Generics And New Industry Pact Mark 1996 In Spain

1996 was a busy year for Spain's pharmaceutical industry, and one inwhich the key drug industry issues of generics and reaching a new deal with the Health Ministry on health care spending were marked by general elections that brought in a new government, reports the Spanish pharmaceutical industry association, Farmaindustria, in its 1996 annual report.

The arrival of a new government in Spain in May last year, combined with pressure on it to meet the European Union's Maastricht criteria resulted in drastic cut-backs in public spending and public sector salary freezes, sayd the report. The Ministry for the Economy exerted its pressure on the Health Ministry which, in turn, translated this into a number of key policies affecting the pharmaceutical industry.

The agreement between the drug industry and the government on drug companies' profit margins was renegotiated, but with the same goal of controlling public spending on medicines. A 2.6% limit was fixed for the period from June 1996 to July 1997, and for July 1997 to June 1998 a ceiling of 3.6% was agreed. Growth above these levels would result in the firm making an excess payment to the government.