Hyderabad: Drug multinationals are campaigning hard in New Zealand against cheaper generic alternatives supplied by Indian firms to that country’s state-funded health schemes.
Pharmaceutical Management Agency Ltd (Pharmac), the New Zealand government’s medicines procurement arm for its health schemes, recently decided to switch from an expensive, off-patent branded drug to a cheaper generic alternative from Dr Reddy’s Laboratories Ltd (DRL), India’s second largest drug maker, in line with its policy to save money.
Safe alternative: Dr Reddy’s headquarters in Hyderabad. The firm is sole supplier of pantoprazole to New Zealand’s drug procurement body. Bharath Sai / Mint
Pharmac has decided to only fund DRL’s anti-gastric medication omeprazole from May 2009, prompting AstraZeneca Plc., the UK’s second largest drug maker, to launch a campaign to protect the market share of its branded version of more expensive omeprazole called Losec.
“Over half a million older New Zealanders will soon face a stark medical choice—pay for a longstanding medicine that was previously funded, or accept a government-funded generic alternative produced in India,” AstraZeneca said in a public release on 24 November. “The decision will be forced on approximately 640,000 users of New Zealand’s most prescribed brand for acid indigestion and reflux—Losec.”
A 30 pack of 40mg Losec costs NZ$29 (about Rs810 today), compared with NZ$3.6 for DRL’s omeprazole.
Pharmac said the switch will enable it to save at least NZ$29 million in five years. It has a budget of NZ$653 million for 2008-09, up NZ$17 million from the previous year.
Pharmac has labelled AstraZeneca’s claims as “scaremongering, motivated by the company losing the market for its product. AstraZeneca is putting out incorrect information, including overstating the number of patients taking its product.”
Pharmac said some 370,000 New Zealanders use omeprazole, about half the number claimed by AstraZeneca.
“We felt a response to the AstraZeneca media release was justified because it went further than simply marketing a product; it suggested problems with the generic. This was, by implication, both a criticism of the Dr Reddy’s product and of the regulatory authority (Medsafe),” Pharmac medical director Peter Moodie told Mint by email. “It was also unfair on the patients who, in our view, can trust the Dr Reddy’s product, which has been assessed as safe and effective for New Zealanders,” he said.
DRL also supplies pantoprazole—used to treat ulcers—to Pharmac for which it gained sole supply status on 1 June.