Sunday, June 21, 2009

DOH Meeting on Price Regulation, part 2

The 5th Advisory Council meeting on price regulation was held last Friday, June 19, at the DOH. There were 3 topics discussed. First, an update on drugs that were recommended for MRP issuance by the President. Second, the proposed administrative order by the DOH on how to implement the MRP once the draft Executive Order (EO) is signed by the President. And third, the electronic data base on comparable drug prices, under the DOH website.

The DOH Secretary submitted the draft EO to the President only last Tuesday, June 16. The first official announcement of list of drugs under MRP was last June 8, during the Congressional Oversight Committee hearing at the Senate, where Sen. Mar Roxas, an LP Presidential candidate, most likely pressured the DOH to produce a list of drugs for MRP. The timing was suspect because it was one year since the enactment of RA 9502, June 6, 2008, and there was no clear national health emergencies.

Were there new list of drugs for MRP? Maybe, no one knows yet except the DOH and the Office of the President. Between the announcement at the Congressional Oversight Committee meeting last June 8 to June 16, there could have been new drugs or those in the mentioned list may have been removed. The DOH said from 100 molecules, they later pared the list down to 25 molecules. The final list is with the President, and she will also make her own consultations before signing the draft EO.

Many of us who attended the meeting last Friday were also surprised that the MRP was pushed through considering that the majority sentiment during the 4th Council meeting last June 5, was that MRP is not necessary now, it should have not been pushed. PCPI reiterated their position that they are not in favor of issuing MRP now. I also spoke and argued that price-setting is not a function of the government. Since we advocate minimal government, there is no way that we can support State intervention in setting prices, much less in price control.

After another long and extended discussion on the inappropriateness of medicine MRP, the topic shifted to BFAD’s Administrative Order (AO) on how the draft EO will be implemented. About 3 pages long, saying that drug manufacturers, distributors, retailers, etc. should put the label "price not to exceed the MRP of ____".

This proposal was shot down, not only by the pharma companies (multinationals and domestic) but also by leaders of drug stores. The main argument is that if there are signs that the prices of drugs that have been identified for MRP are coming down to 50 percent or lower, then no labeling will be necessary. Voluntary compliance should be encouraged. Since there are around 5,000 to 7,000 drugstores nationwide, the labelling will have to be done there – drugstore by drugstore, pack by pack, capsule by capsule, etc. This will present a new logistical nightmare. There was a proposal to have a "transition period" of 3 months between the issuance of the EO and the actual implementation of price labelling. Some civil society groups objected, but they were later convinced of the complexity of hurrying the labeling.

I also suggested that since the government has intervened a lot already in drug pricing, government should show some sacrifice. For instance, should price labeling be necessary for some drugs, it should be the government that should do it, not the drug suppliers who already suffered huge revenue cuts, if not suffer losses, with the mandatory and forcible price control. Many participants from the government agencies howled in disapproval to my proposal.

The 3rd and last agenda was the electronic data base for comparable drug prices. Although there are some noble goals for coming up with this list, aside from being mandated or suggested by the new law and its implementing rules and regulations (IRR), the list is projected to raise more high expectations from the public which will only result in high disappointment. For instance, some drugstores will cite prices for the e-database that are lower than their actual retail price and produce various reasons why they did so.

One vocal participant in the meeting commented on the side that we need minimal government on issues like drug pricing. Thumbs up to him, actually a former friend way back from our undergraduate days at the University of the Philippines (UP) in Diliman campus.

Earlier, there was a discussion how to expand the number of participants in the Advisory Council meetings since certain important players were left out. For instance, people have assumed that all multinational pharma companies are members of PHAP and so, PHAP officials can articulate their sentiments. Turns out that there are 3 multinational pharma companies that are not members of PHAP – Pfizer, Servier, and Merck. So these companies are expected to be invited in the next Council meeting next month, before the State Of the Nation Address (SONA) of the President.

The quality of discussions and debates in the Council meetings is high and very transparent. People who have “great” ideas on something can expect that it can be shot down if such grand ideas are not backed up by robust philosophies and solid data. Unlike in Congressional hearings where the presence of legislators is very imposing and dominating, the discussions in the Advisory Council meetings are more free wheeling, fast and frank.

Meanwhile, what can those multinational pharma companies do to question the inclusion of their popular and saleable products in the MRP list? I think they should write to the President, arrange an industry delegation (PHAP, PCPI, other pharma companies that belong to neither) for a meeting with her. There is a unanimous voice from the industry that MRP will be counter-productive at this time, especially with no clear and apparent national health emergency.

Of course there is a possibility, even a small one, that when the pharma industry leaders would come to malacanang for a dialogue with the President, political and financial extortion is a possibility. The 2010 election is less than 11 months from now, all politicians and political parties are stockpiling money and cash.

But then again, this is just a conspiracy theory.

No comments: