Energy-European generic drug makers could cut production

FRANKFURT, Sept 28 (Reuters) – European drugmakers have warned they may stop producing some cheap generic drugs due to rising electricity costs and are calling for a review of how they are priced, as the energy crisis deepens.

Generic drugs industry association Medicines for Europe (MFE), which represents companies such as Teva, Novartis’ Sandoz unit and Fresenius’ Kabi business, sent an open letter to energy ministers on Tuesday. and Health of the Member States of the European Union as well as to the European Commission.

According to the letter, the price of electricity has increased tenfold for some drug factories in Europe and the cost of raw materials has increased by 50 to 160%.

The Union’s generic drug associations are also asking national health authorities for more flexibility on drug prices, the group said.

“Rising energy costs are only eroding the margins of many essential drug makers under Europe’s fixed price system,” said MFE chief executive Adrian Van Den Hoven.

Generic drugs make up around 70% of all medicines dispensed in Europe, many of them to treat serious illnesses like infections or cancer, but make up just 29% of the region’s drug bill, according to MFE.

According to Elisabeth Stampa, managing director of Medichem, a generic drugs and pharmaceutical ingredients manufacturer based in Spain, three or even five products are at risk of being discontinued due to the direct and indirect impact of energy prices.

Off-patent drugs are usually sold by discount drug makers at prices set by national health agencies or insurer associations, which often discount prices.

Soaring energy costs risk undermining efforts to make the region more self-sufficient, as the COVID-19 crisis and war in Ukraine have compounded raw material supply problems.

The EU’s 27 energy ministers are due to meet on Friday to try to agree on measures to ease Europe’s energy shortage.

However, a spokesman for the Czech EU presidency, which is in charge of leading the meeting, clarified that the forthcoming talks did not include measures targeting the pharmaceutical industry at this time. (Report Ludwig Burger, with Emilio Parodi in Milan and Gabriela Baczynska in Brussels; French version Dina Kartit, edited by Kate Entringer)

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