Greece took its part on Wednesday in the latest widespread strikes against austerity measures that swept across Europe, throwing travel networks into disarray and sparking violent clashes between police and workers. But for once Greece wasn’t at the forefront of the misery as the country has been thrown a couple more lifelines — not least by the European Federation of Pharmaceutical Industries and Associations (EFPIA) — securing it another (albeit temporary) ‘stay of execution’.
On Tuesday the country held a sale of short-term treasury bills, enabling it to gather almost enough cash to make its weekly EUR 5 bn (USD 6.4 billion) debt repayment. Without this successful bond auction, Prime Minister Antonis Samaras said Greece would have run out of money by Friday.
On Sunday, there was more helpful news when EFPIA offered to cap the cost of medicines supplied to Greece at EUR 2.88bn (USD 3.7 bn) for 2012, on the understanding that the government commits to paying off its outstanding debts. (Greece owes pharma companies nearly EUR1.4bn for invoices issued between January 2010 and July 2012.)
This offer followed the news that Merck had halted shipments of cancer drug Erbitux to Greek public hospitals. But the drug maker was keen to point out that this draconian measure was a one-off.
EFPIA reports European pharma has contributed nearly EUR 7 billion (USD 9 billion) — approximately 8 per cent of its annual turnover — in the form of rebates and discounts between 2010 and 2011 to Greece, Ireland, Italy, Portugal, and Spain.
Following EFPIA’s offer of a Greek cap, the question, says Ana Nicholls of the Economist Intelligence Unit, is whether pharma companies can get any concessions in return. “A deal that secures market stability,” she adds, “is certainly desirable for all concerned.”