Society hostage to immoral drug firms
11 Oct 2012 10:30 PM GMT
For the privileged few – the super rich and those whose entire medical bills are picked up by their employers, past or present – medication costs may not matter, although side effects of over-drugging and too frequent electro-medical tests could shorten or even cost their life. To the rest, the increasing cost of medicare, especially on medicines, could be a nightmare. Imagine, an underprivileged person suffering from chronic liver or kidney cancer is asked to shell out over Rs 2,50,000 for a monthly course of original Bayer’s Nexavar pills. He or she would probably prefer a quick painful death to those prolonged painkiller-cures.
Thanks to the government’s belated action against the German pharmaceutical profiteer, the local generic version of the drug is now available for Rs 6000-8,000. Bayer has threatened to legally proceed against the government for patent infringement before the World Trade Organisation [WTO]. The government is unfazed. It was a strong warning message served to the ruthlessly profit-hungry global drug formulators across the country. Even the Supreme Court of India wants the government to act fast to control the prices of 348 ‘essential’ or scheduled drugs, after the latter had set up a high-powered committee on the new drug policy and sat over the decision for almost a year. Latest reports from New York suggest, Roche, the giant Swiss multi-national pharma-manufacturer, is all set to slash the price of two expensive cancer drugs [names and prices undisclosed] in India, as part of efforts to strengthen its position amid rising competition from generic drug makers. ‘Roche Holding AG is cutting the price of two expensive cancer drugs in India and giving them new names in an effort to gain market share and avoid competition from generic drugs in the fast-growing economy,’ the Wall Street Journal has reported. The Roche head of Middle East and Asian markets, Tuygan Goeker, said the prices would be cut in India starting 2013.
The latest recommendation before the union cabinet by the Group of Ministers [GoM] for a new drug policy has called for fixation of the maximum retail price [MRP] of 348 essential medicines at the average price of all brands in a segment that has more than one per cent market share by sales. The idea is to reduce the prices of several costly brands to benefit the patients and also allow many low-cost medicine manufacturers to increase their price. The GoM has also recommended not to extend exemptions to medicines priced under or at Rs 3 a tablet. The draft National Pharmaceuticals Pricing Policy of November 2011 had listed certain exemptions for all drugs costing less than Rs 3 a unit.
The draft policy had proposed that price control be exercised on all 348 drugs with 614 dosages of each of the medicines as specified in the National List of Essential Medicines [NLEM] and other combinations of medicines mentioned in the list. ‘It [recommendation] will be a statutory for doctors to recommend generic medicines now. We have decided to price the drugs to the lowest [with one per cent market share],’ Fertilisers and Chemicals Minister Srikant Jena had said. The GoM has also recommended the opening up of more generic drugs stores throughout the country.
Frankly speaking, the GoM recommendation gives too little, too late. It will have a very little impact on drug majors and the overall prices of drugs, which have gone up by an average 30 per cent since 2011. A study shows that prices of 60 per cent of NLEM medicines will be reduced by around only 20 per cent or a little more. Depending upon the nature of drugs, their demand-supply position, market domination by patent-holders and the rarities of the disease, drug firms are known to often operate at profit margins as high as 1,000 per cent to 50,000 per cent on the listed sales price. Few countries in the world, where drugs are among the most expensive manufactured items, have been able to discipline those high profile global pharma majors. Not even the Chinese communist regime.
India’s pharma majors have already launched a vicious campaign to prevent the government from putting its stamp of approval on the GoM recommendation. Over 100 pharmaceutical companies in India said the GoM recommendation would have a severe negative impact on their bottom line and future growth. The local associates and subsidiaries of drug MNCs are using political clouts of their respective parent companies abroad to fight the proposed drug price control order. The union cabinet is already under pressure from both the US and European Union. The EU has been trying to persuade the Indian government to liberalise its patent regime to extend the patent life of drugs in India beyond the commitments made under the Trade Related Aspects of Intellectual Property Rights [TRIPS]. Patents worth an estimated $150 billion, held by European pharma companies, are scheduled to expire over the next five years.
