Belgian Austerity Package Hits Drugs

The Belgian government has announced an austerity package worth a totalof 17 billion Belgian francs ($470.5 million), which includes several measures aimed at drug companies.

These are: curbs on the prices of drugs and fees for dispensing medical care, worth 6.8 billion francs, of which 3.3 billion francs will come from reductions in state repayment of medicines; and 2.4 billion francs from the continuation of a 4% tax on drug industry turnover.

The aim is to cut the budget deficit to 2.3% of Gross Domestic Product from 2.8% this year, according to a joint statement by the Belgian budget and finance ministries. The Belgians are among the biggest pill-poppers in the world, said Budget Minister Herman van Rompuy, adding that putting limits on doctors' prescribing behavior will curb consumption. In this case supply creates demand, he said, noting that doctors' prescribing behavior will be monitored from 1998.