In Spain, the government has implemented increases of as much as 56% on the prices of drugs used in the treatment of chronic conditions, and on July 1 it will introduce a new mandatory co-payment of up to 60% on all prescription drugs.

The price rises will apply to around 4,000 drugs used in the treatment of chronic diseases, and while the increases will be as much as 56% in some cases, the prices of most products are to be increased from an average of 2.64 euros to 4.13 euros, according to local reports.

The lowest of the new co-payments being introduced next month will be for retirees, who will be required to pay 10% of the cost of their medicines, and the contribution will rise to a maximum of 60% for employed adults.

Both measures are being introduced under the Royal Decree 16/2012 healthcare austerity package, which came into effect in April, but analysts at IHS Global Insight say that while these moves might prove effective in the short to medium term, they are unlikely to be sustainable over a longer period. Protests against the new mandatory co-payment may be strong, as it will affect consumers' purchasing capability "as well as heaping more financial woe on patients who may not be able to afford the drugs they need," the analysts point out.

The Health Ministry recently reported that, in the year to April 2012, Spain's total national pharmaceutical spending fell 5.28%, to a total of 860.8 million euros, with many of the country's 17 autonomous regions having made big savings on their drug expenditures.

The decline in drug consumption for this year is expected to be far greater, with the Spanish drug industry association Farmaindustria forecasting a drop of 15%-20% as a result of the government's continuing attempts to reduce health spending. However, the industry group also warns that 1.5 billion euros-worth of unpaid medical bills accumulated by the autonomous regions since January 1 this year alone remain outstanding, and that many of the regions are racking up debts faster than they did in 2011, Reuters reports.

Hospitals in Spain owed drugmakers more than 6.3 billion euros by the end of 2011, according to Farmaindustria, but the government has said that these debts will be cleared by the end of this year, and that in fact it expects this to be achieved this month. Three-quarters of the 17 billion euros being provided to pay the region's overall debts will be used to pay their health care bills, the Health Ministry also notes.

Reuters quotes Farmaindustria as estimating that the healthcare austerity measures introduced from April will cost the pharmaceutical industry almost 3 billion euros, and calling on the government for support to help it create jobs and increase exports.