UHC 18: DOH Budget, Healthcare Deregulation and PharmaWealth

After I posted UHC 17: First, Second and Third Lines of UHC for the Poor in the Advisory Council loop last week, July 30, DOH USec Madz replied that DOH budget is presented as DOH proper which is smaller and DON family which is bigger because it includes the fund of National Nutrition Council, PoPCoM, corporate hospitals PHC,Lung Center and NKTI.

Leonie Ocampo of PPhA also replied,

Thanks Nonoy. I know it is not easy to be done, but if we want to be serious in looking after the health especially of the poor who can not afford to buy their medicines, ways to ensure they get the right medicines (quality, safety and efficacy assured) must be done. As I write this comment I know someone is dying because of;  

1. medicines taken are not the right medicines for the condition, in short NOT the best choice for the condition but given because it is what is available. 

2. medicines taken maybe are what are needed as determined by the doctor but the quality is questionable; counterfeit, substandard, fake, spurious and falsified but purchased by LGU or a government agency because they are the cheapest. ( price is not only the consideration in buying medicines anyway) 

3. medicines are right and chosen right but not used right because of lack, no or misinformation  given to the patient and . . .  many more reasons.  

RESULT : GAP between the clinically-tested effects of the medicines and the actual effects when used by the patient happen. Is this not a GOOD WASTAGE of the people's money?This is why the PPhA and I am supporting the DOH to really put its IRON HANDS on this.

I thanked USec Madz for her reply. I checked the DBM’s Budget of Expenditures and Sources of Financing (BESF) 2014, and here’s what I got.

Source: http://www.dbm.gov.ph/wp-content/uploads/BESF/BESF2014/B12.pdf

So DOH’s regular plus special purpose funds was P51.05 billion in 2012, much larger than other DOH presentation saying they only have P42 billion last year. The infusion of P14 billion for PhilHealth last year, or one year before the elections this year, explained such huge jump in 2012 budget.

The combined regular fund + special purpose funds this year is P52.56 billion and P82.77 billion next year, or an increase of P30 billion over this year’s budget. That increase is huge, larger than the regular budget of the DENR (P23.7 billion this year and P23.91 billion next year) or DOJ (P10.9 billion this year and P11.6 billion next year).

The deregulation of health insurance that I mentioned in my earlier paper refers to allowing people to have health insurance  but it does not mean that it should be PhilHealth only. People, especially those in the formal sector, should have the freedom and choice to opt out or not contribute to PhilHealth if they wish to, so long as they get another health insurance provider – an NGO or corporate HMO, an LGU, a private health foundation, and so on..

I also thanked Leonie as her perspective as a pharmacist can inject new perspective, a wake up call for many sectors who only focus on "cheaper medicines" as the single most important consideration in incorporating government medicine procurement with UHC policy.

Also last week, July 29, I attended a forum on "Designing Competition Reforms in Developing Countries" at the Phil. Institute for Development Studies (PIDS), Makati. DOJ Assistant Secretary and a friend, Geronimo "Indian" Sy mentioned in his presentation that a local pharma owned by a Congressman is able to supply medicines to many government hospitals and there might be anti-competition acts there.

He did not stay long after his talk though. I spoke during the open forum and supplied the "missing info" referred to by ASec Sy. I said that it's PharmaWealth owned by the family of former Cong. Ferjenel Biron. I added that an anti-competition act is possible because as a Congressman approving, raising or reducing the budget of government hospitals and other agencies, the legislator has the advantage in "winning" a medicine supply contract with many DOH hospitals. I saw the data presented during a UHC forum at the AIM the week before that.  PharmaWealth can supply amlodipine 10mg for only P0.35 a tablet to some government hospitals, and sell at P2+ or P3+ per tablet to other government hospitals. 

UHC 17: First, Second and Third Lines of UHC for the Poor

Later today, I will attend a round table discussion on Health System Shapers (HSS), Patients and Consumers Sector, at the Department of Health (DOH) main office. The goal of this and related fora is to further fine tune the government’s universal health care (UHC) goal.

Last week, I also attended the two-days (July 25-26) “Policy Dialogue on UHC and Access to Medicines “ held at the Asian Institute of Management (AIM) in Makati. Here are two of the definitions or presentations about UHC.

This one is from DOH UnderSec. Madeleine “Madz” de Rosas Valera in her presentation, “The Philippine Response to Universal Healthcare and Access to Medicines 2013”. She added that UHC is one of four major social investments of the government to help the poor. The other three are public education, housing and conditional cash transfer (CCT).

