Medicine prices, availability, Medicine prices, availability,

affordability and component pricesaffordability and component prices

Margaret EwenMargaret EwenHealth Action International, The Netherlands

Coordinator WHO/HAI Project on Medicine Prices & Availability

Wider problems of medicine pricesWider problems of medicine prices

Medicines have variable and often high prices; unaffordable Medicines have variable and often high prices; unaffordable and unavailable and unavailable for large sectors of the global population; for large sectors of the global population; major burden on government budgetsmajor burden on government budgets

Burden falls directly on most patients in developing countries Burden falls directly on most patients in developing countries –until now little known about patient prices and how they are –until now little known about patient prices and how they are setset

Trade agreements can severely affect the price and Trade agreements can severely affect the price and availability of medicinesavailability of medicines

For medicines to be more affordable, appropriate and well-For medicines to be more affordable, appropriate and well-informed pricing policies are needed; many countries have informed pricing policies are needed; many countries have no such policiesno such policies

Prices of medicines are well above production costs so great Prices of medicines are well above production costs so great scope for reductionsscope for reductions

Uganda pharmaceutical surveyUganda pharmaceutical surveySept 2002Sept 2002

WHO/HAI Project on Medicine Prices & WHO/HAI Project on Medicine Prices & AvailabilityAvailability

improve the availability of improve the availability of affordable essential medicinesaffordable essential medicines

Develop a reliable methodology for collecting and Develop a reliable methodology for collecting and analysing price and availability data across analysing price and availability data across healthcare sectors in a countryhealthcare sectors in a country

Price transparency; survey data on a freely Price transparency; survey data on a freely accessible web site allowing international accessible web site allowing international comparisons comparisons

Advocate for appropriate pricing policies and Advocate for appropriate pricing policies and monitor their impactmonitor their impact

Launched at the World Health Assembly in 2003

Measures:• patient prices• public sector procurement

prices• availability• treatment affordability• price components in the supply chain

About 50 surveys to date in all regions

Monitoring tool in development

Survey tool

Data & information on HAI website: www.haiweb.org/medicineprices

Standardised MethodologyStandardised Methodology

Systematic sampling: min 6 regions, 5 pharmacies Systematic sampling: min 6 regions, 5 pharmacies per sector per regionper sector per region

Public sector facilities, private retail pharmacies and Public sector facilities, private retail pharmacies and ‘other’ sectors (e.g. dispensing doctors)‘other’ sectors (e.g. dispensing doctors)

Prices of 30 pre-selected commonly used medicines Prices of 30 pre-selected commonly used medicines – 14 global + 16 regional– 14 global + 16 regional

Predetermined dose form & strength, & Predetermined dose form & strength, & recommended pack sizerecommended pack size

Supplementary medicines highly encouraged, Supplementary medicines highly encouraged, adapted to local needsadapted to local needs

Prices of originator brand and lowest price generic Prices of originator brand and lowest price generic are collected, referenced to international are collected, referenced to international benchmark (MSH)benchmark (MSH)

AvailabilityAvailability of medicine on day of survey of medicine on day of survey Affordability - number of days wages for lowest paid Affordability - number of days wages for lowest paid

unskilled government worker to purchase treatmentunskilled government worker to purchase treatment All components of price from manufacturer to All components of price from manufacturer to

retailer identifiedretailer identified

Surveys to dateSurveys to date

Middle EastMiddle East: Lebanon, Jordan, Kuwait, Syria, Sudan, UAE, : Lebanon, Jordan, Kuwait, Syria, Sudan, UAE, YemenYemen

Francophone AfricaFrancophone Africa: : Tunisia, Morocco, Algeria, Mali, Chad, Tunisia, Morocco, Algeria, Mali, Chad, Senegal, Niger, CameroonSenegal, Niger, Cameroon

Anglophone AfricaAnglophone Africa: Uganda, South Africa, Tanzania, Kenya, : Uganda, South Africa, Tanzania, Kenya, Ethiopia, Zimbabwe, Nigeria, GhanaEthiopia, Zimbabwe, Nigeria, Ghana

