Paracetamol for pain or a fever, an antibiotic for an infection, an antacid for indigestion, and an antiallergic tablet for a rash. We have a medicine within the reach of our nearest chemist shop for almost every medical issue or disease. Does it happen to you that so when you purchase not more than 5 strips of different compounds, small enough to fit in a tiny brown paper envelope, you end up getting billed for over a thousand bucks? Well, that probably might be the case. The prices of prescription drugs, from the regular ones to the rare ones, are hiking up every year.
There has been substantial advancement in the pharmaceutical industry in terms of research, newer drug compounds that can treat us faster, reduction in side-effects of existing ones, even the introduction of medicines that can cure problems that were untreatable until recent times, but none of this will suffice unless the prices of these prescription drugs are taken under control, if not, we might end up pricing ourselves and the economy into oblivion. Not forgetting to mention, the absence of parity between the very same compound and dosage of a drug of two different pharmaceutical brands, not just by mere bucks, but by over a hundred rupees or so.
The issue doesn’t involve just everyday drugs, but a major price hike has been patterning in case of drugs that treat diseases like cancer, arthritis, and diabetes. In India, it was the very last month when the prices of a bunch of essential drugs were hiked up, where the prices of drugs are regulated by NPPA, National Pharmaceutical Pricing Authority, a government regulatory agency. The NPPA invoked paragraph 19 of the Drug Prices Control Order in December in order to grant a 50% increase in the prices of 21 drug formulations that include antibiotic tablets, medicines used to treat leprosy, BCG vaccine, and even Vitamin C tablets.
With the cost of raw material imported from China increasing 50-200%, pharmaceutical lobby groups had approached the government to invoke extraordinary powers and increase the prices of drugs. Over 70% of India’s bulk drug requirement comes from China. These bulk drugs or active pharmaceutical ingredients (API) are used to produce medicines, including antibiotics, vitamins, and folic acid.
Pertaining to such high ingredients, and low selling prices, many pharmaceutical companies were withdrawing from manufacturing these drugs altogether. But is a 50% hike in essential drug prices, all at once still justifiable? Rather, the Government should establish a system for monitoring API prices and fluctuations to ensure that essential drugs are both available and affordable, these price hikes end up hitting the poorer sections the worst and the hardest.
India is the largest provider of generic drugs globally. Indian pharmaceutical sector industry supplies over 50 percent of global demand for various vaccines, 40 percent of generic demand in the US and 25 percent of all medicine in the UK, now with such drastic changes in prices, the sector faces risks that can impact the economy. The pharma industry is currently growing at around 11 percent per annum as compared to a high of around 15 percent about five years ago.
The astonishing fact is that the problem is not just the rising prices of prescription drugs, even the price regulation and fixation done to bring down those costs create an issue. While the government has been controlling prices and checking irrational fixed-dose combinations, it has not made investments to strengthen the drug regulatory institutions. According to the pharma companies, this could lead to a situation where a big player is competing with a spurious drug manufacturer. The list of drugs under price control has steadily expanded from 74 in 1995 to nearly 860 by 2019. The prevailing thinking in the country is that prices should be brought down through measures like listing drugs as essential and imposing price caps.
There can be a debilitating negative impact on the healthcare system and its innovation due to such measures, as more Indians gain better access to healthcare, the quality of drugs, from stents to prescription drugs will be heavily dependent upon the price regime and whether there is room to reward new innovations. It is trading quantity over quality, there is a need for a middle ground to be found without much delay, or we are costing away from the health index for the sake of reducing the price of medicine. Another reason for these price hikes is the existence of a strong Intellectual Property Regime. With the heavy sum of money that pharmaceutical companies invest into the research of molecular formulation of medicines, they never fail to register for patents in order to recover their investment, this, in turn, disallows any other manufacturer from making the same drug, giving the absolute freedom to price them without any intervention.
This issue is not restrictive to one country, it is spanning everywhere. Research in the US showed unimpeded price increases in the pharmaceutical market. In the study, researchers from the Scripps Research Translational Institute analyzed Blue Cross Blue Shield pharmacy claims from 2012 to 2017, focusing on a total of 49 brand-name drugs that had more than 100,000 total claims each.
All but one of the drugs included in the study saw regular annual or biannual cost increases. The cost of 36 of the drugs increased over the six-year period by more than 50 percent, and the cost of 16 more than doubled. Overall, the median cost of the drugs included in the study increased by 76 percent. And the researchers do not believe that this trend will slow or stop any time soon, major pharmaceutical companies aren’t in a rush to curb soaring drug prices, either.
At the heart of the problem are the pharmacy benefits managers (PBMs). These organizations are the middlemen that negotiate between pharmaceutical companies and those who pay for drugs such as hospitals, pharmacies, insurance companies, and government agencies. PMBs also establish the formularies – the schedules that set the terms on which you, the patient, can access particular drugs and the reimbursement rates you will get.
In a perfect world, PMBs would be negotiating to obtain the best prices possible for you and for your health insurer. Instead, because of the perverse way the system is structured, PMBs help keep the prices high. The drug price increase is a serious matter across the world. The NHS in England can no longer afford Orkambi, a drug used against fibrosis. The Dutch are struggling with increasing costs of the immuno-oncology drug, Keytruda. Access to healthcare is becoming increasingly difficult as inelastic prices of medicines make patients pay more and more, even as demand rises.
With this increasing demand for healthcare, ensuring reach requires cheaper and far more easily available drugs. Countries should be working towards providing incentives for pharmaceutical research by way of encouraging higher outlays in research and development, even more so for rare and neglected diseases. It is probably necessary to establish trade margin rationalization. A complex supply chain exists in the drug market, from the stockist to the retailer. Hence, rationalizing trade margins would result in regulating prices for prescription drugs and medical devices by quite a level.
Rather than just focusing on the final prices of the drugs, it is also required to see the prices of compound ingredients required to produce them. Not to forget the failures of the government to invest in the healthcare sector, there is a pervasive need for the governments of countries to not just regulate the private healthcare and pharmaceutical sector, but to invest in it.
Innovation, advancement, the development will mean nothing if no one can have access to the benefit of it. Measures need to be taken to stop this seemingly never-ending increase in prices of these prescription drugs, someone has to stop fuelling this airplane soaring higher above the common man’s eye level and bring it to reach. Healthcare is a basic right, paying money to the doctor to get a prescription only to end up not being able to buy it is not going to improve the situation, from vitamin pills to tablets for diabetic and cancer patients, the prices of medicines need to be put under control.
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A free spirited individual in her second year, pursuing Bcom.(Hons) from Shri Ram College of Commerce, she is an extrovert who loves learning more and more from everything around her, fueling her motivation to do more to be a better person with every passing day. A classical dancer since the age of 4, a music lover and most importantly someone who is passionate about helping others and creating a positive impact on the society.