Further Italian Drug Price Cut Possible In June

A new drug price cut in Italy is not to be excluded, says a Budget Ministry official, who points to June as a possible new deadline. The 2.5% price cut envisaged for January 1 actually took effect at the end of January, which could necessitate further cuts before summer, in order to comply with the cuts in state drugs spending set by the 1995 finance Act.

The one-month delay in adopting the price reduction provision means that there will be a 30 billion lire ($12.6 million) gap in the forecast savings by year-end. Moreover, according to the Budget Ministry official, the state's provisional accounts tend to overestimate the effects expected from the second 2.5% price cut which is to come into effect within a few days. This new cut affects only products of companies reporting a 10% turnover increase last year.

The 450 billion lire ($279.1 million) overall savings in pharmaceutical expenditures written into the 1995 finance law are also threatened by a third factor. According to the Ministry official, the provision, which calls for manufacturers to put on the shelf "optimal" packaging, may not be as effective as believed.