After my
discussion on
CWF
Wants Price Dictatorship for Lipitor, Joey Ochave, SVP of Unilab and
Vice-Chairman of MeTA Philippines, reacted to it. We have a nice, friendly and
civil discourse and mini-debate the past two days. The other members of MeTA PH (80+ people in
the email loop) expressed satisfaction reading our exchanges. Copy-pasting them
below raw, zero alteration even comma. Later, another friend,
Karen Villanueva joined. Karen is from Merck and also MeTA PH member. Both Joey and Karen gave me permission to use their comments for this blog post.
The two tables below are not part of the original
exchanges. I made them and inserted them here as additional background info about the
price control or mandatory, forcible 50 percent price cut policy in August
2009. This is about 3,200 words, six pages long
including the two tables. Enjoy.
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I never thought I would say this – I agree with Nonoy. (Biro lang, Nonoy.) Price control is not the answer. It is not a sustainable policy instrument to address issues relating to access.
If I remember correctly, there was a preliminary study done before on the impact of the 2009 MDRP (or MRP, if one is to follow the text of the Cheaper Medicines Law). It showed that the ones who benefited most from the 50% price reduction were those who were buying the “originator” medicines and not the poor who were its intended beneficiaries. The poor, after all, were getting free medicines from the government or already using generic equivalents. (I do not, however, discount the possibility that there were some poor people who having been prescribed the originator brands never used generics and thus were able to benefit from the MDRP. I would assume though that their numbers were not significant.) Hence, if the policy objective is to provide access to the poor, then price control is not the answer. (I just learned from former UP College of Pharmacy Dean Yollie Robles that she just completed a similar study. It would be good if she could share it with META.)
Further, the situation now is much different from that in
2009. Competition in the pharma sector has flourished since then. Filipino
patients have more choices now than before, with several brands at different
price points for every non-patent protected molecule. Since 2009, generic
drugstores have thrived due to the successful marketing programs of TGP and
Generika. Even Watsons has seen it fit to introduce now its Watsons Generics
brand, with all the marketing gloss that one would previously associate only
with “branded” medicines. More importantly, the government put in more money
for medicines, with the latest figures showing a 40% increase in budget. Many
expect this to grow further as Universal Healthcare becomes a reality. After
oncology and kidney transplant medicines, I understand that PhilHealth is
interested in covering also out-patient medicines for diabetes and
hypertension. They have an existing pilot program with a generic drugstore that
they might scale up soon. Hence, while access to essential medicines is still
an issue, there are already several successful initiatives to address it since
2009.
On Pfizer’s differential pricing scheme, this is nothing
new. This is standard practice after patent expiry. Companies will have
different prices for different geographical markets. This is why, for example,
the price in Thailand for the same product by the same company may be lower
than in the US. What is new now is that differential pricing is being done
within a single country. In the Philippines, this has been made possible
because of the Certificate of Listing of Identical Drug Product (CLIDP) scheme
of FDA, which allows a manufacturer to provide several marketing companies a
“daughter CPR” from its Principal (“mother”) CPR. This means that two or more
marketing companies can source a drug from a single manufacturer, and each one
is free to price it depending on its cost structure and intended market. As anyone in the pharmaceutical sector knows,
medicines are priced depending on what the company thinks the “market” will
accept. The definition of “market” depends on the population segment the company
wants to serve. If SEC (socio-economic class) AB, then one would expect a
company to price it higher than another company which wants to serve the SEC D
market. Theoretically, a company may choose to cater to both the SEC AB and SEC
D using identical products, except for the packaging and the go-to-market
strategy. There are many reasons why a company may want to do this – for CSR
purposes, to have a flanking brand, to protect its market share, or as a
product life cycle management strategy, among others. Each company will have
its own reasons.
On the GMAP, it is actually a voluntary price reduction
by selected companies in response to the government’s request. There is nothing
illegal in it, Nonoy. In truth, almost all molecules (except for one) covered
by the Executive Order imposing MDRP are Pfizer products, for reasons all of us
know. Atorvastatin (LIPITOR) is one of them. This means that the current
LIPITOR price is already 50% lower than its pre-MDRP price. If indeed, Pfizer
is supplying Rhea an atorvastatin product that is identical (same manufacturer,
same shape and color of tablet) to LIPITOR and it is 40-60% cheaper than the
current post-MDRP LIPITOR price, then we should welcome this. Doctors and
patients (who continue to prescribe or buy LIPITOR despite the presence of its
generic equivalents) may be advised to shift to Rhea Atorvastatin so they can
save. (I bought samples over the
weekend, and what James says is true. LIPITOR and Rhea atorvastatin are
identical.) Kung ayaw ng RiteMed o Pharex (okay ba, Beau?), then LIPITOR users
can shift to Rhea Atorvastatin. Switch and save, sabi nga ng Watsons Generics.
