German generics see drug majors cut prices

Discount deals between German drugmakers and health funds are having an increasing influence on pharmaceutical market prices. Major drug companies have been cutting the prices of their original, off-patent products to such an extent as to put generics producers under intense competitive pressure.

Heinz Werner Meier, head of Sanofi-Aventis in Germany, said they are basically ready to compete directly with generic drugmakers. His own company has already concluded a far-reaching agreement with a leading supplementary (EK) fund covering an entire package of drug products, he noted.

Janssen-Cilag, a subsidiary of Johnson & Johnson of the USA, and Lilly Deutschland have also concluded agreements with various funds. Janssen-Cilag's deal with the North Rhine local fund (AOK) is over its schizophrenia treatment Risperdal (risperidone). Lilly has signed accords with a number of local funds for its own schizophrenia drug Zyprexa (olanzapine). A spokesman for the German subsidiary of the US drug major said that he thought more producers of original drugs whose patents had expired would follow suit.