And this one is from Dr. David Lee of Management Science for Health (MSH) in his presentation in the same forum last week, entitled “Medicines as Part of Universal Health Coverage: The Global Dialogue”

Pondering on UHC, I think the health sector already has among the monster budget in the country today. Consider the following:

1. Proposed DOH budget for 2014, P80.2 billion, from P50.5 B* this year and P34.0 B in 2012

http://www.dbm.gov.ph/wp-content/uploads/NEP2014/XIII/DOH.pdf

2. projected PhilHealth revenue 2014, about P80 B, from about P62 B this year and P47 B in 2012. (Revenues almost equal Benefits payment per year)

3. PGH budget, P2+ B, from P2 B this year

4. AFP hospital, P1.5 (?) B, from P1.3 B this year

5. PNP hospital, Veterans hospital, etc.

6. Other state universities' hospitals

7. PCSO, PAGCOR, SSS, GSIS, etc. health spending

9. Provincial, District, City, Municipal hospitals **

10. Provincial, City, Municipal, Barangay health centers

11. WHO, WB, ADB, UN agencies, multilateral grants

12. USAID, JICA, KOICA, CIDA, EU, etc. bilateral grants

* I saw the DOH presentation last year for its 2013 budget, they were spending on a P42B approved budget, now it has been revised to P34 B? What happened to the P8 B? Can an approved budget still be slashed? Weird… will ask around why.

** Total number as of 2013: (a) DOH hospitals 60, (b) LGU hospitals 584,

(c) Rural health units (RHUS) 1,285, and (d) Barangay health stations (BHS) 962. The nearly 600 LGU hospitals alone, I think they will have at least P50 billion budget next year.

Should be P300+ B next year alone? And that’s for government spending alone.

I am wondering if there was any study conducted by the UHC study group (UP Manila), Health Policy Development Program (HPDP, UPSE + UP Manila + other colleges?) or other groups, detailing how much really is spent by the public sector alone yearly, on healthcare?

It seems none, except that every year, there is belief that there is  "not enough money, give more money, raise more money, to public health."

Meanwhile, there are various private and civil society spending on health charities. PHAP Foundation gives about P100+ M a year , Unilab another P100M? other PCPI-affiliated pharma. Zuellig Foundation, Rotary Foundation, GMA Kapuso foundation, ABS-CBN foundation, St. Lukes Foundation, MMC Foundation, etc.

I think ALL foundations and private charity organization have health spending in one way or another. Plus extra spending during calamities, like individuals donating money or medical products and devices.

So we are talking of possibly P500+ billion health spending in one year alone?

And many people still think that health spending is still "not enough". hmmmm...

The first line of UHC for the poor are the RHUs, BHS, and LGU hospitals. The second line will be the DOH hospitals, Philippine General Hospital (PGH), other state universities’ hospitals, AFP hospital, other departments’ health facilities. Plus the charity emergency/wards of private hospitals. That is for outpatient services (have fever, or headache, stomach ache, then go home after consultation) and wards in case of confinement.

PhilHealth should be considered as a third line in UHC of the poor. Yet PhilHealth is the main discussion point when people talk about UHC.

PhilHealth is NOT a healthcare provider, unlike those RHUs, BHS, LGU hospitals. PhilHealth is only a health financier, for those who are hospitalized, and assuming that they were not technically disqualified, say they forgot to pay the premium last month or a few months back. Or they are unmarried couple.

So the focus on expanding PhilHealth coverage may be a secondary consideration compared to improving the healthcare delivery of those RHUs, BHSs and LGU hospitals.

As an advocate of minimal government involvement, in healthcare in this case, I maintain that PhilHealth membership should not be made mandatory and obligatory for all people. What should be made mandatory is that all people, children especially, should have health insurance – whether from private charity organizations and foundations, or private HMOs, or some health NGOs, or LGU schemes and hospitals, or from PhilHealth.

UHC 16: Dialogue on UHC and Medicine Access, AIM July 25-26

The Department of Health (DOH), Philippine Health Insurance Corporation (PHIC or PhilHealth), FDA and the AIM Dr. Stephen Zuellig Center for Asian Business Transformation (AIM ZCABT) will hold a policy dialogue tomorrow and on Friday, on “Universal Health Care and Access to Medicine” at the Asian Institute of Management (AIM), Makati City.