Rhea, by the way, is only available in MDC.
I was told that Pfizer is also supplying Rhea Mefenamic
Acid. I checked this over the weekend, and it’s true. Totoo nga, parehong-pareho.
Same manufacturer, same color and shape of tablet as PONSTAN. The only
difference is the price – PhP 3.90 for Rhea Mefenamic Acid and PhP 31.25 for
PONSTAN, or almost 10x the Rhea price. This is even bigger than the Rhea
atorvastatin savings. Remember Sec. Pagdanganan during the Cheaper Medicines
Law campaign? Remember when he was comparing the PONSTAN prices in the
Philippines and India and wondered aloud why the big difference? J
While I disagree with James on the price control
proposal, we should nevertheless thank him for his continuing advocacy of
patients’ right and welfare. C’mon, none of us in this email loop has done more
individually for patients than James has. He was an influential voice during
the Cheaper Meds campaign and he was instrumental in persuading PhilHealth to
cover out-patient oncology medicines, especially for childhood leukemia. At the
last META Board meeting, we noted the continuing absence of patient
organizations (except the Psoriasis group now) in META. Until now, the access
campaign in the Philippines has largely excluded patient groups. Maybe it’s
because patients’ hands are already full coping with their condition and they
find tiring the endless discussions/arguments that we have. However, if we are
to have meaningful changes in the healthcare system, the voices of the patients
have to be given primacy. It is a real issue for them, life and death, not a
theoretical one as it is to some of us. Kaya James, saludo kami sa iyo. Yes,
kindly give the same passion you gave to Cancer Warriors to your advocacy for
Lolo and Lola. Sadly, many of us are either compromised or do not have the
courage to do that.
Hala, masyado nang mahaba itong email ko. Bottomline, I
agree with Nonoy that price control is not the answer. Competition is. The fact
that Pfizer is now in the generics arena through Rhea should be a cause for
celebration. Now, the LIPITOR and PONSTAN prescribers or users who are not
comfortable switching to existing generic brands will have the option of
switching to Rhea. Trust me, parehong-pareho sila. This is what competition is
all about.
-- Joey Ochave
Thanks Joey. I believe that majority of players and stakeholders in
the PH health sector never support or advocate price control or price
dictatorship. When the issue became sensationally hot in early to mid-2009,
there was never a "health crisis" or emergency, only a political
crisis for then Sen. Mar Roxas who was too desperate to raise his low ratings
as a Presidential candidate.
Re studies about the impact of price control, it is in
the law that the DOH should submit a report to Congress Oversight Committee on
RA 9502 at least once a year, and submit a report to the President two times a
year. I think this was never done by the DOH, or if ever it did so, those
reports were never made publicly available, freely downloadable.
Leonie Ocampo of PPhA, Reiner Gloor of PHAP then, Beau
Agana of PCPI, have made several presentations showing that (a) drug prices
have been declining even before the 2009 price control because of growing
competition among drug manufacturers and distributors, and (b) only the overall
revenues of affected innovator companies were affected but volume wise, their
sales have not significantly increased. Someone taking Norvasc 1 tablet a day
against hypertension does not take 2 tablets a day simply because the price is
cut by half. Ma-'undertension" na sya noon :-)
Price differentiation, market segmentation, is a natural
thing to do for private enterprises. The prices of a can of Coke in a sari sari
store, 7-11, Mini Stop, SM grocery, Rustan,s, Itallianis, Shangrila, Intercon,
etc., can vary widely. Same product, same volume, same packaging, same
manufacturer, and yet have different prices. Because they cater to different
buyers and consumers. The same practice applies to a bottle of C2 or a piece of
Toblerone.
A tablet of Norvasc or Biogesic can have different prices
in Mercury, Watsons, TGP, Aling Merced
drugstore, etc because they have different cost structures. Aling Merced and
other small drugstores rent a small space and pay little on space rental, have
no air-con and pay little on electricity, have no full time pharmacist and pay
smaller on manpower, etc.
