Cheaper medicines for real

According to the Philippine Statistics Authority (PSA), the average Filipino consumer spent P7,496 on health care in 2018. This was a 6.6% increase from the 2017 average spending on health care products and services. This means that the average Filipino household – with five family members – spent more than P37,000 on health care alone. This is a significant burden to the shoulders of the head of the family earning daily minimum wage.

Thus, the Universal Health Care Law (UHC) approved earlier this year will hopefully reduce the economic burden of health care for many underprivileged Filipinos in the long term. Like all ambitious social service programs of the Philippine government, however, the UHC will take a long while to get rolling with the usual funding lack problem as biggest challenge.

The UHC Law provides a minimum six-year transition period for the progressive national rollout of the program. Thus, the government needs to come up with fast-acting solutions to lessen the health care costs shouldered by families at the lower end of the socio-economic spectrum.

A good place to start is to rein in the rising costs of medicines. Calculations based on the same PSA indicated the average Filipino spent P2,024 on medicines alone in 2018. This equates to P10,120 spent by a family of five. Overall, this should translate to a staggering gross sales figure of P206.7 billion for the Philippine pharmaceutical industry.

Thankfully, the Department of Health (DOH) is not content to just sit on their hands while waiting for the UHC Law to come to fruition. 

Health Secretary Francisco Duque III has earlier recommended to President Rodrigo Duterte to issue an Executive Order (EO) that would implement the “maximum drug retail price,” or MDRP for brevity’s sake, for the meantime rather than wait for the 18th Congress to legislate it. The DOH recommended a list of 120 medicines to be subjected to MDRP.

Obviously, the legislative route would take a longer time, not to mention the intense lobbying by the major players in pharmaceutical industry, both local and foreign medicine manufacturing companies.

The imposition of the MDRP is a power vested to the President by the Universal Accessible Cheaper and Quality Medicines Act of 2008 under Republic Act (RA) 9502. According to Duque, this executive power is to be used “in instances where the lack of competition has affected prices of medicines to be inordinately high that it limits access, especially for the poor.” This is precisely the situation we have found ourselves in now.

The proposed list covers 120 drugs for “catastrophic conditions” such as cancer, hypertension, diabetes, cardiovascular disease (CVD), chronic lung diseases, neonatal diseases, and major cancers. It also covers high cost treatments for chronic renal disease, psoriasis, and rheumatoid arthritis.

The DOH asserts the MDRP will result in a median price reduction, at the very least about 50% for these medicines. Most especially needed to be brought down are the very prohibitive prices of medicines being used to treat serious illnesses such as cancer, chronic kidney disease, heart disease, and even the human immune virus-acquired immunity deficiency syndrome (HIV/AIDS).

And these illnesses do not distinguish whether those who will get afflicted is rich or poor. But these are the dreaded deadly diseases that can shorten one’s life, especially if not treated at early stage.

It is only fitting that the MDRP would be activated for the second time during the second term of Duque as DOH Secretary. It was during Duque’s first stint as Health Secretary that an MDRP was first imposed through EO No. 821, series 2009, resulting in a retail price reduction between 30-70% for 69 drugs.

Frivolous free market advocates and the so-called “big pharma” have been quick to label the proposed MDRP as an unnecessary populist scheme meant to score political brownie points for the Duterte administration. Nothing could be further from the truth.

The precise price cap proposals are the product of 10 years of careful research and price monitoring by the DOH and the Drug Price Advisory Council (DPAC), based on a transparent formula that takes into account established health, price, and market competition indicators.

The DOH and DPAC are definitely onto something big here. I hope President Duterte will act quickly and sign the EO to implement the MDRP as soon it reaches his desk. The MDRP will save Filipino families billions of pesos on health care expenses. More importantly, sick Filipinos will be provided greater access to medicines that could very well save their lives.

The DOH is in the process of wrapping up its public consultations with various stakeholders. As previously committed by Duque, the inputs from these consultations will be considered before the draft EO is finalized for submission to the Office of the President.

That is if President Duterte will sign the proposed EO by December at the latest. Once signed and issued, there would be 120 days before this takes effect and provide enough time for the pharmaceutical industry to consume their existing stocks in their inventory.    

Duque earlier rejected the offered initiative of the Pharmaceutical Healthcare Association of the Philippines (PHAP) to voluntarily cut down prices of medicines instead of the government coming out with a new set MDRP. This was after PHAP executive director Teodoro Padilla previously called it out to Duque that it would be better for the DOH and the industry to work together than for the government to control drug prices.

Naturally, the government must not just rely on PHAP and its member-companies to cut their drug prices on their own terms. Of course, it must be emphasized the quality and efficacy of these life-saving drugs and medicines must not be compromised to make them available at cheaper prices.

Making a fearless forecast, the DOH chief is hoping prices of more than 100 or so drugs will finally be lowered, making cheaper medicines available to all Filipinos for real by April 2020.