I received the invite only today when the DOH National Center for Pharmaceutical Access and Management (NCPAM) extended the invite to all members of the DOH Advisory Council for the Implementation of RA 9502 (Cheaper Medicines Law of 2008). Thanks to Mhyanne Dioso, the chief “workhose” of NCPAM for the Advisory Council, aside from NCPAM Director, Doc Virgie Ala.

The main objective of the seminar is “to identify the gaps and solutions in ensuring universal access to medicines in the Philippines” and hence, contribute to attaining universal health care (UHC) or Kalusugan Pangkalahatan.

The DOH’s budget has been rising big time in recent years: from only P18.9 billion in 2008, marginally rising to P23.7 billion in 2009 and P24.6 billion in 2010. When the PNoy Aquino government came, the DOH budget jumped to P31.8 billion in 2011, P42.1 billion in 2012, to P52 billion this year. Next year, the DBM-approved budget that was sent to Congress is P87 billion, or a P35 billion jump over this year’s budget.

A big portion of such huge jump in the proposed spending next year will be used to cover more poor households in PhilHealth insurance system, as the President said in his State of the Nation Address (SONA) last Monday. And medicine procurement by DOH hospitals and other agencies will likely get a big boost too.

Please note that public health spending in this country does not only come from the DOH. There are also the LGUs through their provincial, city and district hospitals, provincial and city/municipal/barangay health centers. Then other government agencies like the AFP Hospital, Veterans (under the DND) hospital, PNP Hospital, UP-PGH, PCSO ambulances and health charities, and so on. And almost all departments and agencies have their own in-house clinics for the healthcare of their employees and their dependents. There is huge public spending in healthcare and many people do not realize it, so they ask for more subsidies through the DOH and PhilHealth.

Back to the forum tomorrow. Among the speakers will be DOH Secretary Enrique T. Ona, DOH UnderSec. Madeleine “Madz” Valera, PhilHealth President and CEO Alexander “Alex” Padilla, FDA Dir.- General Kenneth Hartigan-Go, and Mr. Deejay Sanqui of IMS Health.

I hope that Sec. Ona will give an overview of the big DOH budget next year seeking approval by Congress. It seems that the “creeping re-centralization” of healthcare is no longer creeping but already hopping. Healthcare is among those functions by the national government that were devolved and decentralized to the LGUs under the Local Government Code of 1991.

I also hope that PhilHealth President Alex will not announce another round of hike in annual premium, especially for those in the formal sector. PhilHealth hiked plans to hike the premium from 2.5 to 3.0 percent of the basic salary of those working in the formal sector just a few years ago. The premium of OFWs has been raised from P900 to P1,200 per year and the sponsored program, the poor, from P1,200 to P2,400 per year, but the poor do not pay this amount, the LGUs and/or the DOH do.

My advocacy for minimal government in healthcare does not include healthcare for pediatric diseases and infectious diseases for both children and adults. I support further DOH and LGUs spending for these two types of diseases. But I do not support more government subsidy for NCDs for adults. If people have money to buy lots of fatty/salty food and drinks, lots of alcohol and tobacco products, or nice flat tv and DVD players and become couched potatoes, and they become sickly later, they should also have the money to buy private health insurance to augment their PhilHealth insurance. To say that they have no money for their own healthcare while they can spend for those food, drinks and smoking, is simply “palusot” and must be checked.

PhilHealth I think, should prioritize issuing automatic membership card for all poor children, say 6 years old and below. If DOH and LGU resources cannot support automatic coverage for older children and parents from poor households, then other agencies like DSWD, PCSO, UP PGH, private charities and foundations can come in. But usually LGU hospitals provide universal coverage for their local residents, young and old alike.

Tomorrow afternoon panel discussion will be on “Innovating and Improving Access to Medicine via Good Governance” with Tarlac Gov. Victor Yap, Gov. Alfonso B. Umali, Jr. of ULAP, Ms. Esther Go of Medilink, and Dr. Peter Glen Chua of FDA as speakers.

The role of LGUs is important in this aspect as lots of waste if not corruption in medicine procurement and distribution happen at the LGUs level. Many LGUs do not have the proper training and expertise in the proper storage and dispensation of medicines given free to their local residents.  

