The report Delivering on the Global Partnerships for Achieving the Millennium Development Goals was launched on September 4th by the UN Secretary-General Ban Ki-Moon. Prepared by the MDG Gap Task Force, it describes progress towards achieving MDG 8 (develop a global partnership for development), including Target 8.E: In cooperation with pharmaceutical companies, provide access to affordable essential drugs in developing countries. Target 8.E was measured using nine indicators. A key source of data used to report on these indicators was surveys of medicine prices, availability, affordability and price components undertaken using the WHO/HAI methodology. Results from 30 countries show that, on average, availability of medicines is far from optimal: 34.9% in the public sector and 63.2% in the private sector. The retail price of lowest priced generic medicines is over 6 times international reference prices (IRPs) in the private sector, and about 2.5 times IRPs in public sectors where patients purchase medicines. Prices of originator brand medicines were considerably higher. Thus, access to essential medicines is being hindered by low availability, particularly in the public sector, as well as high prices. Treatments are simply beyond the reach of millions of people across the world. For example, in the private sector in Pakistan the lowest paid unskilled government worker has to work over 6 days to buy a month's supply of ranitidine to treat an ulcer (purchasing the lowest priced generic). In Indonesia, it takes 4 days wages to buy just one salbutamol inhaler to treat asthma. Countries must act to reduce prices and improve the availability of essential medicines. Low government procurement prices must be passed on to patients, taxes and duties on essential medicines must be abolished, mark-ups must be reduced and made transparent, there must be adequate and sustainable public sector financing for medicines, and increased use of low cost quality generic medicines.

Read more: HAI press release Report of the MDG Gap Task Force: English, French, Spanish Section of report on Access to Affordable Essential Medicines UN press release UN fact sheet ‘Where are the gaps’: English, French UN MDG Gap Task Force website for further information WHO website – price and availability data used in the report HAI fact sheet on WHO/HAI Project on Medicine Prices and Availability Medicine price, availability and affordability data, for all surveys, can be accessed by clicking on 'Database' above

Project Co-ordinators Alexandra Cameron (WHO) & Margaret Ewen (HAI) reviewing the manual

During the World Health Assembly in May 2008, Health Action International and the World Health Organization launched the second edition of their manual entitled Measuring medicine prices, availability, affordability and price components. Since launching the first edition in 2003, over 50 surveys have been conducted generating reliable information on the prices, availability and affordability of medicines in many countries. A second edition of the manual has been published incorporating the wealth of practical experience gained by national teams conducting surveys in countries around the world. The CD ROM accompanying the manual includes an updated Excel workbook, and new survey tools and background material

Ordering the manual?

To order a copy of the manual and CD ROM, email your request to the WHO PSM documentation centre (edmdoccentre@who.int). A copy will be sent free-of-charge. You can also download the manual, workbook and all other material from this website.

This second issue of WHO/HAI's bulletin on medicine pricing issues contains news from a number of countries including Jordan's call to abolish taxes on medicnes, key findings from a study of the anti-malarials market in Uganda, and opposition to the introduction of pro-generics policies in Sri Lanka. The lead article outlines the development, by WHO and HAI, of guidelines on policy options to lower prices and improve access to treatment.
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Approximately 90 participants from the Ministry of Health and other government agencies, pharmacist and physician associations, NGOs, academia, pharmaceutical industry and others met at the Dead Sea, 4-5 December 2007, to discuss ways to make medicines more available and affordable in Jordan. The workshop was held under the patronage of his Excellency, Minister of Health Dr. Salah Mawajdeh. It was co-hosted by the Jordan Food & Drug Administration (JFDA) and Health Action International.

The objectives of the workshop were to disseminate the findings and recommendations of the Jordan price survey, identify policies and programmes to improve, in particular, the availability of medicines in the public sector and the affordability of medicines in the private sector, and to establish a task force to take the work forward.

In addition to presenting the survey results, plenary presentations and panel discussions covered various policy and pricing issues in Jordan and the Eastern Mediterranean region. In smaller groups, participants then discussed strategies to improve government procurement of medicines and their availability in public sector facilities, price-setting in the private sector, improving treatment affordability through pro-generics policies and programmes, and the impact of intellectual property rights and trade agreements on access to affordable medicines in the country. Group recommendations for action were then presented in plenary.

One of the many recommendations of the workshop was to remove customs duty (up to 5% on most imported medicines) and sales tax (4% on all medicines). On 3 January 2008, the Director General of the JFDA Dr Mohamed Rawashdeh announced in a major Jordanian daily newspaper that exempting customs and sales taxes on medicines will not affect the Jordanian economy but will help improve the affordability of treatments. Subsequently, the Pharmaceutical Association and Pharmaceutical Manufacturers Association supported the JFDA’s call for taxes to be removed on medicines. The President of the Parliament’s Health and Environmental Committee, Mr. Khalil Al Ruqad, responded positively, saying the Committee will meet to discuss abolishing these taxes in order to lower medicine prices and improve affordability. Most press articles can only be viewed in Arabic.