Asia/PacificAsia/Pacific: Mongolia, China: Shandong & Shanghai, : Mongolia, China: Shandong & Shanghai, Philippines, Malaysia, Pakistan, Fiji, Indonesia, Vietnam, Philippines, Malaysia, Pakistan, Fiji, Indonesia, Vietnam, Cook IslandsCook Islands

IndiaIndia:: West Bengal, Haryana, Karnataka, West Bengal, Haryana, Karnataka, Maharashtra (2), Maharashtra (2), Chennai, RajasthanChennai, Rajasthan

Central AsiaCentral Asia:: Kazakhstan, Tajikistan, Kazakhstan, Tajikistan, Kyrgyzstan, Uzbekistan Kyrgyzstan, Uzbekistan EuropeEurope: : Bosnia Herzegovina, KosovoBosnia Herzegovina, KosovoSouth AmericaSouth America: Peru: Peru

In progress/planned: Oman, Brazil, Zambia, Mauritius, Libya, In progress/planned: Oman, Brazil, Zambia, Mauritius, Libya, Iran, UkraineIran, Ukraine

Medicine price, availability and Medicine price, availability and affordability survey in affordability survey in

Kyrgyzstan, 2005Kyrgyzstan, 2005

Survey Manager: Survey Manager: Saliya Saliya KarymbaevaKarymbaeva

Drug Information CentreDrug Information CentreBishkekBishkek

MethodologyMethodology

• Number of medicines surveyed: 28

Core 19 Supplementary 9

• Type: originator brand, most sold generic, lowest priced generic

• Number of regions surveyed: 6

Bishkek and 5 oblasts:Chui, Naryn, Osh, Jalal-Abad, and Batken

• Total number of facilities sampled:SectorsSectors NumberNumber

Public sector(procurement prices)

Tender prices from

2 wholesalers

Private retail pharmacies(patient prices)

30(5 per region)

Medicines surveyedMedicines surveyedCore listCore listaciclovir 200mg tab, amitriptyline 25mg tab, aciclovir 200mg tab, amitriptyline 25mg tab, amoxicillin 250mg tab,, atenolol 50mg tab, amoxicillin 250mg tab,, atenolol 50mg tab, beclometasone 50mcg/dose inhaler, captopril 25mg beclometasone 50mcg/dose inhaler, captopril 25mg tab, carbamazepine 200mg tab, ceftriaxone 1g inj, tab, carbamazepine 200mg tab, ceftriaxone 1g inj, ciprofloxacin 500mg tab, co-trimoxazole paed susp, ciprofloxacin 500mg tab, co-trimoxazole paed susp, tab, diclofenac 25mg tab, fluoxetine 25mg tab, tab, diclofenac 25mg tab, fluoxetine 25mg tab, glibenclamide 5mg tab, hydrochlorothiazide 25mg glibenclamide 5mg tab, hydrochlorothiazide 25mg tab, nifedipine retard 20mg tab, omeprazole 20mg tab, nifedipine retard 20mg tab, omeprazole 20mg tab, phenytoin 100mg tab, ranitidine 150mg tab, tab, phenytoin 100mg tab, ranitidine 150mg tab, salbutamol 0.1mg/dose inhaler salbutamol 0.1mg/dose inhaler Supplementary listSupplementary listampicillin 250mg tab, clonazepam 2mg tab, ampicillin 250mg tab, clonazepam 2mg tab, diazepam 10mg, fluconazole 150mg tab, furosemide diazepam 10mg, fluconazole 150mg tab, furosemide 40mg tab, gentamicin 40mg/ml inj, mebendazole 40mg tab, gentamicin 40mg/ml inj, mebendazole 100mg tab, metronidazole 250mg tab, verapamil 100mg tab, metronidazole 250mg tab, verapamil 40mg tab40mg tab

