For the first time, seniors in Spain are to be required to pay part of the cost of the drugs which they now receive free through the health care system, the government has announced.

All but those on the lowest pensions will be required to pay a 10% co-payment for their medications, but the bills will be capped at 8 euros a month for those living on less than 18,000 euros a year and 18 euros a month for those earning more. For most, the new costs are expected to be no more than 2-3 euros a month, said Healthcare Minister Ana Mato.

People in employment will also have to pay higher co-payments, which are set to rise from 40% at present to 50%-60%. People earning more than 100,000 euros a year will pay the top rate, but this will be capped at 60 euros a month.

The co-payments form part of a new range of cuts to healthcare services aimed at producing annual savings of 7 billion euros. The government does not expect to receive much income from the co-payments, estimating around 150-200 million euros a year, but the aim is to improve the use of subsidised medicines and curb excessive spending on them, said Ms Mato. "We know tons of medicines end up in the garbage bin," said the Minister, adding that officials will be discussing with drugmakers the possibility of supplying medicines in smaller packs, adapted to the treatment's duration, which would reduce wastage and save an anticipated 1 billion euros a year.

The package of measures also includes a new central purchasing system for prescription drugs, along the lines of the government's existing vaccines procurement facility, which it anticipates will save around 1 billion euros. A further 400 million euros will be derived from the removal from the national healthcare system of drugs deemed to be of little or no therapeutic value, plus 500 million euros from the use of health technology assessments (HTAs), 350 million euros from wider use of generics and as much as 1 billion euros from a clampdown on "health tourism."

Analysts at IHS Global Insight comment that, while the new co-payment system was largely anticipated, the level of payments is at the high end of expectations and it "represents a deep and meaningful negative development for the pharmaceutical industry." However, they add that it could have been much worse, given that this is the first time that Spain has not adopted price cuts as part of healthcare cost containment.