Poor countries pay more for medicines – study

Everyday drugs can cost up to 20 to 30 times more

| THE INDEPENDENT | Basic, everyday drugs can cost up to 20 to 30 times more in some poor countries than others, according to a new study released on June 17 by the Center for Global Development. The study examined billions of dollars of health spending on common, life-saving medicines in developing countries, mostly in Africa and Asia. To date, it is one of the largest-ever studies on global health procurement.

Amanda Glassman, one of the authors of the study and the executive vice president at the Center for Global Development, said poor countries pay more than others for common medicines to relieve pain or treat hypertension in large part because of flawed drug buying practices and broken generic medicines markets.

Glassman’s research focuses on priority-setting, resource allocation and value for money in global health, as well as data for development.

Kalipso Chalkidou, the director of global health policy at the Center for Global Development and an author of the study said a robust market for generic drugs is a core part of an affordable health system. But in way too many countries, generic drug markets are broken and patients are paying the price, she said.

But in countries such as Zambia, Senegal and Tunisia, everyday drugs like paracetamol can cost up to 30 times more than in the UK and USA.

The very poorest countries are currently not affected when foreign donors purchase medicine on their behalf, meaning their over-the-counter medicines remain at low cost. But with income levels rising, low- and middle-income countries face the prospect of a transition from donor aid. Yet many poor countries have limited experience and capacity in procurement-related functions.

Richer countries, thanks to public money and strong processes for buying drugs, are able to procure cheaper medicines.

Low- to middle-income countries “have little ability to negotiate prices down and quality assure products” and there are lots of mark-ups, often due to taxes and corruption.

“You need enough competition to keep prices low and quality assurance that consumers trust, or essential medicines are going to be much more expensive than they should be,” Chalkidou said.

Also, poor the disease burdens in poor countries is shifting from infectious to noncommunicable diseases such as cardiovascular disease, cancer, and diabetes. To meet their citizens’ evolving health needs, governments will need to purchase and make available a very different set of health products from those procured today.

The report noted that health product purchasing in low- and lower-middle-income countries already makes up a sizeable share of overall health spending.

Procurement is not only essential to the missions of global health entities like the Global Fund, Gavi, UNICEF, UNFPA, and PEPFAR, but it also represents big money. In the case of the Global Fund, health product procurement accounts for $2 billion per year, or almost half of its 2017 disbursements.

Yet despite its importance, procurement is an underappreciated health system function.

“Today’s procurement systems are hobbled by inefficiencies that leave some of the poorest countries paying some of the highest drug prices in the world,” the report says.

As governments strive to achieve universal health coverage within tight budgets, they will have to make procurement decisions that deliver the most value for money.

The Center for Global Development convened the Working Group on the Future of Global Health Procurement to review the evidence and formulate recommendations for how the global health community—international health organisations, their bilateral and foundation donors, and low- and middle-income countries—can ensure affordability of global health procurement.

Discussion focused on the journey of a health product from manufacturer to a centralised warehouse or other wholesaling facility.

The study had three main findings: First that developing countries, prices for basic generic medicines can vary widely and far exceed wealthy-country prices. Some purchasers in low- and middle-income countries pay as much as 20 to 30 times more for basic generic medicines like omeprazole used to treat heartburn, or acetaminophen (also known as paracetamol), a common pain reliever.