The results of a survey undertaken in the United Arab Emirates in late 2006 are now available in the database (the survey report is expected soon). The survey was conducted by Dr Nadia Abdul-Malek Younes, head of the private pharmacy sector of the Federal Ministry of Health. Twenty-five medicines (originator brand and lowest priced generic equivalent of each) were surveyed in 23 private retail pharmacies and 18 public sector outlets. Public sector procurement data was based on GCC procurement system purchases. Median supplier prices in the 2005 Management Sciences for Health International Drug Price Indicator Guide were generally used as reference prices.

Key findings included:

• Expensive originator brands were being purchased by the government (about 5 times the reference prices) as well as much cheaper generics (whose prices were similar to the reference prices)
• Poor availability in the public sector where medicines are free (61% for generics, 17% for originator brands)
• Availablity in the private sector was excellent for originator brands (100%) but not cheaper generics (74%)
• Extremely high patient prices in the private pharmacies (originator brands were about 24 times the reference prices; lowest priced generics were about 14 times the reference prices)
• Lowest priced generics were generally affordable when purchased by the lowest paid unskilled government worker in the private sector
• but originator brands were far less affordable e.g. a person with arthritis would have to work 2.5 days to buy a month's supply of diclofenac 25mg tabs originator brand (Voltaren) but less than a day for lowest priced generic equivalents. Price components were not measured but wholesale and retail margins were each considered to be about 20%.

Following confirmation that some medicine prices were very high in Shangdong Province (China), the survey team at the Center for Health Management and Policy of Shangdong University conducted a survey on medicines knowledge of urban residents in Jinan. Those surveyed generally preferred buying medicines at private pharmacies because they were conveniently located and prices were often cheaper than in public health centres. Click here to read more

In response to survey findings, a number of countries are now regularly monitoring medicine prices, availability and affordability. Three of the countries were pilots for WHO and HAI. In February 2008, WHO and HAI are convening a meeting with all countries currently monitoring medicine prices and availability, to share experiences and develop a set of minimum standards for this work. A number of countries keen to establish monitoring systems will also participate in the meeting.

Medicine price, availability and affordability issues were discussed by delegates at the recent meeting of the Regional Committee for WHO’s Eastern Mediterranean Region, held in Cairo 20-23 October 2007.

Dr Zafar Mirza, regional advisor on essential medicines and pharmaceutical policies, presented the results from 11 surveys undertaken in the region using the WHO/HAI medicine price measurement methodology. Key findings included:

• Substantial differences in government procurement prices across countries
• Government purchasing of expensive originator brands, as well as cheaper generics, in all but 3 countries. On average, originator brands were about 3 times more expensive than generics. Prices of generics were often high.
• Availability in public sector facilities was very poor e.g. 16 of the 35 surveyed medicines were not found in any outlet surveyed in Yemen, 23 of 29 medicines were not found in 50% of the outlets in Pakistan
• Excessive prices in the private sector for originator brands and lowest priced generics e.g. Sudanese patients were paying 18 times international reference prices for originator brands. Lowest priced generics were over 5 times the reference prices in most countries
• Most treatments purchased in the private sector were unaffordable for the poor
• Some countries were applying taxes to essential medicines

A lengthy discussion followed with comments from Ministers, or their representatives, from 16 countries. They acknowledged the many problems related to medicine prices in both public and private sectors. Many also noted that the TRIPS Agreement had contributed to rising prices and diminished access to medicines, especially in developing countries. Various policy and programme options were mentioned including the increased use of quality generics to improve affordability, regressive mark-ups to encourage the dispensing of lower priced generics, pooled procurement, plus greater transparency and the sharing of price information. WHO Regional Director, Dr Gezairy, said the issue of medicine pricing was sensitive and of the utmost importance, and offered a number of options for countries to consider to reduce prices. HAI urged countries to develop, implement and enforce sound evidence-based policies and programmes, and monitor their impact, to ensure medicines are affordable and available to all.

A resolution was passed that featured the establishment of a web-based medicines prices hub in the region to share information on medicine prices and pricing structures, as well as best practices in medicine management. This innovative approach is welcomed as it will improve price transparency and empower governments to negotiate for more favourable prices. The resolution also urged governments to strengthen pricing policies (including public procurement of generics, and enhanced competition amongst suppliers) and rationalize supply chain costs in the private sector. WHO EMRO resolved to support Members States in this work including the development of guidelines on pricing policies and sharing information on best practices from other regions.

