What Costs in Medicines? A Study on Regulation and Control of Pharmaceutical Prices

Kinnunen MariLaukkonen Marja-LisaLinnosmaa IsmoMäklin SuviNokso-Koivisto OskariSaxell TanjaSiikanen MarkkuToivanen OttoValmari Nelli

Abstract

The study investigates the operation and regulation of the prescription drug markets in outpatient care as well as the duties and operation of pharmacies in social and health care. Work package A investigates the pricing of prescription drugs in outpatient care as well as ways of regulating and controlling wholesale prices. The results based on wholesale prescription drug data show that the real growth in outpatient prescription drug costs in Finland has been strong during the past 20 years. The vast majority of outpatient prescription drug costs, approximately 80%, were caused by originator medicines. After the expiry of patent protection, originator medicines do not engage in price competition as strongly as generic medicines. There is very little parallel importation of medicines in Finland. We also discuss regulation measures to reduce prescription drug costs and promote rational medical treatment, based on the results and literature.

Work package B states that strict regulation of the pharmacy system may impair pharmacists’ incentives to develop their services. The study shows that opening hours and the range of pharmaceutical and health services offered varies between pharmacies. They mostly offer various types of medication use reviews and dose dispensing services. Development of services is slowed down by fragmented nature of the pharmacy system as well as lack of national steering. In the future, national steering of services could either be based on pharmacies’ statutory tasks or on economic incentives. Assessment of the pharmacy system requires clear objectives and appropriate indicators.

Publications of the Government’s analysis, assessment and research activities 2021:19.

Publication info

Results of research
What costs in medicine?
Research group
Growth, international trade and competition
Date
19.03.2021
Keywords
Medicines, Pharmacies, Regulation, Outpatient Care, Costs
Pages
157
Language
Finnish
Publication on other services
urn.fi