WHO & HAI Medicine pricing matters

Publication date: 2008

facilities was very poor. For example, 16 of the 35 surveyed medicines were not found in any outlet surveyed in Yemen and 23 of the 29 medicines were not found in more than 50% of Pakistani outlets surveyed. • In the private sector, extre m­ ely high prices were char ged for originator brands and lowest priced generics. In Sudan, for example, patients were paying 18 times the international refer ence prices for origi nator brands. Lowest priced gene rics cost more than five times the reference price in most countries. • Most treatments purchased in the private sector were judged to be unaffordable for those living on a low income. • Some countries were apply­ ing taxes to essential medicines. Zafar Mirza’s presentation was followed by comments from delegates representing 16 coun tries and discussion con ­ ti nued for well over two hours. Delegates suggested a number of policy options, including the increased use of quality gene­ rics to improve affordability, regressive mark­ups to encou­ rage the dispensing of lower priced generics, pooled pro ­ cu rement, as well as greater trans parency and the sharing of price information. MEDICINE PRICING MATTERS | NUMBER 1 | PAGE 1 Focus on pricing policies EMRO ministers confront high prices Expensive medicines, low availability and price compo­ nent issues were key concerns expressed by delegates at the Regional Committee for WHO’s Eastern Mediter­ ranean region, held in Cairo from 20­23 October 2007. At the meeting, Dr. Zafar Mirza, WHO’s Regional Advisor on Essential Medicines and Pharmaceutical Policies, high­ lighted findings from 11 surveys conducted in the region using the WHO/HAI medicine price measurement methodology. In the presentation, price, availability and affordability data were compared across the 11 countries. National prices were also compared with international reference prices. Key results • Substantial differences in government procurement prices across the countries. • Government purchasing of expensive originator brands, as well as cheaper generics, in all but three countries. On average, originator brands were about three times more expensive than generics, and prices of generics were often high. • Availability in public sector “ With this important regional committee resolution a lot can be achieved in terms of enhan ­ cing access to essential medi­ cines in the region.” Dr. Zafar Mirza IMPROVING THE AVAILABILITY AND AFFORDABILITY OF ESSENTIAL MEDICINES Continued on page 4 ➤ Pi ct ur e: W H O MEDICINE PRICING MATTERS MEDICINE PRICING MATTERS PAGINA 1 MEDICINE PRICING MATTERS | NUMBER 1 | PAGE 2 For more than a year, the Kenyan Ministry of Health, in collaboration with WHO and HAI Africa, has been conducting quarterly mon­ itoring of prices, availabil­ ity and affordability in the country. Data collected in July 2007 showed median availability of the 37 surveyed medicines to be 59% in the public sector, 91% in the private sector and 63% in the mission sector. Across all three sectors, medi­ cines were more avail able in Tanzania New tax on medicines In July 2007, the government imposed a 10% tax on most imported medicines with the exception of anti­ retrovirals, anti­TB drugs, antimalarials and all medi­ cines imported by the public sector. This decision will make medicines even more unaffordable than identified in the countrywide medicine price survey carried out by Tanzania’s Ministry of Health and Social Welfare in 2004. That study found, for example, that five days’ wages were needed for low­paid unskilled government workers to buy a month’s supply of metformin for diabetes when purchased in the private and mission sectors. In response to survey results, the government began monitoring prices, availability and affordability biannually starting in late 2006. The ministry recently released the Nov/Dec 2006 report (available on HAI’s website) and is currently finalising the June 2007 report. These reports will be circulated to all of the country’s health care facilities in an effort to make people more aware of medicine prices in the public, private and faith­based sectors. This monitoring will also be useful in detecting the impact of this new tax. Tajikistan VAT abolished to improve access Following a national price sur vey in 2005 by the Drug Information Centre in Dushanbe, the govern ment of Tajikistan removed the 20% VAT on medicines in May 2006. Based on the survey fin dings, this should lower add­on costs in the supply chain for im por ted medicines from 122% to 85%. PRICING NEWS Kenya Monitoring trends urban facilities than rural facilities. Prices were gene rally the same in the mis sion and private sectors. The report is available on HAI Africa’s website: www.haiafrica.org. HAI Africa and Kenyan NGOs are currently producing a film docu mentary of interviews highlighting the problems people face be cause of high medicine prices. Showing the docu men tary and lobbying for policies that improve treat­ ment affor da bi l ity and access to medicines will be priorities in 2008. Patrick Mubangizi, HAI Africa, and Rania Bader, Jordan survey manager, at a pricing meeting earlier this year. The Philippines Focus on affordability A 2005 survey showed the availability of medicines in public sector facilities was only about 15% and prices were excessive ­ originator brands were 15 times the international reference prices, and lowest priced generics were six times. In private pharmacies availabil­ ity was also poor (33%) and prices were equally high. Many treatments would simply not be affordable for low­ paid workers. In response to the findings, survey manager Dennis Batangan and others in the Philippines produced a video highlighting the problems people face when treatments are unaffordable. To view the video go to http://www.youtube.com/ watch?v=hTVjZjGmyoQ MEDICINE PRICING MATTERS PAGINA 2 China Advocating for change Following confirmation that some patient prices were very high in both the public and private sectors in Shangdong province, the research team at the Center for Health Management and Policy of Shandong University has taken up advocacy work to improve the situation. At a national meeting in Beijing to discuss the survey results, they recommended that a price monitoring and reporting system be esta ­ bli shed to better under stand price variability over time. The team published a bulletin to inform the public about the price differences between originator brands and generic medicines when purchased at public hospitals and private pharmacies. They also inves­ tigated knowledge and use of medicines by 117 residents in the