Availability Availability

Private pharmaciesPrivate pharmacies

Originator BrandsOriginator Brands GenericsGenerics

Median availabilityMedian availability 0%0% 80%80%

AvailabilityAvailability MedicineMedicine

No pharmacies beclometasone inhaler

1 – 24 % ceftriaxone inj, clonazepam, fluoxetine, mebendazole, phenytoin

25-49 % ciprofloxacin, fluconazole

50 – 79% aciclovir, amitriptyline, carbamazepine, cotrimoxazole susp, diazepam

80% and over amoxicillin, ampicillin, atenolol, captopril, diclofenac, furosemide, gentamicin inj., glibenclamide, hydrochlorothiazide, metronidazole, nifedipine retard, omeprazole, ranitidine, salbutamol inhaler, verapamil

Median % availability of generics Median % availability of generics in private pharmacies per regionin private pharmacies per region

100 100

80

60

80

60

0

20

40

60

80

100

120

Bishkek Chui Naryn Jalalabad Osh Batken

Lowest price generic equivalent

Examples of % availability of Examples of % availability of generics in private pharmacies generics in private pharmacies

across regionsacross regions

0

20

40

60

80

100

Bishkek Chui Naryn Jalalabad Osh Batken

Co-trimoxazole

Glibenclamide

Hydrochlorothiazide

Median price ratioMedian price ratio

- - MPR = ratio of median unit price across facilities MPR = ratio of median unit price across facilities

surveyed by international reference pricesurveyed by international reference price- MPR only calculated if medicine found in at MPR only calculated if medicine found in at

least 4 facilitiesleast 4 facilities

International reference priceInternational reference price

- external standard for evaluation of local pricesexternal standard for evaluation of local prices- From: Management Sciences for Health From: Management Sciences for Health

‘International Drug Price Indicator Guide'‘International Drug Price Indicator Guide'- web-based, prices relatively stable, updated web-based, prices relatively stable, updated

annuallyannually

Government procurement Government procurement pricesprices

Number of medicines in the

2 tenders (n=28)

Median MPR

25%ile MPR

75%ile MPR

Originator brand 1 59.47

Lowest price generic equivalent

17 1.29 1.03 2.04

Examples of high govt. procurement Examples of high govt. procurement pricesprices

Medicine (generics) Median Price Ratio

Amitriptyline 25mg tab 3.26

Diclofenac 25mg tab 2.71

Hydrochlorothiazide 25mg tab 4.88

Metronidazole 250mg tab 2.04

Carbamazepine 200mg tab 2.06

Patient prices in private retail Patient prices in private retail pharmaciespharmacies

Number of medicines found in 4+ pharm.

MedianMPR

25%ile 75%ile

Originator brand 7 5.42 5.08 29.95

Lowest priced generic equivalent

23 2.56 1.63 4.29

Paired analysis (5 meds) : Originator Brand Med MPR 5.42Lowest Priced Generic Med MPR 1.52

Originator Brands over 3x the price of cheapest generic equivalents

Examples of patient prices in private Examples of patient prices in private retail pharmaciesretail pharmacies

0 5 10 15 20 25 30 35 40 45 50

Co-trimoxazole suspension

Fluconazole

Mebendazole

Metronidazole

Verapamil

Hydrochlorothiazide

Ciprofloxacin

Amoxicillin

Amitriptyline

median price ratio

Originator brand

Lowest priced generic

99

Patient prices, private sector, by Patient prices, private sector, by regionregion

4,9 4,51,8

5.1 2,7 2,0

52.4

5.72,5

91,7

9,9

2,9

11.6

2.9 4,1 2,6

0

10

20

30

40

50

60

70

80

90

100

Bishkek Chui Naryn Jalalabad Osh Batken

Originator brand

Most sold genericequivalent

Lowest price generic equivalent

Patient price, captopril 25mg tab, Patient price, captopril 25mg tab, private sector by regionprivate sector by region

