Reduce Price Of Medicines To Save Lives


Geha Nath Khanal,

Resham Bahadur Khatri

Addressing the World Health Assembly 2017 in Geneva, Switzerland last month, the outgoing Director-General, Dr Margaret Chan, in her remark said that the affordability of medicines remains the major challenge to the global health. This bitter reality remains major barrier in accessing the health care, affecting all population. For instance, unexpected high prices of prescribed medicines have become a major concern for the people who are under medication for chronic diseases. As a result, many people go untreated or cannot complete the full course of the treatment and lose their lives.

Great effort

Nepal has also shifted its disease burden from communicable and infectious diseases to non-communicable diseases (NCDs) such as cancer, kidney, heart and liver diseases are emerging. However, poor capacity of in-country production by pharma companies and higher dependency on imports, poor Nepalis are becoming victims. It is estimated that 70% of drugs are imported from other countries, especially from India. Considering this fact, former Health Minister Gagan Thapa requested the World Health Organisation (WHO) member countries to reduce the price of medicine which was a great effort from developing countries.

Nepal’s tertiary health care services are highly centralised. Most of the specialised hospitals and specialists are practising in Kathmandu. Delay in reaching hospitals is compounded by poor public transportation system and difficult geographic terrain. Long waiting time and overcrowding in government hospitals and unaffordable services in private hospitals are also being observed. These reasons, including expensive medicines increase the out of pocket expenditure and lose the productivity due to illness. The high cost of medicine sometimes forces the people for skipping the dose and duration of treatment resulting non-compliance of required medications.

Annually, the price of drugs and medical products is increasing worldwide. For instance, the annual growth in drug price was observed to be 6.5%   in India, and more than 10% in the US. Since the price of drugs is already high in the international market; this may lead to catastrophic situation for the patients in developing countries due to their poor purchasing power.

Because of life-style and other social determinants of health, the so-called diseases of rich, such as NCDs, poor people are also affecting. The WHO estimates that NCDs will constitute 80% of global burden of diseases and 70% of the NCDs related deaths will occur in developing countries by 2020.  These chronic diseases affect not only the quality of life but also act as the major drivers of high health care expenditure of the family. For instance, the cost of drugs/medicines constitutes up to 56%  of total health care cost and two-thirds of out-of pocket expenditure in Nepal.

Nepal has strong public health care system and structure at the grass root level; basic health care services are now accessible in the remote areas. It was possible after implementation of national health policy 1991. But apparently, it seems that specialised services of big cities are for rich people of accessible areas.  

The constitution of Nepal (2015) has incorporated health as a fundamental right and mentions  that “every citizen shall have the right to seek basic healthcareservices, and no citizen shall be deprivedof emergency healthcare” which assures the financial protection in health care.  The areas of population to be covered, quality of services to be provided and proportion of health care expenditure to be borne by government form the concept of Universal Health Coverage (UHC). This equitable access to quality health services by increasing investment in health has clearly been defined in the Constitution. However, the cost of medicine remains the major obstacle in UHC since it hinders in financial protection unless the government adopts effective interventions immediately.

Given the fact, to reduce the prices of medicines and make them available at the affordable cost, following measures can be taken. Firstly, the medical practitioners should strictly follow the ethical conduct of prescribing drugs in generic names. This ethical conduct might be opposed by the pharmaceutical companies and their agents, sometimes by the medical practitioners. Professional bodies, for instance, Nepal Medical Association or Nepal Pharmacy Association can suggest their members to abide by these professional ethics. The drugs will not only be cheaper but also have uniformity and standardisation drugs in the market. Secondly, establishment of own hospital pharmacies should be made compulsory in all hospitals. Recently government has initiated this provision, and many hospitals have set up their pharmacies. The recent study conducted in Chitwan  has shown that the drug price fell up to 85% after running of their pharmacies.  Also, the government should set the standard for drug list and the minimal stock for these pharmacies.

A recent report of the Ministry of Health had revealed that Nepalese have to pay 400% to 2200% more than the actual price of the medicines. The government has proposed to purchase the medicines itself and provide them to the public hospitals’ pharmacies and has estimated that this approach would save the treatment cost by 50%. It has been identified for the first time which can reduce the prices of medicines by the intervening role of multiple suppliers and getting margins at a different stage. There has been a strong opposition  from the drugs suppliers and producers; however, the government should take actions to implement this policy at any cost.

Furthermore, the government should fix the price of essential drugs and set the ceiling price. The ceiling price would reduce the price of drugs, and the chronic patients would get the maximum benefit. The implementation of ceiling price had reduced the price of the drug by 56% in India.

The government has decided to revitalise the public pharmaceutical companies. Another way will be to establish atbleast one pharma companies such as Singh Durbar Vaidhya Khana and Nepal Aushadi Limited and their branch in each province. It will not only assure the timely supply and availability at services outlets but will also provide the opportunity for the market of traditional herbs which have not been utilised or being sold at a very low price.

Long-term solution

Having said this, the long-term solution for the access to and use of tertiary care health services or medicines is the implementation of national health insurance programme. The government of Nepal has proposed to implement it throughout the country within three years. However, decentralisation of tertiary care services from capital to provincial level and assurance of low-cost drugs throughout the year would help to scale up and sustain the success of health insurance initiative.

(Khanal works in Public Health sector in Nepal and Khatri is a Ph. D. (Health System and Policy) student at the University of Queensland, Australia.)

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