Drug price cut without government price control

I read the news report below in the Inquirer today. Sanofi Aventis is cutting the price of its anti-diabetes medicine for patients affiliated with ISDF, a health NGO. I think this is a welcome move, a unilateral action on the part of a pharma company to bring down the price of its anti-diabetes medicines for selected, target patients.

My brother who died of prostate cancer a few years ago, was also diabetic. It was a deadly combination, diabetes + prostate C. He was lucky to have a private HMO + my well-off sister's support who practically picked up most of the tab in his 2-years of messy and expensive treatment including chemo. The government? It was collecting taxes left and right for all the medicines that my dying brother was taking.

In the past 2 meetings of the DOH Advisory Council on price regulation that I have attended, there was a general feeling that whatever price reduction that a pharma company can give to certain patients, should be made as mandatory and "universal price" for all other patients.

I am not exactly in favor of such proposal because the pharma companies, domestic or multinational, that extend such kind of price cut to certain groups or patients, have educational programs for their patients. They know who are the people buying their medicines, especially the poor patients, so the pharma companies that initiated the price cut can also give additional medical advice, like how to avoid diabetes in the first place. If such initiative is ok, Sanofi will make it a nationwide program, meaning nationwide price cut of their anti-diabetes medicine. Maybe through the patients' pysicians, if no NGO support groups like ISDF are not around.
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http://newsinfo.inquirer.net/inquirerheadlines/metro/view/20090629-212891/Price-of-antidiabetes-medicine-cut

Price of antidiabetes medicine cut

By DJ Yap
Philippine Daily Inquirer
First Posted 00:07:00 06/29/2009

MANILA, Philippines—Combating diabetes among indigent Filipinos has taken a step for the better—and the cheaper—thanks to a new partnership between the pharmaceutical company Sanofi-Aventis and the Institute for Studies on Diabetes Foundation Inc. (ISDF).

The two institutions launched on June 23 a new program called “Innovation for Life,” a new, equitable, tiered-pricing approach toward increased access to insulin glargine (Lantus)—Sanofi-Aventis’ diabetes medicine—among patients who could otherwise not afford it.

Dr. Ricardo Fernando, the founder of ISDF, said the project, which is seen to benefit more than 500 ISDF patients at the outset, was developed “not only for the next few months but for the long term.”

Patients who are accepted to the program stand to get substantial discounts on their Lantus medication, which, depending on their condition, typically costs from P100 to P1,000 every day, organizers of the project said.

“We have to remember that the most expensive medicine is the one that does not work,” Fernando said at the launch of the project at the ISDF offices in Marikina City.

Dr. Benedict Blayney, vice president for medical affairs of Sanofi-Aventis in Asia-Pacific, said the program would also have an education component, in which poor communities would be taught ways to treat or even prevent diabetes.

“We are dipping our toes in the water. If it works well here, we are open to extending the program to other institutions in the Philippines,” Blayney said.

Diabetes mellitus, a serious chronic metabolic disease characterized by an increase in blood sugar levels, is estimated to be the cause of six percent of deaths globally. In the Philippines, it is among the 10 leading causes of deaths.