On Day 2, July 26, there will be a panel discussion on “4Ps of Financing Pharmaceuticals”: Rational Pricing, Tailored Procurement, Strategic Purchasing, and Risk Pooling, with four speakers:

Dr. Melissa Guerrero of DOH-NCPAM, Mr. Bienvenido Bautista of PITC Pharma, Inc., Dr. Dennis Ross-Degnan of Harvard Medical School, and Dir. Carlos Da Silva of AHMOPI.

NCPAM has a big budget for medicine procurement for “drugs entitlement” on certain diseases like breast cancer. PITC Pharma is the state’s chief drug importer and wholesaler for the various DOH-sponsored Botika ng Bayan, Botika ng Barangay, and other DOH agencies.

I am curious about the lectures on various topics like the ASEAN Pharma Harmonization, Anti-Microbial Resistance (AMR), Drug Price Referencing, PPP to Improve Access to Medicine, and PHIC and PCB 2. The  speakers will be Ms. Joyce Cirunay of FDA, Dir. Virginia Ala of DOH-NCPAM, Mr. Alex Haasis of NCPAM, Dr. Anthony Faraon of Improving Access to Medicine Project, and Dr. Francisco Soria of PHIC.

We shall have an ASEAN Economic Community (AEC) in 2015 or less than two years from now. The ASEAN Free Trade Area (AFTA) will mature, meaning zero tariff for all imports from any ASEAN member-countries, except perhaps for poorer economies Myanmar, Cambodia and Laos who might slap import tariff on some imported products from other ASEAN countries.

Singapore is the regional headquarter of many innovator pharma companies, not only because it is a regional financial center at par with Hong Kong, but also it strictly respects IPR like patent and trademark. Thus, IPR-busting policies like compulsory licensing of new and patented medicines, and drug price control are not done there. An ASEAN harmonization plan will consider this disparity in IPR and drug pricing policy. Many ASEAN countries like the Philippines, Thailand, Indonesia, Malaysia and Vietnam have laws allowing CL or similar schemes, and drug price control policy. Singapore does not have such policies.

Another learning experience for me in the next two days in health economics and public policy.

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See also:

Socialized Healthcare 12: Nurses, Doctors and Other Resources, March 03, 2013

Socialized Healthcare 13: On Inequality and Inclusive Business in HC, March 19, 2012  

Socialized Healthcare 14: Over-extending Government Role in Health, May 22, 2013 

UHC 15: On DOH Plan to Recentralize Healthcare, June 27, 2013

Senior Citizens Discount 3: Sharing of Mandatory Discounts on Medicines of Senior Citizens

Republic Act (RA) 9994 or the Expanded Senior Citizens Act of 2010 provides for these new benefits to resident citizens of the Philippines who are 60 years old and above:

"SEC. 4. Privileges for the Senior Citizens. -

The senior citizens shall be entitled to the following:

"(a) the grant of twenty percent (20%) discount and exemption from the value -added tax (VAT), if applicable, on the sale of the following goods and services from all establishments, for the exclusive use and enjoyment or availment of the senior citizen

"(1) on the purchase of medicines, including the purchase of influenza and pnuemococcal vaccines, and such other essential medical supplies, accessories and equipment to be determined by the Department of Health (DOH).

"The DOH shall establish guidelines and mechanism of compulsory rebates in the sharing of burden of discounts among retailers, manufacturers and distributors, taking into consideration their respective margins;

"(2) on the professional fees of attending physician/s in all private hospitals, medical facilities, outpatient clinics and home health care services;

"(3) on the professional fees of licensed professional health providing home health care services as endorsed by private hospitals or employed through home health care employment agencies;

"(4) on medical and dental services, diagnostic and laboratory fees in all private hospitals, medical facilities, outpatient clinics, and home health care services, in accordance with the rules and regulations to be issued by the DOH, in coordination with the Philippine Health Insurance Corporation (PhilHealth);...

While there is not much confusion or conflict in the discounts in professional fees of healthcare professionals, there is confusion and even conflict among the various players in the medicines sub-sector, in particular among drug manufacturers, distributors, importers/exporters, wholesalers, retailers, and hospital pharmacies.

The Department of Health (DOH) has requested members of the Advisory Council (AC) on the Implementation of RA 9502 (Cheaper Medicines Law of 2008) for their comments of the draft DOH Circular that will soon be issued by the DOH Secretary. Below is my letter to them which I sent by email yesterday.
-----------

12 December 2012

Dr. Madeleine de Rosas-Valera

Chair, Advisory Council for RA 9502

Assistant Secretary

Department of Health

Dear Doc Madz,

Here are our comments to the draft Department Circular, “Clarification on Certain Provisions of Administrative Order No. 2010-0032” regarding RA 9994 or the Expanded Senior Citizens Act of 2010.

