessed it, it will be left up to Community Pharmacists to explain these changes to General Practitioners who have not been made aware.
Will Community Pharmacists be recognised or remunerated in anyway for this extra administration?
You've got to be kidding!
Many questions must be asked of the PBAC to make this decision any more palatable. Is there an assurance from Servier that Perindopril Erbumine and Perindopril Arginine in 'equivalent dosages' will produce the same efficacy and safety?
Will prescriptions for the original formulation of Coversyl® (Erbumine) be allowed to be used to dispense Coversyl® (Arginine)?
Or will patients be forced to return to their doctors to receive prescriptions specifically for the Coversyl® (Arginine)?
A few more swipes of Medicare cards may be required as doctors must re-consult with patients over Coversyl® changes - causing further increases in health expenditure.
There will be an administrative nightmare for Community Pharmacists trying to handle stock of both the Arginine and Erbumine salts in the interim, and also processing new PBS and wholesaler codes to be remunerated for and acquiring the differing stock.
It is still etched in the memory of many pharmacists the extra work that went into Astra Zeneca's Losec® (Omeprazole) going from Capsules to Tablet formulation, from 28 pack to 30 pack to combat entry of Generic products on the PBS.
I feel one mother of a Coversyl® induced migraine that makes the Losec® induced headache look like one of the mild tension variety.
By approving the listing of the Arginine salt on the PBS before expiration of the Erbumine expiry, the PBAC has effectively allowed Servier to evergreen Coversyl®.
Furthermore, it allows manipulation of the supply and distribution of their product to ensure patients are all switched over to the Arginine salt prior to Erbumine generic products entering the market.
It is extremely disappointing that when the Federal Government looks to recoup savings on the PBS, the first option considered is to reduce Community Pharmacy remuneration despite decisions by their own committees that jeopardise savings for the PBS.
This decision by the PBAC has opened the door for other originator companies to evergreen their product in a similar way with far greater damage to the PBS.
For example, what is to stop Pfizer applying for the listing of an alternative salt of Atorvastatin that can be produced and distributed before the patent expiry of Lipitor® (Atorvastatin Calcium)?
This decision will stab deeply into the heart of the Generic Manufacturing industry that have effectively been locked out of the market - and will produce a product after patent expiry that either patients or doctors do not even know exists.
So to answer the question of How Green is the Coversyl® patent.. about as green as a box of Coversyl®.
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