Health Service Executive CEO Professor Brendan Drumm has said he is bewildered by reports that health service unions are considering work stoppages to protest against cutbacks to meet budget targets.
Speaking on RTÉ Radio's News at One, Mr Drumm said he did not accept that cutbacks of up to 2% would have a significant effect on patients.
Earlier today, the HSE said it would save more than €100m next year alone by cutting the price it pays to pharmaceutical wholesalers for the drugs it uses.
Under the new scheme, the HSE will cut the margin it pays on medicines by more than half from 1 January next year.
The cost of medicines used by the Health Service Executive has long been a bone of contention.
The mark-up by drug wholesalers on medicines used by the HSE is double the EU average at 17.6%.
The HSE plans to cut the margin it allows by a further 1% from January 2009.
The changes will apply to all medicines dispensed under the various HSE repayment schemes such as the Medical Card Scheme and the Drugs Payment Schemes.
Drug wholesalers have reacted angrily saying the reduction in the margin could lead to job losses in the sector, which employs about 1,300 people.
They also argue they will be forced to reduce their existing twice-daily delivery services to pharmacies which will affect patient services.
Today's initiative has been welcomed by the Minister for Health, Mary Harney.