1. Definitions of Wholesaler, Retailer, Distributor, Manufacturer and so on, we agree with the definitions given.

2. On the sharing of the 20 percent mandatory discount to senior citizens, the 30-70 percent burden sharing to retailers-manufacturer/distributor/wholesaler looks fair.

It is assumed that whatever burden sharing should apply after the new Department Circular has been issued and not apply retroactively.

As an outside observer and not part of the major players – the drug manufacturers, distributors, retailers and so on – it is pathetic to see how these players were forced to debate among themselves who should get the bigger burden while government burden in the form of tax credits or loss carry over is not clear. Each of these players is doing its share in giving patients and consumers have access to quality and affordable medicines. That alone is an important social function or public service already..

An enterprise that is forced and coerced by the government to give discounts to certain group of consumers will attempt to survive and not go bankrupt. There are many ways to do this.

One is to stop selling those medicines and products that are highly demanded by the senior citizens. This is happening already in some small and independent drugstores in rural areas which have little leeway for further price discounts as they do not have the economies of scale. 

Two, raise further the regular price of those medicines demanded by the senior citizens so that after the 20 percent mandatory discount, the price simply goes back to its original level and thus, not suffer a loss.

Three, raise the price of other medicines and products demanded by the non-senior citizens. In effect they subsidize the price discount given to the senior citizens. This situation can be illustrated by this graph.

If there was no price distortion like RA 9994, the “equilibrium price” (P*) of a particular medicine will be at point A, With the law, the new price with mandatory discount (Pmd) will be at point B, lower or cheaper than point A. In order to prevent losses, an enterprise (retailer, wholesaler, manufacturer, etc.) will hike the price (Ph) of  medicines to point C. So a 20 percent discount at point C will only bring back the original price at point A while giving the illusion to patients that they are buying at point B. Or senior citizens pay at point B while non-senior citizens suffer even higher prices at point C.

The only way to correct this injustice is to scrap that law, but since this is impossible at the moment, let this situation serve as additional lesson, that government price regulations and forcible, mandatory price discount, produce more harm than good.

Thank you very much.

Sincerely yours,

Bienvenido “Nonoy” Oplas, Jr.

President

Minimal Government Thinkers, Inc.

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See also:
On Senior Citizens Discount, August 10, 2009 
Senior Citizens Discount, Part 2, November 03, 2010 
Drug price control 5: Mandatory discounts and acronym politics, March 21, 2011

Welfarism 23: Letter to Sens. Cayetano and Pangilinan on Solo Parents Welfare, October 23, 2012

Socialized Healthcare 7: Degnan and Wagner on ICIUM and UHC

Healthcare is a very important issue for many people around the planet. That is why emotional arguments are often linked with quantitative and political discourses. The belief or motto that "health is a right and an entitlement from the state" often clouds if not erases the other side of the equation that health is also a personal and parental/guardian/civil society responsibility.

Yesterday, I attended a seminar at the Asian Institute of Management (AIM) by two eminent speakers from Harvard Medical School (HMS) and World Health Organization (WHO) consultants.

Dr. Ross-Degnan, Sc.D. (left photo), an Associate Professor at the Department of Ambulatory Care and Prevention (DACP) at HMS and Director of Research at Harvard Pilgrim Health Care, spoke on Improving Medicines Access and Use: Highlights from the International Conference on

Improving Use of Medicines (ICIUM 2011).

Dr. DegNan co-founded the International Network for Rational Use of Drugs (INRUD) in 1990, a global network of academics, health managers, and policymakers involved in developing and testing interdisciplinary interventions to improve use of medicines. He is a consultant at the WHO on issues related to access to and appropriate use of medicines, and pharmaceutical sector monitoring and evaluation. 

The second speaker was Dr. Anita Wagner (above, right photo), an Assistant Professor in the Department of Ambulatory Care and Prevention (DACP) at HMS and Harvard Pilgrim Health Care. She has a doctorate in epidemiology from Harvard School of Public Health and a doctorate in clinical pharmacy from the Massachusetts College of Pharmacy and Allied Health Sciences. For the WHO Collaborating Center in Pharmaceutical Policy, she leads the global Medicines and Insurance Coverage (MedIC) Initiative. Yesterday, she spoke on Universal Coverage and Medicines: Why Focus on Value?

