Originally presented at National Biomedical Ethics conference by S Srinivasan of LOCOST Baroda

1. •12/5/2010
Acknowledgments
Increasing the Availability of Medicines in Public
Health Facilities • Dr Samit Sharma, Collector, Nagaur, and formerly of Chhitorgarh,
Rajasthan for inspiring work and liberty taken to quote from his slides
• Prayas Rajasthan and Dr Narendra Gupta, for study quoted
-S.Srinivasan • Dr S.Sakthivel, PHFI, for slides 7-11 reproduced with thanks.
LOCOST, Baroda, India
Email: locost@sify.com For further reading:
• The Layperson’s Guide to Medicines, LOCOST, 2006, at
http://www.scribd.com/document_collections/2474529
• Low Cost (Generic) Medicines Initiative, Nagaur/Chittorgarh at
http://nagaur.nic.in/GMP.htm and at
http://chittorgarh.nic.in/Generic_new/generic.htm
National Bioethics Conference, New Delhi, Nov 18, 2010
1
What can be done about providing medicines to If drugs are not made available free in public health
services?
patients in a public system?
• People seeking tt will decrease
• If at all, patients will end up going to go to pvt practitioners
and retail drug shops
» Provide it
» Provide it free • And get exploited
» Do not get into user charges
• With the usual result: indebtedness
3 4
Why should we do give medicines free? -1 Why should we do give medicines free? -2
• Healthcare expenditure is the second greatest cause of rural indebtedness in • Medicines account for 70% of out-of-pocket expenditure.
India today.
• As of 2008, 72% of total healthcare expenditure was privately funded, • Even if patients are able to receive a free check-up at a
89.5% of which was paid out of pocket by patients. government clinic, they are often forced to pay out-of-pocket
for the actual medicines prescribed for their illness.
• Between 1999-2000, 32.5 million patients fell below the poverty line after
just a single hospitalization.
• At the local chemist, patients often pay a price 2 to 40 times
• 40% of those hospitalized are forced to borrow money or sell assets to meet higher than the bulk cost offered by pharmaceutical companies
costs, and 23% of ill patients simply never seek treatment because of their to retailers, private hospitals, nursing homes and government
inability to pay. agencies.
• WHO estimates that 65% of India’s population lacks regular access to
essential medicines.
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2. •12/5/2010
Households’ Share of Drugs Households’ OOP Expenditure by Components
in IP & OP Exp. Expenditure by Rural Urban Total
Care/Services
90 Outpatient 68.52 62.12 66.10
80
% Spent on Drugs
Inpatient 21.25 27.14 23.48
70
60 Delivery 3.11 3.96 3.43
50
Post-Natal 0.65 0.59 0.62
40
30 Ante-Natal 1.25 1.52 1.35
20
Immunization 0.30 0.88 0.52
10
0 Family Plg. 3.15 2.29 2.83
Drugs to IP Drugs to OP Drugs in OOP
Med. Atn. At 1.76 1.49 1.65
Death
Rural India Urban India
T.Exp. Health 100 100 100
Source : NSS, 2004-05. IP-Inpatient; OP-Outpatient; OOP-Out-of-pocket
Trends in Catastrophic & Poverty Impact of Impoverishment Due to OOP Payments in India
OOP Spending - India (In Millions)
OOP Related Parametres 1993-94 1999-00 2004-05
Avg. PC Monthly OOP 16.78 33.08 40.82
(Rs. At Current Prices)
% OOP to HH Exp. 5.12 5.78 6.61
% HH Reporting OOP 59.19 69.23 63.32
% HH >10% as OOP* 11.92 10.84 13.09
% BPL 36.00 26.10 27.50
% BPL after a/c for OOP 38.97 29.17 31.20
Rise in Poverty Ratio (%)
Note: * Denotes OOP as a Share of Household Exp.
2.91 3.07 3.55 Source: Selvaraj and Karan (2009)
Source: Authors’ Estimate, Selvaraj, S and Anup K. Karan (2009)
Drug Expenditure by Govt. Are India’s “low-priced” drugs affordable in India?