provincial capital Jinan. They found those surveyed preferred buying medicines at private retailers because they were conveniently located and prices were often cheaper than in public health centres (except for paediatric medi­ cines which they preferred to buy from hospitals). MEDICINE PRICING MATTERS | NUMBER 1 | PAGE 3 Jordan Tackling price and access problems High retail prices and poor public sector availability are just some of the findings revealed in the Jordanian price survey conducted in 2004. The researchers, from the Jordanian Food & Drug Administration (JFDA), found that medicine prices obtained through public procurement were accep­ table for generics but some higher priced origin ­ ator brands were being purchased. They also found that the availability of medicines in public sector facilities was poor, limiting access to low­cost generic medi cines. In addition, medicine prices in private phar ma­ cies were high (originator brands were 17 times the inter­ national references prices, and lowest priced generics were 10 times). Therefore, some treatments were unaffordable to low­income groups. In December 2007, 80 health policymakers and others will meet at the Dead Sea to discuss the evidence and recom­ mend ways to make medicines more available and affordable in the country. The discussions will focus on procurement methods, price setting in the private sector and improving treatment affordability through pro­generic policies and programmes. Delegates will also discuss the impact of intellectual property rights and trade agreements on access to affordable medicines. The participants, drawn from the Ministry of Health and other government agencies, pharmacist and physician associations, NGOs, local industry and donor organisations, will identify specific policies that could help boost medicine availability in the public sector and reduce prices in private outlets. In addition, a national monitoring system will be developed to assess the impact policy changes have on price, availability and affordability over time. The workshop is being held under the patronage of his Excellency, Minister of Health Dr. Salah Mawajdeh and has been organised by survey manager, Rania Bader. It is co­hosted by the JFDA and HAI. Kuwait No progress yet To date, the medicine price sur­ vey report given to the Ministry of Health by investi gators at the University of Kuwait seems to have had no disce rna ble impact. While the govern ment subse ­ q uently told the press it would review or replace the Kuwaiti­ only list (about 70 medicines provided free in the public sector to Kuwaiti nationals, but not to others), no action has been taken. Interestingly, those surveyed were more concerned about efficacy and quality than price. Most preferred buying branded products believing they were of higher quality and would lead to better health outcomes. While most said they gained information about medicines from newspapers and TV adverts, they felt the government should be infor­ ming people about prices, quality, efficacy, usage and side effects through free pam­ phlets, newspapers and TV. All pricing survey reports and data can be found on HAI’s website: www.haiweb.org/ medicineprices MEDICINE PRICING MATTERS | NUMBER 1 | PAGE 4 Upcoming events 4-5 December 2007 Towards equitable and affordable medicine prices policies in Jordan Hosted by the Jordan Food and Drug Administration and HAI Dead Sea, Jordan (by invitation) 28-29 February 2008 Consultative meeting on medicine price, availability and affordability monitoring Hosted by HEPS and HAI Africa, Uganda (by invitation) Contact Interested in learning more about medicine prices or conducting a survey? Then contact the pricing project’s coordinators: Health Action International (HAI) Jacob van Lennepkade 334-T 1053 NJ Amsterdam The Netherlands T (+31-20) 683 3684 W www.haiweb.org/medicineprices Margaret Ewen E marg@haiweb.org Akke­Jeanne Klerk E akke-jeanne@haiweb.org World Health Organization (WHO) Avenue Appia 20 CH-1211 Geneva 27 Switzerland Richard Laing T (+41-22) 791 4533 E laingr@who.int Alexandra Cameron T (+41-22) 791 3785 E camerona@who.int This bulletin is produced quarterly by HAI and WHO. New publications Continued from page 1 EMRO ministers confront high prices WHO’s Regional Director, Dr. Gezairy, stressed the sensitive yet important nature of the pricing issue and offered options for countries to reduce prices. HAI’s representative, Marg Ewen, urged countries to develop, implement and enforce evidence­based policies and programmes, and monitor their impact. Resolution adopted At the meeting, the ministers passed a resolution on price and access issues, featuring the establishment of a regional web­based hub to share information on medicine prices and pricing structures, as well as best practices in medicine manage ment. This innovative approach should help improve price transparency and empower governments when nego­ tiating prices. The resolution also urged governments to strengthen pricing policies (including public procurement of generics and enhanced competition amongst suppliers) and rationalise supply chain costs in the private sector. In addi­ tion, WHO EMRO resolved to support Member States in this work including the development of guidelines on pricing policies and sharing information on best practices in other regions. To read the full resolution and the technical paper presented by Zafar Mirza, visit WHO EMRO’s website: http://www.emro.who.int/rc54 Survey data can be found on HAI’s website: http://www.haiweb.org/medicineprices N ad ee m Ir fa n B uk ha ri, n ad ee m _i rf an @ ho tm ai l.c o m Region: a synthesis report of medicine price surveys undertaken in selected World Health Organization Eastern Mediterranean Region countries By Douglas Ball, Zafar Mirza and Margaret Ewen [in press] Drug prices Revision of pricing manual underway WHO, HAI and project mem­ bers are currently revising the price measurement manual and workbook based on field experience gained since the first edition was published in 2003. The second edition should be available in March/ April 2008. Those planning to conduct a pricing survey should contact HAI or WHO to obtain the draft second edition for use in their survey. Price components and access to medicines in Delhi, India By Anita Kotwani and Libby Levison [in press] Investigating price components: medicine costs between procurement and point of delivery: Report on initial field studies By Libby Levison [in press] Prices, availability and affordability of medicines in the World Health Organization Eastern Mediterranean

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