A staff of Dr. Kenneth Hartigan-Go of AIM, David Teh, sent me the powerpoints today. Thanks David. Dr. Degnan's presentation is about 30 slides, I will show only about half of them below.

Improving use of medicines (IUM) I think is the other term for rational use of medicines (RUM). The latter is used here by the DOH and even by WHO Philippine Office. Right, even if medicines are heavily subsidized by the government, or even freely available, a patient should not over-dose or over-extend taking the medicines simply because they are cheap or free. There are serious long term adverse effects like anti-microbial resistance (AMR) where the body or a disease has gotten used to certain medicines and treatment and simply multiply or evolve into more dangerous diseases even if the patient is taking the necessary medications. The chart on supply and demand of medicines by Dr. Degnan is nice. I think it's simple enough.

Dr. Degnan gave a background about the ICIUM, it holds the conference every seven years. So the next conference would be sometime in 2018. And from 2003 to 2007, there was marginal improvement in policies and implementation of countries to improve use of medicines.

Below are the series of recommendations for each sector or stakeholder. I like the one mentioning the role of think tanks. We don't have much of such stuff here in the Philippines. We instead have dozens or hundreds of advocacy NGOs and people's organizations and cooperatives with definite positions on certain issues that are often not refined or updated with the changing times.

Then I like the mention or emphasis on multi-stakeholder collaboration, the unintended adverse effects of government intervention in pricing of medicines, like the current drug price control and mandatory 20 percent discount to senior citizens and persons with disabilities (PWDs).

Drug Price Control 29: MRP Attempt Over Anti-Leptospirosis Drug

Today, the drug price regulation or control policy in the Philippines is exactly three years old. It was implemented August 16, 2009. No cake nor cigar for this wrong policy.

Yesterday, I attended an emergency meeting of the Advisory Council for RA 9502 (Cheaper Medicines Law) at the DOH. There were some proposals to impose a maximum retail price (MRP) on doxycycline, a drug against leptospirosis, a common disease during heavy flooding that submerge thousands of houses for hours or even days.

Here is the background as I gathered during the meeting and in small talk after. During typhoon Ondoy (see  Climate stupidity 18: Warming causes more storms and less storms, Typhoon Ondoy Photos) three years ago, and in other severe flooding after that, several people died due to leptospirosis, an infectious disease coming from animals, especially rats' urine that mix up with dirty water and enter the human body via the mucous or wound or infected drinking water.

Once untreated, the virus can cause first flu-like symptoms (fever, chills, headache, etc.) later on meningitis, damage of the liver or other internal organs, and later, can result in death. The DOH was peppered with questions if not blame, during the leptospirosis outbreak then. So this time, before any outbreak would show, the DOH wanted to be ready.

So during the heavy flooding last week caused by southwest monsoon or "Habagat", then another heavy flooding early this week due to typhoon Kai-tak (local name "Helen"), many people tried to stock up on doxycycline as a precaution. A friend of President Aquino was said to have complained to him why the price of the drug was high, more than P50 or even more than P70 a tablet, when it should be cheap. The President asked the DOH about it.

Then the Director of DOH NCPAM, Dir. Virginia Ala herself got a call from a physician in Marikina, a city that often gets heavily flooded, why the price of doxycycline in Mercury Drugstore was more than P50 when it should be around P10 only. People began to wonder if there was a sudden jack up in the price of doxycycline from around P10 to P50+ or P70+, or even P160+. If that was so, some people suggested to put the drug under price control or MRP.

The DOH wanted to explore other proposals aside from imposing a new round of MRP, hence the need for that emergency meeting. Well, I got the notice of meeting only one day before the meeting, that's how urgent the meeting was for the DOH. I admire the DOH, especially Assistant Sec. (ASec) Madeleine "Madz" Valera for her trust in the inputs of members of the Advisory Council, as well as the consensual nature of the Council.

The meeting was initially chaired by former DTI UnderSec. and now PITC President, Ma. Lourdes Baua. DTI is the co-chair of DOH in the Advisory Council. PITC is an attached agency of the DTI. Then ASec Madz came to preside as Ms. Baua went to another meeting. She just came from a meeting with DOH Sec. Enrique Ona, and was later called out again for another meeting with the Secretary.

