CPTPP could lead to ‘soaring’ health costs

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will cost Thailand considerably more in medicines and make the country further reliant on imported drugs while leaving state-owned drugmakers in a difficult position, according to a study by Chulalongkorn University.

Entitled “CPTPP Impact on Access to Medicines”, the study by the Faculty of Pharmaceutical Sciences to provide analyses on the impact of the CPTPP on healthcare and pharmaceutical products has been submitted to the sub-committee formed by the House to study the pros and cons of joining the CPTPP.

The study looked at the 30-year impacts of the CPTPP’s patent linkage and government procurement for medicines used in state hospitals, according to Asst Prof Rungpetch Sakulbumrungsil, dean of the faculty.

The study also examined two issues. The first being patent linkage — the relationship between the market approval of a generic drug and the patent status of its branded equivalent — and the second being the impact on state hospital procurement of medicines.

The study noted that the Government Pharmaceutical Organisation (GPO) has produced many generic drugs and that helped to provide affordable medicines to patients since it launched compulsory licencing (CL) in 2017, which allows Thailand to use cheaper, generic drugs instead of importing expensive versions from multinational manufacturers.

Yet Asst Prof Rungpetch warned that patent linkage under the CPTPP will require two years or more before the GPO can apply CL to drugs and also open the doors to legal disputes.

“Although the CPTPP’s patent linkage will allow several drug makers to apply for the registration of their generic versions of the same drug, the real concern is that the process will take longer than usual,” she said.

In terms of state hospitals medicine procurement, Asst Prof Rungpetch warned that the CPTPP would lead to a steep rise in the cost of both medicines and treatment.

That is because the CPTPP will require Thailand to cancel a policy that requires state hospitals to purchase cheaper generic drugs from the GPO unless they are out of stock.

“But when these state-run hospitals are allowed to freely purchase medicines from any private suppliers, the costs of medicinal treatment may rise, she warned.

Last year, the country spent 196.8 billion baht on medicines, of which 71% were imported products. Of the remaining 29%, most were produced by local manufacturers with 10% being GPO-made generic drugs at a value of 6.9 billion baht.

“Under the CPTPP, the country’s drug costs will rise by 107.9 billion baht over the next 30 years, while the percentage of imported drugs will rise to 85% compared with only 76% without the CPTPP,” she said.

The CPTPP is a trade agreement involving a bloc of 11 Pacific Rim nations, but excluding the United States.