Global Insight Perspective
On 1 April, new prescription forms were introduced in Japan, which allow generic substitution by pharmacies unless prescribers expressly forbid it.
Unlike previous changes to the prescription form, the latest modification has been endorsed by pharmacies, which have been given financial incentives to dispense generics for at least 30% of their prescriptions.
Local sources are predicting a surge in the use of generics in Japan, although some hospitals appear to still be refusing to allow generic substitution as a matter of policy.
The new prescription forms, which were introduced on 1 April, came hand in hand with the introduction of new incentives for pharmacies to dispense generics. Specifically, pharmacies that dispense generics for at least 30% of prescriptions will receive a financial premium.
Pharmacies Embrace the Change…
According to Pharma Japan, dispensing pharmacies have been enthusiastic about the new reforms. The publication quoted from the president of the Tokyo-based Medical Pharmacy chain, who commented: "The use of generics will rapidly become a way of life. We have never seen such a drastic change before." The change in regulations means that pharmacists are set to play an increasingly active role in offering advice to patients who bring in prescriptions that allow for generic substitution. In the case of Medical Pharmacy, its policy will be to offer two brands for each active pharmaceutical ingredient (API).
As might be expected, Japanese generics companies have thrown their full weight behind the new measures. A number of major players—including Sawai, Taiyo Yakuhin, and Nihon Chouzai—are reported to have taken out large advertisements in leading daily newspapers, encouraging consumers to make greater use of generics. In Sawai's case, the company took out full-page advertisements in 43 national and regional daily newspapers on 31 March and 1 April, carrying the proud announcement: "We have good news. It has become easier to choose generics."
…But Some Hospitals Show Resistance
However, although the new generic substitution rules have received overwhelming support from the pharmacy sector, some hospitals have proved to be highly resistant. According to a survey conducted by the Nippon Pharmacy Association (NPhA), which checked the prescriptions of six of its member companies on the first two days of April, some hospitals appear to have been operating a policy whereby none of their prescriptions allow for generic substitution.
One of these six members was Nihon Chouzai, which operates 250 pharmacies throughout the country. During the survey period, the company received prescriptions from just under 230 medical institutions. Of these, five institutions had not permitted any generic substitution, while an additional seven institutions prevented generic substitution in over 99% of cases.
Outlook and Implications
For a number of years, Japan's Ministry of Health, Labour and Welfare (MHLW) has been exploring new ways of promoting increased use of generics, as a means of reducing the government's healthcare expenditure. However, a previous modification to the prescription form, which was imposed in April 2006, failed to have the desired effect, given that most doctors chose not to tick a box that would have specifically allowed generic substitution (see Japan: 23 April 2007: New Japanese Prescribing Rules to Boost Use of Generics). In addition, pharmacists showed little enthusiasm for imposing generic substitution.The latest modification to the prescription form was approved by Japan's Social Insurance Medical Council (CSIMC; Chuikyo) in November last year and, critically, it managed to secure the support of pharmacy associations—largely on account of the new financial incentives (see Japan: 29 November 2007: New Generics-Friendly Prescription Form Receives Approval in Japan). Meanwhile, the Japan Medical Association (JMA) has also softened its previous resistance to generic substitution, although it appears that the policy employed by some hospitals does not yet reflect this.