February 10, 2006

Dutch health insurer Menzis has won a court case allowing it to offer bonuses to doctors that prescribe cheaper generics instead of branded drugs. Menzis expects the reforms to generate savings of EUR3.2mn (US$3.83mn) per year.

Domestic drug industry associations have been critical of the scheme claiming that insurers should not exercise an influence on healthcare professionals. However, the court has ruled that there is nothing to suggest that the incentive scheme will make doctors deviate from accepted standards of behaviour.

In early 2004, the Dutch government implemented a series of measures aimed at reducing drug prices in the country, which included a greater emphasis on generics and parallel imports. A new social insurance system, which encourages competition between insurers, has also resulted in a greater emphasis on low-cost copy drugs.

The impact of these policies coupled with the fact that a number of major branded drugs are set to come off patent in the near future should see the generics market grow robustly in the short term, reaching EUR4bn (US$4.79bn) by 2009.