In July 2006, a medicine price and availability survey was undertaken in Yemen by Dr Yaseen Ahmed Al-qubati and Eng. Abdul-Karim Shaher Ahmed from the Supreme Board for Drugs and Medical Appliances. Data was collected for 35 essential medicines (originator brand and lowest priced generic equivalent) in a total of 20 public sector facilities and 20 private pharmacies in Sana’s City and the main cities in 3 governates (Aden, Hodiedah and Taiz).

• public sector availability was extremely poor (median 5%). Sixteen of the 35 medicines (45%) were not found in any of the facilities including metformin, phenytoin, atenolol, salbutamol inhaler, nevirapine, acyclovir, levothyroxine and beclometasone inhaler.
• availability was better in private retail pharmacies – median 90% for generics and 50% for originator brands.
• Overall, in private pharmacies, originator brands were 5 times more expensive than lowest priced generics. Originator brand ciprofloxacin (Ciprobay) was a massive 129 times the international reference price, while the lowest priced generic equivalent was much cheaper (about 5 times the reference price). The originator brand of metronidazole tabs (Flagyl) was 35 times the reference price. The lowest priced generic equivalent was less, but still high cost at 9 times the reference price.
• In the private sector many standard treatments were simply not affordable. The lowest paid unskilled government worker would have to work nearly 2 days to pay a months treatment with amitriptyline or 1.5 days for metformin (lowest priced generics).

• Updating the EDL and ensuring all essential medicines are available in public facilities.
• Rationalising medicine expenditure, adopting a suitable pricing system and seeking alternative funding for medicines
• Reviewing manufacturer’s prices and introduce regressive mark-ups in the supply chain
• Encouraging the prescribing and dispensing of low-cost generics to improve treatment affordability, especially for the poor.

Click here to read the survey report and query the database to view all data

The following article, published in ‘This Day’ on 20 August 2007, comments on the findings of a price and availability survey conducted by the Nigerian Federal Ministry of Health in 2004, using the WHO/HAI methodology. Price and availability data was collected for 34 prescription medicines, across 129 facilities in the public and private sectors in 6 states in the country.

It is an unsettling irony that in a country plagued by all kinds of diseases and with a measly average personal income, simple medications are so expensive to buy. This long standing tragedy has been confirmed by a recent World Health Organisation (WHO) report that rates Nigeria as one of the eight countries in the world with exceptionally exorbitant drug prices. The international health agency is worried, as all well-meaning Nigerians should, about the implication of this for health care delivery.

The first thing to be said about this disconcerting report is that it indicts the Nigerian government as one that is insensitive to the health care needs of the people. The WHO report shows that as many as 90.2 per cent of Nigerians who live on less than N256 a day and government workers who earn a minimum wage of N179.40 daily, cannot afford essential drugs. This, of course, includes simple medications for the treatment of common diseases like fever, malaria and other variants of it so common in the country. For the millions of Nigerians who fall within this bracket, the implication of this high cost of medicines is better experienced than imagined. There is such a grim possibility that most of such people had never had the opportunity of taking any pharmaceutical drugs because they cannot afford them. It is no wonder then that patronage of herbal potions prepared in less than healthy environments and with doubtful therapeutic value is so widespread in the country.

As the WHO aptly noted, medicine prices are important because most Nigerians purchase their medicines out of pocket. Thus high medicine prices would constitute a major barrier to access to health care. That is putting it starkly. The truth is that most Nigerians depend on self-medication for simple common ailments. When it becomes difficult for them to afford medicines for the treatment of such ailments, it would only spell doom for many families. In many instances, a number of them have simply resigned themselves to fate while others passed away, just because they could not afford to buy their common pills or pay for the doctors prescription. Which ever way this is viewed, it is a sad commentary on governance in the country.

What then is the way out of this embarrassment? We agree with the WHO that the government needs to review the nations drug procurement policy, without necessarily compromising standards. The National Food and Drug Administration and Control (NAFDAC), should consider prices before issuing marketing authorization to manufacturers and importers. This is crucial because there is evidence that a good number of them exploit consumers through profiteering. The NAFDACs role should not be to merely check fake and substandard products but also to ensure that drugs are sold at reasonably affordable prices.

There is also the need for government to take another look at the tariffs on pharmaceuticals. It is possible that they are not friendly enough to good pricing in this vital sector. Where that is the case, the government should not hesitate to review them downward. Local manufacturers need also to enjoy favourable excise duties and lower tariffs on raw materials. All of this may lead to a significant reduction in drug prices. Without easy access to affordable and genuine drugs by Nigerians, the nations health care system is imperilled. We see no reason why generic medicines should be too expensive for an average Nigerian. If it requires that government should subsidize such drugs, why not. That sort of sacrifice can never be too much for the health of the people.

Click here to access the survey report