However, few are prepared to believe Indian drug companies, which have created a strong nexus with medical practitioners and hospitals and clinics to ensure robust sales year after year, will be at odds. A recent prescription audit by a well-known Kolkata-based consumer movement society, CUTS, revealed some highly shocking findings, including irrational use of medicines such as antibiotics, proton pump inhibitors [PPI], H2 blockers, vitamins, antipsychotics and antihistaminic drugs among others by doctors. About 98.03 per cent of prescriptions were found to be irrational, leaving only 1.97 per cent to bear the testimony of any rational use of medicines. Such forms of drug abuse help pharma companies the most, while doctors make money out of freebees from drug firms and hospitals from hefty commissions from bulk purchases and recycling of surplus drugs which in-door patients are forced to buy and leave unreturned. All these are at the cost of the suffering common man.
The CUTS study blamed the well-known and deeply entrenched drug firm-doctor nexus to promote push sales of medicines. Some 20 out of 50 pharma firms covered by the study were found to have sponsored events and workshops for doctors. The expenditure on gifts, seminars, at home and abroad, is added to the price of medicines. Doctors are also induced to prescribe expensive medicines despite the availability of their cheaper versions in the market. This month, a large contingent of doctors, collected from all over the country, is being taken to Rome to a week-long sponsored junket.
The $18-billion-plus Indian drug industry is the world’s fourth largest producer of drugs in terms of volume, accounting for nine per cent of the global bulk drug market. In terms of the production value, India holds the 13th position in the world market. The price advantage helped India emerge as a major exporter of drugs, which the western world has been trying to resist by keeping drug prices artificially high in India.
What provided India a big edge over its competitors in the global market are: large manufacturing base for high quality drugs and formulations; cost effective technologies for drug intermediaries and bulk actives without compromising on quality; strong scientific and technical manpower; world-class national laboratories in process development; excellent centre for clinical trials and competencies in chemistry and process development.
It is time that the government takes advantage of India’s clout as a major manufacturer-consumer-exporter of drugs to protect and advance its position in the world market than be allowed to be dictated by western lobbies. For large drug farms, the business has been highly profitable and growing. The annual growth rate is close to 10 per cent, much higher than the western average. There exists a strong case for lower drug prices and stricter rules to break the drug firm-doctor nexus. This will bring about a quantum jump in the country’s per capita drug consumption from the current level of less than Rs 50 per month and help a faster growth of
the market. [IPA]
Thanks to the government’s belated action against the German pharmaceutical profiteer, the local generic version of the drug is now available for Rs 6000-8,000. Bayer has threatened to legally proceed against the government for patent infringement before the World Trade Organisation [WTO]. The government is unfazed. It was a strong warning message served to the ruthlessly profit-hungry global drug formulators across the country. Even the Supreme Court of India wants the government to act fast to control the prices of 348 ‘essential’ or scheduled drugs, after the latter had set up a high-powered committee on the new drug policy and sat over the decision for almost a year. Latest reports from New York suggest, Roche, the giant Swiss multi-national pharma-manufacturer, is all set to slash the price of two expensive cancer drugs [names and prices undisclosed] in India, as part of efforts to strengthen its position amid rising competition from generic drug makers. ‘Roche Holding AG is cutting the price of two expensive cancer drugs in India and giving them new names in an effort to gain market share and avoid competition from generic drugs in the fast-growing economy,’ the Wall Street Journal has reported. The Roche head of Middle East and Asian markets, Tuygan Goeker, said the prices would be cut in India starting 2013.
The latest recommendation before the union cabinet by the Group of Ministers [GoM] for a new drug policy has called for fixation of the maximum retail price [MRP] of 348 essential medicines at the average price of all brands in a segment that has more than one per cent market share by sales. The idea is to reduce the prices of several costly brands to benefit the patients and also allow many low-cost medicine manufacturers to increase their price. The GoM has also recommended not to extend exemptions to medicines priced under or at Rs 3 a tablet. The draft National Pharmaceuticals Pricing Policy of November 2011 had listed certain exemptions for all drugs costing less than Rs 3 a unit.
