On the other side of the bill… the medicine price reduction (re) act

I am for the quick and inexpensive procurement of medicine for our people. To borrow from the late Sen. Ted Kennedy who just died the other day, I believe that “health” (and access to its improvement, healing) should be a RIGHT and not a PRIVILEGE. I envy other countries that have made this possible already.

My previous boss and college dean was part of those who supported such an endeavour for our kababayan. I was part of a research by the DOH assessing “Drug Security in the Philippines” which described the process which our people would have to go through before procurement of their most valued medications.

But there’s something WEIRD about these recently implemented drug price reductions.

I can’t help but feel that it was drafted poorly, almost as if it was hurried to achieve a different PURPOSE.

Don’t get me wrong, I laud those who drafted the said bill (specially the Cheaper Medicine Act), but pardon me for suspiciously trying to dissect the implementation of its partnered directive paving way to the Medicine Price Regulation.

To those who know more of this than me, please DO SHED SOME LIGHT. Educate me please. But for now, allow me to release some of my childish cynicisms, if proven wrong, I apologize in advance. But please do hear me out.

"There will be 72 drugs that will be subjected to 50 percent voluntary price reduction starting August 15 given the fast voluntary compliance of drug companies to the government appeal that they reduce their product prices," said Duque.

Let me raise some points:

50% ???????? – Seriously? I really am curious on how this figure came out, was this calculated by intellectual scientific mathematic untainted methods?
I understand that this is for those drugs that is not covered anymore by patent, those with generic counterparts, but is this a little bit too high?

From the pharmaceutical companies and the HONEST businessmen’s point of view, 50% is too much of an overkill. Let us say, 10% of our retail prices were increased due to taxes, 5-10% for overhead fees (employees’ payout), another 10% for infrastructure, travel, and other logistic costs. This doesn’t even include import taxes. From the manufacturers (10% tax), to the distributors (10% tax), to the retail stores (another 10% tax), if such mark down will be implemented, who do you think will cover for a 50% downprice? I bet it will be the workers, the clerks, the drivers, etc.

15% is acceptable. 20% would be almost maximum. But 50%?

Voluntary – yeah right! Possibly for our local drug companies that didn’t have anything to do with the research and development of such drugs, this would not be much of a problem. Their compliance on this will prompt all others to lower the price. It is not “voluntary” it is just the mere effect of competition. You’d loose buyers if your price is still ridiculously higher than the counterpart.

August 15 implementation – Isn’t this a bit too hurried?

I just came from a provincial hospital this morning doing my usual monitoring activities when I got wind that a big chunk of the specialists’ purchased drugs are being lobbied to be returned to the distributor before the 15 September deadline for small scale businesses. Why do you think this is being done? If you buy a 30 pesos worth of drug, and by 15 August/ September, you’d have to sell it at 15 pesos, where do you think the other 15 pesos will go? People, help me out here. Please! I just soooo hate math!

Drug companies – even with the changing of BFAD’s name to FDA (just like US FDA), do you think we are equipped to actually pinpoint those drug companies that sell substandard drug products? How many testing centers do you think we have? One from BFAD, others maybe from schools. At this point let me praise Sen. Pia Cayetano for authoring a bill that would strengthen PH FDA (BFAD) by increasing the number of testing centers all over the Philippines. But when do you think this will be approved and implemented? Again, timing people!

I wouldn’t be sounding like a whining little brat (that I already am), if I see that this regulation is being implemented with some “help” parameters.

Why not take away a percentage of government tax? This way you would really decrease the prices by so much. Do not place the burden of lowering the prices on the businessmen, small and big. Are you afraid you’d loose your own budget?

Why not give the businesses time to sell out those bought at their original price before implementing the big price markdown? Why not give them ample time? Parang FIFO, first in first out for drugs first bought to those that will be affected by the price decrease.

Possible Long term effects

Currently, a lot of pharmaceutical companies have been cutting down on their expenses. And with the recent events, it is probable that some of them might close operations in the Philippines.

I was in Cebu the other day and was surprised that another sales representative (med-rep) of a certain company is bidding his doctors good bye. I was told that this time, they were 78-80 of them. And that’s just the second batch. The first I think were 30 (an increasing trend?), and the next batch will be this December. And I’m only talking about one company.

Another has seized issuing cars to their med-reps and have to cut down on working hours and have been strict on overtimes to cut down costs.

I’m thinking that with this kind of trend, there will be international pharmaceutical companies that will close down operations here and will just leave drug retail to distributors such as Zuellig. Why would they need sales representative with that kind of competition with the generics? They could just have these sold within market and distributed amongst hospitals without the aid of these sales and marketing arm.

My company for one have closed (imagine how many employees are that) last January of this year owing to their change in “business model.” Which basically means that since most of their drugs lost patent already and can be manufactured by the generic companies (and are already household names), they wouldn’t need the sales and marketing arm much and would have to wait for the new drugs in their pipeline to get registered and marketed to have the need to make another sales and marketing arm in this country.

With this kind of trend, sure, our own local companies will have thrived wonderfully, but on whose expense? We will have lost a lot of jobs for many and you really couldn’t expect all these local companies to take in all those who have been laid off. Plus, a number of these local companies still have yet to prove quality to their products. Hello? We are after all the piracy country of Asia if not the world! Even medications are being pirated nowadays.

The trend right now for international companies, if you have noticed is to get a nutritional arm such as wyett or meadjohnsons to somehow support their operations since the nutritionals are still not affected by all these activities.

Why?

Why the urgency, I ask myself. Sure, all these will be favourable to us consumers. But can we stop for a while and look at the greater picture? How can we be able to protect our people from losing jobs?

Is it because of the upcoming elections? Knowing that by doing so, ones’ popularity would have increased? Can’t we hold all these off till we have a more concrete plan AFTER elections?

This is one opinion I have to which I wish I could be wrong and would want more clarifications. Such directive just seems so beautiful that most of our people would’ve been blinded by it. But I urge you, isn’t all these too good to be true?

Why the hurry? I ask, why?