Affordability of treatments for lowest paid unskilled Affordability of treatments for lowest paid unskilled gov’t worker purchasing medicines in the private gov’t worker purchasing medicines in the private

sectorsectorDaily wage = 20 som Days’ wagesDays’ wages

Hypertension:Hydrochlorothiazide 25 mg x 1 for 30 days

Originator brand

Lowest price generic 1.91.9

Hypertension:Captopril 25mg x 2 for

30days

Originator brand 17.617.6

Lowest price generic 4.54.5

Diabetes:Glibenclamide 5mgx 2 for 30 days

Originator brand

Lowest price generic 2.12.1

Asthma:Salbutamol inhaher

Originator brand 7.37.3

Lowest price generic 4.54.5

Pneumonia:Amoxicillin 250 mg x 3 for 7 days

Originator brand

Lowest price generic 2.62.6

Ulcer:Ranitidine 150mg x 1 for 30 days

Originator brand

Lowest price generic 5.15.1

Ulcer:Omeprazole 20 mg x 2

for 30 days

Originator brand

Lowest price generic 11.511.5

AAffordability of ffordability of lowest priced generic lowest priced generic amoxicillin to treat amoxicillin to treat respiratory infectionrespiratory infection, ,

private sectorprivate sector

2.4

1.9

2.6

2.9

2.6

2.5

0 0.5 1 1.5 2 2.5 3 3.5

Bishkek

Chui

Naryn

Jalalabad

Osh

Batken

Days' wages

Price components: hypothetical, imported, Price components: hypothetical, imported, private sectorprivate sector

Component Originator brand Generic equivalent

Charge Cumulative % mark-up

Charge Cumulative %

mark-up

Import price 0% 0%

Import duty 0.15% 0.15% 0.15% 0.15%

Wholesale mark-up (average)

20%20.18%

30%30.20%

Retail mark-up (average) 10% 32.20% 20% 56.23%

Retail sales tax 4% 37.49% 4% 62.48%

Percentage contribution of components to Percentage contribution of components to final patient price, generic atenolol 50mg final patient price, generic atenolol 50mg

tabs, importedtabs, imported

62%

0%

18%

16%

4%

Stage 1:MSP + FreightStage 2:Landed priceStage 3 :WholesaleStage 4:RetailStage 5:Dispensed medicine price

Percentage contribution of components to final patient Percentage contribution of components to final patient price, originator brand captopril 25mg tabs, importedprice, originator brand captopril 25mg tabs, imported

69%

0%

14%

13%

4%

Stage 1:MSP + FreightStage 2:Landed priceStage 3 :WholesaleStage 4:RetailStage 5:Dispensed medicine price

Major FindingsMajor Findings Procurement prices not freely accessible on a Procurement prices not freely accessible on a

website, overall prices were generally reasonable website, overall prices were generally reasonable although they were high for some medicinesalthough they were high for some medicines

Overall patient prices in the private sector were Overall patient prices in the private sector were reasonable for lowest priced generics compared to reasonable for lowest priced generics compared to international reference prices but some individual international reference prices but some individual prices were very highprices were very high

Originator brands not common: 3-4x more Originator brands not common: 3-4x more expensive than lowest priced genericsexpensive than lowest priced generics

Availability of generics in private sector reasonableAvailability of generics in private sector reasonable Medicines are not affordable (even when cheapest Medicines are not affordable (even when cheapest

generics purchased)generics purchased) Manufacturer’s selling price was major component Manufacturer’s selling price was major component

cost; sales tax and import tax apply to medicines cost; sales tax and import tax apply to medicines

Recommendations in the reportRecommendations in the report

Investigation needed into causes of high pricesInvestigation needed into causes of high prices Extended study needed on regional variations in prices and Extended study needed on regional variations in prices and

availabilityavailability In-depth component study needed with view to regulating In-depth component study needed with view to regulating

mark-upsmark-ups Abolish taxes on essential medicinesAbolish taxes on essential medicines Pro-generics policies and programmes including education for Pro-generics policies and programmes including education for

physicians, pharamcists and the public about economic physicians, pharamcists and the public about economic benefits of genericsbenefits of generics

Regularly monitor prices, availability and affordability and Regularly monitor prices, availability and affordability and publish results (especially to patients)publish results (especially to patients)

Establish public outlets with lower prices in rural and remote Establish public outlets with lower prices in rural and remote regionsregions

Centralise public purchasing (including Health Insurance Centralise public purchasing (including Health Insurance Fund)Fund)