Generics manufacturers have spent €700m on FMD implementation, says BGMA

Exclusive: To date, European manufacturers of generic medicines have spent an estimated €700m in implementing the Falsified Medicines Directive, the British Generics Manufacturers Association has told The Pharmaceutical Journal.

Warwick Smith, British Generic Manufacturers Association (BGMA) director general

Generics manufacturers across the EU have spent €700m on implementing the Falsified Medicines Directive (FMD), the British Generics Manufacturers Association (BGMA) has estimated.

In a statement to The Pharmaceutical Journal, the BGMA said it made the calculation based on an estimate from the the generics representitive body Medicines for Europe, which suggests all manufacturers across the EU have spent €1bn on implementing the FMD, including buying the necessary IT systems and serialising packs.

With generics manufacturers occupying 70% of the European market, the BGMA has estimated that generics manufacturers alone have spent €700m on implementing the new legislation.

Warwick Smith, director at the BMGA, told The Pharmaceutical Journal that under the directive, “manufacturers are responsible for funding the IT system — both the European hub and the national verification systems”.

“There is what’s called the implementation phase, as we are building the system, and then the operational phase — which we’ve been in for four weeks,” he said. “That €1bn for all manufacturers, €700m for generic manufacturers, is the implementation phase.”

He added that the money goes toward “establishing the system plus the cost of serialisation: buying the kit to put on production lines, whatever contracts you need to generate and apply the serial numbers, any regulatory change plus setting up the system”.

In the UK, Smith said its 560 marketing authorisation holders for generics have spent “just short of £10m to build the system”.

Going forward, Smith said the initial cost “will move to an annual fee, which we think will be a little bit less and that will pay the running costs of the national system and our share of the running costs of the European hub”.

Across the EU he said the spend will likely “reduce over time, but not dramatically”.

While he said no UK estimate has been made as to how this will impact drugs prices, Smith said: “Obviously that cost has to be recouped and the only way to do that is in the price of the medicines.”

Research from Bogin, the Dutch generic and biosimilar medicines association, found that prices of medicines in the Netherlands, where medicines prices are set by the government, are likely to increase by an average €0.17 (£0.15) per pack.

This comes after it was revealed that the Department of Health and Social Care has halved its expenditure on generic price concessions in the past year.

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The Pharmaceutical Journal, Generics manufacturers have spent €700m on FMD implementation, says BGMA;Online:DOI:10.1211/PJ.2019.20206320

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