Present pharma pricing policy will hurt both patients and industry in the long run: Experts

Suitable alternative required to balance the need for low drug prices, sustained innovation and access to affordable healthcare

Pharmaceutical analysts in India and abroad believe cost-based pricing is not suitable to safeguard the interests of patients as well as the pharma industry. In their opinion, the regulatory authorities have wrongly been focusing on price controls in the belief that this will boost access to healthcare. But the experience of other nations, and India’s past experience, indicates the desired outcome won’t be achieved via price caps because multiple hurdles hinder healthcare access in India – and it is these that need to be addressed.

David Taylor, Professor of Pharmaceutical and Public Health Policy at UCL School of Pharmacy, University of London said, “The efficacy of modern medicines has pushed average life expectancy in India from little more than 40 years in the 1960s, closer to the world average of about 67 years. But this success has sparked an increase in non-communicable diseases, which present-day treatments cannot cure. The situation makes it imperative to support the search for innovative drugs that cure such ailments. Price caps have the opposite effect, though, by disincentivising the sale of innovative drugs or drug research in India. Patients with incurable endemic diseases will continue to suffer in silence since cures for such diseases may no longer be actively researched.”

Keeping this in mind, Taylor believes healthcare authorities should avoid cost-based pricing or price caps. Instead, a balance is required between the public need for low-priced drugs, and societal needs for sustained innovation and access to affordable healthcare. Under the draft National Pharmaceutical Pricing Policy, expansion of the Essential Medicines list could include a wider range of products, backed by a narrowly-defined, cost-based pricing system. If this scenario comes true, producing and selling drugs for such treatments in India would be so unviable that supplies will be curbed, not increased.

Dr H L Kapoor, President, IMA Himachal Pradesh State Chapter said, “Since India has the lowest medicine prices in the world, more price cuts would be counterproductive. Low costs do not necessarily translate into improved healthcare access. Universal access to affordable, quality healthcare calls for robust investments in health infrastructure and other facilities across the nation, not just in urban areas. The experience of other countries such as Philippines has shown that driving down drug prices only benefits those who can pay because the poor who cannot afford medicine costs are unable to purchase drugs even when costs are lowered.”
In India, low-priced drugs would be meaningless when 70 per cent of the population do not have primary healthcare centres (PHCs) near their homes. In some cases, rural residents trek as much as 20 km just to reach the nearest PHC, where most medicines are available free – provided stocks are available. The issue for the poor in rural regions is therefore not pricing but proximity and convenience.

Added Taylor, “Highlighting the high prices of cancer drugs to call for lower prices is not a sound argument. Considering the high costs of research in oncology, capping the prices of these drugs may only force manufacturers to withdraw such drugs from the market if the prices are insufficient to cover research, discovery and distribution costs. Instead, in the case of cancer care, support systems need to be created and funded by the state to ensure that those unfortunate enough to develop cancer do not go without treatment due to financial constraints or cost issues.”

Taylor concluded that a state-backed system of healthcare financing could best ensure affordable, accessible healthcare for the masses, particularly in unfortunate cases such as cancer.

EP News Bureau – Mumbai