Greek hospitals and pharmacies are running short of around 300 medicines because drug companies are refusing to supply them.

Hospitals failing to pay drug bills and parallel trading by wholesalers and pharmacists are the main reasons for supplies being withheld.

Major pharmaceutical companies that have admitted halting shipments of some products include Pfizer, Roche and Sanofi.

Medicines for arthritis, hepatitis C and hypertension, statins, antibiotics, anaesthetics, antipsychotics and antidepressants are all affected.

Dimitris Karageorgiou, Secretary General of the Panhellenic Pharmaceutical Association, said: “I would say supplies are down by 90%. The companies are ensuring that they come in dribs and drabs to avoid prosecution. Everyone is really frightened.

“The government is panic-stricken and the multinationals only think about themselves and the issue of parallel trade because wholesalers can legally sell them to other European nations at a higher price.”

According to the Greek government, more than 50 companies are holding back products or planning to do so. The Ministry of Health is intending to fine eight major drug companies, which have not been named.

There are reports of widespread panic and anger among patients who are going from one pharmacy to another with prescriptions. “We have reached a tragic point,” commented Karageorgiou.

With austerity tightening in Greece, the debts owed to pharma companies by hospitals and social insurance funds has reached €1.9bn (£1.6bn).

Pfizer has admitted withdrawing four medicines “because alternatives were available and because of the parallel trade situation”: leukaemia drugs Zavedos and Aracytin, the analgesic Neurontin and the epilepsy treatment Epanutin.

Roche said it was withholding supplies to Greek public hospitals, apart from “critical medicines” such as HIV drugs, but was still supplying pharmacies.

Sanofi claimed it was still supplying public hospitals with life-saving and unique products (for which no generic version or recommended alternative exists).

GSK, AstraZeneca, Novartis and Boehringer Ingelheim denied they had stopped supply of any products to Greece.

The pharmaceutical industry has urged the Greek government to set its drug prices in accordance with a eurozone standard. Greek drug prices are 20% lower than the next lowest in the EU, giving rise to widespread parallel trading.

Greek regulator the National Organisation for Medicines has banned the export of 60 medicines and is considering another 300. It will fine wholesalers and pharmacists who have broken the export ban.

The European Federation of Pharmaceutical Industries and Associations (EFPIA) has offered Greece a cap on its drug expenditure in return for immediate payment.

The offer, made on behalf of Europe’s major pharmaceutical companies, reflects a growing industry awareness of the depth of Greece’s economic crisis.

In addition, the strategy represents a potential blueprint for comparable healthcare funding crises in Ireland, Spain, Portugal and even the UK.

In a letter to the Greek ministers of health and finance, EFPIA offered to accept a national ceiling on outpatient pharmaceutical drug bills of €2.88 billion in 2012, in return for settlement of outstanding debts and no delays in future payments.

Last month, the Greek government suspended all drug exports from the country in order to prevent domestic shortages.

Richard Bergstrom, Director General of EFPIA, said that major pharmaceutical companies were showing a more flexible attitude towards Greece due to the worsening economic climate across Europe.

“Setting a growth cap or budget ceiling is not something we have ever liked to do in the past, but in the current environment it is better to do that and have some stability,” he said.

“We’ve suggested this to a number of other governments as an approach to deal with the financial crisis.”

Interim trade agreements to ensure drug payments have been developed for Portugal, Ireland and Belgium, and could be extended to other crisis-hit economies including the UK.

This week, German pharmaceutical company Merck KGaA said it was no longer making its cancer drug Erbitux available to Greek hospitals.

Health Secretary Jeremy Hunt has said it’s “not possible to make a prediction” on whether the NHS budget will remain protected.

In his first interview in his new role, Hunt said that whether Lansley’s promise to ‘ring-fence’ the NHS budget could be honoured would depend on “the eurozone”.

Hunt also said the Government was trying to decide whether there was “any way at all” of following the Dilnot recommendations on social care reform, including cheaper variations on it.

Speaking to The Spectator, a strongly Conservative journal, he said his aim as Health Secretary was to “safeguard Andrew Lansley’s legacy”.

The shift in leadership at the DH was due to a need for it to communicate how the reforms will “make a difference to patients”, he said – confirming speculation that Hunt’s more ‘personal’ presentation style was a key factor.

While he said his “instinct” was to protect the NHS budget, Hunt insisted that it could no longer be a commitment due to economic “uncertainty”.

Asked whether the Dilnot proposals might be realised from the NHS budget (as the Treasury is said to favour), he said that would be “extremely difficult”. However, he said, “other versions” of the Dilnot plan with a lower cost would be considered.

In clinical terms, Hunt stated his priorities to be: care for the elderly and those with long-term conditions, dementia care and achieving “the best cancer, heart and stroke survival rates in Europe”.

Finally, he expressed the aspiration of delivering a “measurably better” NHS that patients would recognise as such.

Major pharmaceutical companies are in discussion with European authorities to develop an emergency plan to maintain medicine supplies to Greece.

The country’s potential exit from the euro threatens the continuity of drug reimbursement and supply to patients.

An agreed solution may involve delays in payment for critical medicines to ensure short-term supplies during a phase of greater economic disruption.

Greece imports all of its medicines, relying heavily on branded products from European companies including AstraZeneca, GSK, Novartis and Roche.

Drug suppliers are already owed €1.21bn by Greek state hospitals, and their approaches to the crisis vary: Novo Nordisk is demanding immediate payment, but GSK is not; Roche is supplying only to pharmacies, not to public hospitals.

Shortage of drug supplies is already affecting many Greek patients.

The industry’s strategy may have wider implications as the economic crisis spreads across the EU, with Spain, Ireland and other countries facing similar breakdowns in drug import trade.

Europe is falling behind the US and Japan as a market for innovative drugs, according to GSK Chief Executive Andrew Witty.

The Eurozone crisis means that EU countries are taking longer to approve new drugs, are paying less for them and are taking longer to pay.

While the EU markets are “slipping”, Witty said, the US remains more receptive to innovation and Japan is improving its uptake of new drugs.

The result is that even European pharma companies such as GSK and Bayer are looking to cut back their EU operations and invest in more rewarding markets.

In 2010, the US accounted for 61% of all sales of new drugs (launched in the previous five years), while Europe made up only 22%.

In Japan, 48% of GSK’s sales in 2011 were of new products – while regulatory changes are set to further accelerate the uptake of innovative drugs.

In Europe, reimbursement is increasingly a matter of contention between health authorities and pharma. Germany has introduced a 16% mandatory rebate on all prescriptions and a value-based pricing scheme that some companies have judged unacceptable. France and the UK are also seen as resistant to new drugs.

Industry concern is also growing over the potential impact of price cuts in Greece and Spain on reimbursement in other EU countries.

“Europe has unfortunately slipped in terms of its willingness to pay for innovation,” commented Andrew Witty. “We’re now at a point where we have to face the reality that really it’s about the US and, excitingly anew, it’s about Japan in terms of where innovation should be driven.”

Despite the global nature of the economic crisis, Witty argued, health policy in Europe was “stuck in a bad place” and falling behind other regions.

Witty’s views were echoed by Richard Bergstrom, Director General of EFPIA, who said: “Everybody in the industry thinks the same way. The euro crisis has triggered the worst in the national governments.

“People in governments don’t seem to realise the risks they are taking, both in the short term with supplies and longer term with innovation.”