States Drugs & Med.* ( Mln) Health Exp. (Rs. Mln) % of Drugs to Health
Andhra Pradesh 1270.45 13142.40 9.67
Assam 153.01 3269.08 4.68
Bihar 220.31 7134.84 3.09
Chattisgarh 250.26 2258.71 11.08
• Affordable for whom?
Gujarat 269.38 7154.79 3.77
Haryana 309.61 3147.09 9.84
Karnataka 778.39 9863.31 7.89 • Cost of drugs for multi-drug resistant TB (maintenance phase) is
Kerala 1242.06 7293.15 17.03 equivalent to 737 days of daily wage of a wage laborer in India
Maharastra 2030.59 17837.95 11.38
Madhya Pradesh 792.19 6668.93 11.88
Orissa 213.02 4213.57 5.06 • Daily wages is Rs 60/- average (One Euro = Indian Rupees 70)
Punjab 91.63 6182.64 1.48
Rajasthan 904.50 9731.16 9.29
Tamil Nadu 1809.72 11843.28 15.28
• Coronary heart disease: 209 days of wage labor
Uttar Pradesh 710.42 13557.88 5.24
West Bengal 579.84 13194.83 4.39
Central Govt.* 7264.92 59770.00 12.15
• Prevention of Hepatitis A: 30 days of wage labor
All-
All-India* 18890.38 1962636.86 9.63
Source : Budget Documents, Respective States & Central Govt.
12
* Many states report drug expenditure under the category of Materials and Supplies.
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3. •12/5/2010
Are India’s “low-priced” drugs affordable in India? Pricing Anomalies of India’s Drugs
• Overpricing
• An unskilled worker in US or UK needs to work for
10 minutes to buy 10 tablets of Paracetamol • Profit margins can be up to
4000 percent
• In India a daily wage worker will have to work • Different brands of same
atleast one hour. drug sell at vastly different
prices
• And our Paracetamol is one of the cheapest in • Most drugs out of Govt
price regulation
the world!
13 14
Cost of Treatment with Biotechnology-based Drugs Tender Prices a Fraction of Retail Prices!
• Abciximab (antianginal, Eli Lily): Rs. 39,480 for a 60 kg man per day
• Govt tender prices fraction of retail prices
• Epoeitin alfa (Wepox/Wockhardt, Treatment of anemia of chronic
• For example: Albendazole 1.89 percent of market price!
renal failure): Rs. 10,200 for 8 weeks for a 60 kg man AND
• Amylodipine: 6.13 percent of market price!
• Rs. 1912 to 11475 per week for a 60 kg man thereafter
• See www.tnmsc.com for tender prices of a good,
transparent govt procurement agency
• Interferon alpha-2a (Roferan-A/Nicholas Piramal)used in types of leukemia:
Initial therapy costs of Rs. 43,552- Rs 1,30,656 then maintenance therapy costs [See also: Srinivasan, S. “How Many Aspirins to the Rupee? Runaway Drug Prices”, Economic and
of Rs. 1,06,158- Rs.3,18,474 (6-18 months tt cost) Political Weekly, February 27-March 5, 1999]
• Etanercept (Enbrel/Wyeth) –in severe arthiritis: Rs. 18,131 per week of
therapy which has to be taken long term.
Thanks to Dr Anurag Bhargava of JSS Bilaspur for these data, Sep 2007.
