Com­plex Task in Hand

BioSpectrum (India) - - BIO EDIT - Milind Kokje Chief Edi­tor milind.kokje@mmac­tiv.com

Re­cent rev­e­la­tions in an of­fice mem­o­ran­dum of the Na­tional Phar­ma­ceu­ti­cal Pric­ing Au­thor­ity (NPPA) suf­fi­ciently makes it clear that the gov­ern­ment will have to work on two fronts if it wants to pro­vide re­lief to the pa­tients from the high drug and med­i­cal equip­ment prices. Con­trol­ling the drug prices is the first front on which the gov­ern­ment has al­ready ini­ti­ated few steps by reg­u­lat­ing prices of some drugs. But pre­vent­ing hos­pi­tals from earn­ing huge prof­its from sale of the drugs and pass on the re­lief of con­trolled drug prices to the pa­tients is the sec­ond and the most com­plex front on which the gov­ern­ment will have to work.

The is­sue of hos­pi­tals over­charg­ing the pa­tients for the medicines has come to fore­front when pa­tients com­plained to NPPA about the over­pric­ing. NPPA did anal­y­sis of the bills of four hos­pi­tals and found out how the hos­pi­tals are play­ing tricks in not pass­ing on the ben­e­fit to the pa­tients de­spite the gov­ern­ment cap­ping the prices. NPPA in its of­fice mem­o­ran­dum has ex­plained how the hos­pi­tals are ex­ploit­ing pa­tients by var­i­ous meth­ods with very high drug and con­sum­able prices and earn­ing huge prof­its, which runs up to even 2000 per cent in some cases.

This is im­por­tant be­cause ac­cess to af­ford­able medicines and treat­ment is not merely a mar­ket is­sue but an im­por­tant so­cial is­sue. It is more so in a coun­try like In­dia which has a large num­ber of poor pop­u­la­tion. The is­sue is so sen­si­tive that the Doha Dec­la­ra­tion also recog­nises con­cerns of the ef­fect of in­tel­lec­tual prop­erty on prices and af­firms that “the TRIPS Agree­ment does not and should not pre­vent Mem­bers from tak­ing mea­sures to pro­tect pub­lic health”. The dec­la­ra­tion reaf­firms the right of the World Trade Or­gan­i­sa­tion (WTO) mem­bers to use safe­guard pro­vi­sions in Trade-Re­lated As­pects of In­tel­lec­tual Prop­erty Rights (TRIPS) agree­ment to en­hance ac­cess to medicines for poor coun­tries.

Ac­knowl­edg­ing that the pric­ing and ac­ces­si­bil­ity of patent-pro­tected drugs in low and mid­dle in­come coun­tries is a con­tentious is­sue, Ernst Berndt, Man­age­ment Pro­fes­sor of MIT and Iain Cock­burn, Pro­fes­sor of Eco­nom­ics at Bos­ton, high­light the im­por­tance of IPR. In an ar­ti­cle in Health Af­fairs based on their study from 2000 to 2009 of 184 US Food and Drug Ad­min­is­tra­tion (FDA) ap­proved drugs sold in In­dia, 50 per cent of them “went on sale in In­dia only af­ter lags of more than five years from their first world­wide in­tro­duc­tion.” Over 50 per cent of the drugs that be­came newly avail­able in the same pe­riod were pro­duced and sold by mul­ti­ple man­u­fac­tur­ers in­di­cat­ing weak patent pro­tec­tion and sharp com­pe­ti­tion, which are dis­in­cen­tives. They con­cluded that mod­est patent and reg­u­la­tory re­forms would make the faster avail­abil­ity of new drugs with lim­ited im­pact on prices.

While analysing bills of some hos­pi­tals from Delhi, NPPA found that out of the to­tal bill amount only 4 per cent is for sched­ule for­mu­la­tions while over 25 per cent is for non-sched­ule for­mu­la­tions and over 10 per cent is of non-sched­uled de­vices and con­sum­ables. Only 4 per cent of the to­tal bill amount has a price con­trol. In case of other 35 per cent non-sched­ule for­mu­la­tions, de­vices and con­sum­ables there is no con­trol over prices. NPPA has con­cluded that doc­tors pre­fer pre­scrib­ing non-sched­uled medicines in­stead of sched­uled medicines to earn higher mar­gins. This is di­lut­ing the pur­pose of putting the drugs un­der the list of price con­trol, NPPA has ob­served.

Cur­rently there are 871 drugs un­der the price con­trol drug list (Na­tional List of Es­sen­tial Medicines - NLEM). The growth rate of non-NLEM drugs is dou­ble than NLEM drugs in 2017 clearly in­di­cat­ing the trend of mi­gra­tion from sched­uled to non-sched­uled cat­e­gory. While con­trol­ling the prices of es­sen­tial drugs at one level, the gov­ern­ment will have to find ways to stop the mi­gra­tion from sched­uled to non-sched­uled prac­ti­cally mak­ing it in­ef­fec­tive and con­trol­ling all charges for con­sum­ables etc.

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