The draft policy had proposed that price control be exercised on all 348 drugs with 614 dosages of each of the medicines as specified in the National List of Essential Medicines [NLEM] and other combinations of medicines mentioned in the list. ‘It [recommendation] will be a statutory for doctors to recommend generic medicines now. We have decided to price the drugs to the lowest [with one per cent market share],’ Fertilisers and Chemicals Minister Srikant Jena had said. The GoM has also recommended the opening up of more generic drugs stores throughout the country.
Frankly speaking, the GoM recommendation gives too little, too late. It will have a very little impact on drug majors and the overall prices of drugs, which have gone up by an average 30 per cent since 2011. A study shows that prices of 60 per cent of NLEM medicines will be reduced by around only 20 per cent or a little more. Depending upon the nature of drugs, their demand-supply position, market domination by patent-holders and the rarities of the disease, drug firms are known to often operate at profit margins as high as 1,000 per cent to 50,000 per cent on the listed sales price. Few countries in the world, where drugs are among the most expensive manufactured items, have been able to discipline those high profile global pharma majors. Not even the Chinese communist regime.
India’s pharma majors have already launched a vicious campaign to prevent the government from putting its stamp of approval on the GoM recommendation. Over 100 pharmaceutical companies in India said the GoM recommendation would have a severe negative impact on their bottom line and future growth. The local associates and subsidiaries of drug MNCs are using political clouts of their respective parent companies abroad to fight the proposed drug price control order. The union cabinet is already under pressure from both the US and European Union. The EU has been trying to persuade the Indian government to liberalise its patent regime to extend the patent life of drugs in India beyond the commitments made under the Trade Related Aspects of Intellectual Property Rights [TRIPS]. Patents worth an estimated $150 billion, held by European pharma companies, are scheduled to expire over the next five years.
However, few are prepared to believe Indian drug companies, which have created a strong nexus with medical practitioners and hospitals and clinics to ensure robust sales year after year, will be at odds. A recent prescription audit by a well-known Kolkata-based consumer movement society, CUTS, revealed some highly shocking findings, including irrational use of medicines such as antibiotics, proton pump inhibitors [PPI], H2 blockers, vitamins, antipsychotics and antihistaminic drugs among others by doctors. About 98.03 per cent of prescriptions were found to be irrational, leaving only 1.97 per cent to bear the testimony of any rational use of medicines. Such forms of drug abuse help pharma companies the most, while doctors make money out of freebees from drug firms and hospitals from hefty commissions from bulk purchases and recycling of surplus drugs which in-door patients are forced to buy and leave unreturned. All these are at the cost of the suffering common man.
The CUTS study blamed the well-known and deeply entrenched drug firm-doctor nexus to promote push sales of medicines. Some 20 out of 50 pharma firms covered by the study were found to have sponsored events and workshops for doctors. The expenditure on gifts, seminars, at home and abroad, is added to the price of medicines. Doctors are also induced to prescribe expensive medicines despite the availability of their cheaper versions in the market. This month, a large contingent of doctors, collected from all over the country, is being taken to Rome to a week-long sponsored junket.
The $18-billion-plus Indian drug industry is the world’s fourth largest producer of drugs in terms of volume, accounting for nine per cent of the global bulk drug market. In terms of the production value, India holds the 13th position in the world market. The price advantage helped India emerge as a major exporter of drugs, which the western world has been trying to resist by keeping drug prices artificially high in India.
What provided India a big edge over its competitors in the global market are: large manufacturing base for high quality drugs and formulations; cost effective technologies for drug intermediaries and bulk actives without compromising on quality; strong scientific and technical manpower; world-class national laboratories in process development; excellent centre for clinical trials and competencies in chemistry and process development.
It is time that the government takes advantage of India’s clout as a major manufacturer-consumer-exporter of drugs to protect and advance its position in the world market than be allowed to be dictated by western lobbies. For large drug farms, the business has been highly profitable and growing. The annual growth rate is close to 10 per cent, much higher than the western average. There exists a strong case for lower drug prices and stricter rules to break the drug firm-doctor nexus. This will bring about a quantum jump in the country’s per capita drug consumption from the current level of less than Rs 50 per month and help a faster growth of
the market. [IPA]
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