15 16
Comparison of Retail MRPs and LOCOST prices
Name of Drug Use LOCOST selling prices Market selling prices per tab Difference in a vaccine’s MRP and the price at which it is offered to physicians
per tab (Rs) (Rs)
Vaccine Constituent vaccines MRP, in Price Discount Percentage
Rs offered in Margin of
Albendazole 400 mg For worms Rs 1.10 Rs 9 to 12 2008 to Rs profit
physicians, for the
Amlodipine 5 mg In high blood pressure and as Re 0.25 Rs 1.40 to 5.00 (A) in Rs (A-B) physician
antianginal (B)
(A-B)*100/ B
Atenolol 50 mg In high blood pressure and as Re 0.20 Rs 4 to 22
antianginal Pentaxim Diphtheria, Tetanus, acellular 2066 1446 620 42.9
pertusis,
inactivated poliomyelitis
Enalapril 5 mg In high blood pressure mild to Re 0.30 Rs 1.60 to Rs 2.30 vaccine,
moderate Haemophilus influenzae b
conjugate vaccine
Imovax Inactivated Poliomelitis 365 280 85 30.4%
Fluconazole 150 mg Fungal Infections in AIDs and Rs 3.50 Rs 28 to Rs 32
Polio vaccine
other conditions
Tripacel Component pertusis, 1211 762 449 58.9%
Diphtheria and tetanus
Cetrizine Anitallergic Re 0.20 Re 0.50 to Rs 3.00 17 18
toxoids
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4. •12/5/2010
Okavax Varicella vaccine 1468 986 482 48.9%
Case Study: District Level Intervention
Avaxim Hepatitis A Vaccine 952 665 287 43.2%
80
TetractHi Diphtheria, Tetanus, pertusis, 504 305 199 65.2%
b Haemophilus
The
influenzae b conjugate Chittorgarh/Nagaur Model
vaccine Of
Low Price
Govt. Cooperative Medical Store
ActHib Haemophilus influenzae b 426 251 175 69.7%
conjugate vaccine
Source: Rakesh Lodha , Anurag Bhargava . “Financial incentives and the prescription of newer
vaccines by doctors in India.” Indian Journal of Medical Ethics Vol VII No 1 January - March
2010 19
Step 2 : Govt. Cooperative Medical
Stores provide low cost medicines
Step 1 : Doctors prescribe drugs by generic
of well reputed companies
(salt) name,
as directed by the state govt.
• Medicines to be procured were listed by generic name
Issues raised • To ensure purchase of quality medicines a committee of doctors was
constituted.
• Quality ? • The committee recommended that drugs of reputed companies like Cipla,
Cadila, Ranbaxy, German Remedies, Alembic, etc. can be purchased .
(Initially 22 and now 57 companies are approved)
• Combination preparations ?
• Open tender by cooperative department.
• Chemists will give brand of his choice ? • 800 medicines and 200 surgical items & I.V. fluids were procured at L1.
• Govt. can put a ceiling on MRP ? • The medicines are then sold at 20% profit margin to the patients.
• Price lists were displayed outside the coop. stores
Step 3 : Awareness Generation
• Counseling of Doctors
• Training of pharmacists
• Patient education
• Use of press
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5. •12/5/2010
THE BEGINNING
THE IMPACT: many human lives saved THE IMPACT: many human lives saved
•5

6. •12/5/2010
A positive side effect!
Generics advertised by pvt pharmacists! Necessities For
MAKING MEDICINES AFFORDABLE
• Generic prescribing
Step 1 • Adoption of essential drugs list = Rational Use Of
Drugs
• Standard Treatment Guidelines
• Centralized drug procurement : open tender system
• Distribution of Low cost drugs through Govt. drug counters
Step 2
– Life-line drug stores (run by RMRS)
– Co-operative Medical Stores
Step 3 • Public awareness and demand generation
How much does it cost? How much is Rs 6000 crores?
• The sum of Rs. 6000 crores is only one-tenth the annual
budget of the National Rural Employment Guarantee Scheme.
• If medicines are acquired at the bulk prices (mentioned above
in this chapter), it should only require around Rs. 6000 crores
additionally to provide free treatment for all diseases not • As of 2008, the Indian government spent 1.12% of the
requiring hospitalization. country’s GDP on healthcare, which is extremely low
compared to most countries of the world, including several
• Not only will this allow universal access to medicines for poorer countries in Sub-Saharan Africa.
India’s citizens, but it will place significantly less burden on the
healthcare system, as medicine costs will be reduced to the
bulk prices paid by the government. • When the UPA government came to power in 2004, it
promised to increase the health budget from 0.9% to 2-3% of
• On the other hand, if each patient continues to buy GDP annually.
individually, the total cost for the same amount of medication
would be Rs. 25000 crores. • The additional sum of Rs. 6000 crores would not push the
health budget to even 2% of GDP. It is therefore affordable,
Source: Prayas Study, 2010 and the right thing to do.
33 34
It is indeed possible
• The experiences of TN, Delhi State, Chittorgarh District shows
low priced good quality medicines can be available in the
public sector.
• All these examples are of working within the ‘system’
• There has been no shortage
• Not only that it makes sense to set up shops at retail level to
make available at these prices!
• Nothing is stopping us except political will!!
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