New Swiss generic drug rule to force discounts

The Swiss Federal Council has introduced a new measure to cut drug prices - this time in the generics sector. In order to be added to the list of reimbursable drugs and so qualify for health fund support, copycat medicines will now be required to be at least 40% cheaper than the corresponding original branded version.

At present, a generic's inclusion in the list of reimbursable pharmaceutical products meant it had to be 30% cheaper than branded originals. However, despite this rule, the cost of generics in Switzerland has been markedly higher than that in comparable European countries.

In response to this issue, the Federal Department of the Interior (EDI) has decided to introduce the new regulations. Meanwhile, in the case of generics for small therapy sectors, the price differential will remain at 20% in the expectation that this will create an incentive for companies to launch copy drugs with low sales volume on the Swiss market. The Federal Council said these measures would come into force in 2008 and could be extended to other areas.