‘Be sole negotiator for whole nation’
Government urged to initiate bulk purchasing and control drug prices
KUALA LUMPUR: Not long after claims of politicians, high-ranking officials and international pharmaceutical companies monopolising the prices of medical supplies, there are separate calls for the Government to initiate bulk purchase and price control on the supplies.
Malaysian Pharmaceutical Society president Amrahi Buang said that within the Government, the three ministries involved in procuring medicines – Health, Education and Defence – negotiate separately while it is “free for all” in the private sector.
“With the various parties working in silos, it would be difficult for patients to get good drug prices.
“The Government should play the role of negotiating for the whole country – for the public and the private sector. If that is done, then they are in the position to control the price,” he said.
Details of high-ranking officials, politicians and their relatives allegedly involved in controlling billions of ringgit worth of medical supply to the Government emerged last Wednesday.
In a 12-page document emailed to Health Minister Dr Dzulkefly Ahmad and forwarded to a few parties, including The Star, it was revealed that the bid-rigging of the open tender process enabled the monopoly of medical supplies to the ministry.
From 2013 to 2016, the total medicine tender awards which interna- tional pharmaceutical companies could participate were controlled by six tendering agents.
Of the total contract value of RM3.7bil, the top six were awarded RM3.4bil or 90.93%, while the top three tendering agents were awarded RM2.8bil or 75.9%
Amrahi said Malaysia should adopt a system similar to Australia’s, which has an integrated system and the Government negotiates directly with the manufacturers, especially for patent drugs.
“Even Turkey has started negotiating prices at country level,” he said, adding that the Government also needs to put in a mechanism to control the prices of medicines, with a recommended selling price to consumers.
A study by Zaheer-Ud-Din Babar and Mohamed Izham Mohamed Ibrahim in 2005 revealed that drug prices increased 10.42% within two years after the privatisation of public procurement of essential medicines in 1994.
The study showed that the prices spiked from 2001 to 2003 compared to the four preceding years, registering an average increase of 64%.
After analysing the prices of 564 drugs in the pre- and post-privatisation periods, the study found privatisation of drug distribution to be having a major effect on drug prices in the mid-1990s and the beginning of the 2000s.
Third World Network adviser Dr Lim Mah Hui said drug prices in Malaysia was high although there was no import duties imposed on them.
Besides the lack of a centralising purchasing system, the patent system and drugs going through many levels before reaching patients have added to the high cost of medicine, he said.
Dr Lim said the patented hepatitis drug Sofosbuvir, for instance, cost RM350,000 for a patient to be treated but the generic drug cost only US$300 (RM1,196).
“Originator drug companies will find ways to extend the patent for more than 20 years and the Government must stop this,” he said.
While the Government should initiate centralised purchasing and regulate the price of drugs like what the advanced countries were doing, there was still a need for a study to be done on the drug procurement system, Dr Lim said.