Swiss doctors prescribe several generic drugs – with expensive consequences

A pack of 20 tablets of Paracetamol Sandoz in a Swiss online pharmacy costs 2.50 francs. At a comparable German online pharmacy it costs 0.49 euros. An extreme example, but by no means an isolated case.

On average, generic drugs, ie drugs whose patent protection has expired, cost almost 50 percent more in Switzerland than abroad. The price difference between Switzerland and other countries for patent-protected drugs is close to 9 percent. This was the conclusion reached in the spring of an assessment by the health insurance association Santésuisse and the industry association Interpharma.

So it’s not surprising, in a Sotomo survey, that 94 percent of Swiss people choose to start with drug prices to reduce healthcare costs.

Doctors collect higher margins

Survey respondents argue that more generics should be sold rather than branded products. 22 percent of all drugs sold in Switzerland are generic drugs. In Germany, the rate is 83 percent!

The health insurance association Santésuisse assumes the potential for savings of 200 million francs per year, or 18 percent, if generics are consistently used instead of the originals. “You get the same health at a lower price,” sums up health economist Tobias Müller (36) at the University of Applied Sciences of Bern.

The fact that this is not in Switzerland is also due to the fact that medical practices get higher margins when they sell the originals. You get a percentage. If the original pill costs 10 francs, there is a higher margin than the 5 franc generic pill. “Clearly false incentive,” Müller criticizes. “The doctors are picking cherries.”

Generic drug prices are falling

The patients themselves also play a role. Many use the original rather than the habitually generic. Germany has a reference price system: basic insurance only pays for cheap generic drugs. If you want the more expensive original, you need to pay the additional cost yourself. In Switzerland, the parliament had rejected this model two years ago.

But even if more generics were prescribed instead of the originals, Switzerland would still have to deal with higher costs. Because generic drugs in this country are more expensive than cross-border ones. This is due to high production costs. But according to experts, it’s because Swiss patients are willing to dig deep into their pockets.

The pharmaceutical industry disagrees. Lucas Schalch, 58, Managing Director of the Intergenerika association, argues that the price difference is due to the small, fragmented Swiss market: “Here it takes more effort to bring a product to market. It takes three languages.”

In Switzerland, the prices of patent-protected drugs are reviewed every three years by the Federal Office of Public Health. Generic prices are also based on these prices. “As a result of the review, generic drug prices have dropped 45 percent over the last 20 years,” Schalch calculates.

Is supply security at risk?

The industry argues that cost reductions and a reference price system will ultimately compromise security of supply. The lower the price, the cheaper it is for manufacturers to produce. They outsource their production to Asia, which causes bottlenecks and in the worst case, delivery bottlenecks. The Federal Office of Public Health (BAG) currently has 89 products on its list of essential drugs that are supply bottlenecks. In terms of security of supply, Switzerland is in a much better position than other countries. “Manufacturers serve those who pay the highest price first,” explains health economist Müller.

In extreme cases, cost reductions can mean that generics aren’t even marketed – and patients have no alternative to the original. “The so-called cost savings will be boomerangs,” warns Intergenerika boss Schalch.

Ricola is more expensive than painkillers

One way or another: The really big lever in healthcare costs isn’t drug prices. According to industry figures, they make up 12 percent. “This value has remained stable over the past seven years,” Novartis Switzerland boss Matthias Leuenberger (57) said in a recent Blick interview.

This is especially evident in everyday medicines: 20 packs of paracetamol from Sandoz are significantly more expensive in Switzerland than in Germany. When calculated according to the individual tablet, the unit price is 12.5 centimeters. A single Ricola vegetable candy costs just under 14 inches.