I noted during the meeting that the date was rather good as it was (almost) the 3rd year anniversary of MRP implementation. Dr. Rustico Jimenez, the President of the Private Hospitals Association of the Philippines, Inc. (PHAPI) noted that it was the DOH or other government agencies themselves that alarmed the public about leptospirosis and hence, alarmed the need for doxycycline. In his observation, more people died of pneumonia, gastro enteritis, other diseases during and after flooding than lepto. ASec Madz said that it might be true, but many people are at risk of lepto due to the rather high number of casualty from the disease in previous flooding.

There were several suggestions that came out on what the DOH should do to limit public alarm over lepto and other water-borne diseases. The DOH observed that many individuals and civil society groups were distributing medicines to flood victims especially in evacuation centers. The DOH suggested that since non-rational use of medicines (RUM) is becoming common, like not all people can take a particular medicine for a specific disease, medicines donation should as much as possible be coursed through its central office, its provincial offices and attached hospitals.

I suggested during the meeting that since many people would give their donations to civil society and charity organizations than to government, call it distrust of government in one way or another, medicines donation should be done with the presence of health professionals for proper dispensing to patients. Doxycycline for instance should not be given to pregnant women and children, especially those below eight years old.

Reiner Gloor suggested that in times of emergencies, if it is possible that drugstores can give the doxycycline and PhilHealth will reimburse later. I don't remember what the guy from PhiliHealth said in reaction to this. But  for members who are qualified for the out-patient benefit package, I think this is possible and a good proposal. If a member is kept out of hospital, takes medication and recovers at home, PhilHealth spending will be lower and hence, it will benefit.

One good outcome of the meeting was that no one suggested that doxycycline be put under MRP. No one suggested to expand drug price control policy. Here's one reason, from some of the materials distributed during the meeting.

Doxycycline, Pesos per 100 mg capsule, Muntinlupa:

Brand Name	Drugstore Name	Price
1. Vibramycin	Watsons Mercury	169.75 168.75
2. Doxin	Asian Hospital Medical Center Muntinlupa Watsons, Mercury, South Star, Rose	145.25 103.62   74.25
3. Doxicon	Rose Pharmacy Shopwise Pharmacy Watsons	58.10   56.00   49.25
4. Dyna-doxicycline	Mercury, South Star	53.00
5. Drugmakers	Middle Town	5.00
6. Mydoxy	The Generics Pharmacy	2.00

source: DOH.

So if people will suggest imposing drug price control, they would most likely be targeting Vibramycin. But why would people insist on vibramycin with its almost P170 price per capsule, when other brands at a much lower price, P49 or P5 or even P2 are available. Although I think that the P2 drug would have been snapped up by some hoarders, to be sold at a higher price via black market in still submerged towns and villages in Laguna or Cavite, Bulacan, Pampanga, Bataan, etc.

A note on groups that oppose and support the MRP policy...
As far as I can recall in previous Advisory Council meetings, those who are explicitly against government drug price regulation or control are:

1. PCPI, Philippine Chamber of Pharmaceutical Industry, local generic manufacturers and distributors, drugstores,
2. PHAP, Pharmaceutical and Healthcare Association of the Pilippines, mostly multinational innovator companies, big drugstore chains like Mercury,
3. PPhA, Philippine Pharmacists Association,
4. PHAPI, Priv. Hospitals Association of the Philippines, Inc.
5. DSAP, Drug Store Association of the Philippines, small and non-chain pharmacies and drugstores,
6. AGAP, Ayos na Gamot sa Abot-kayang Presyo coaltion
7. MGT, Minimal Government Thinkers.

Those with soft or implicit opposition are
8. PMA, Philippine Medical Assocation,
9. Mercury, Watsons, The Generics
10. MeTA, Medicines Transparency Alliance, Philippines.

Those who explicitly support price control
1. CWF, Cancer Warriors Foundation.

Those who have no explicit position but only follow their mother agencies:
1. PITC Pharma, DTI
2. PhilHealth, DOH
3. FDA, DOH
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See also:
Drug Price Control 23: Greece's Pharmacy Nightmares, January 13, 2011
Drug Price Control 24: Forcing Drug Firms to Report Payment to Doctors, January 24, 2012
Drug Price Control 25: Top 10 Articles on Google Search, April 03, 2012
Drug Price Control 26: Conflict of Interest in Drug Price Regulation Legislation, May 13, 2012
Drug Price Control 27: Letter to Sen. Pia Cayetano, May 15, 2012
Drug Price Control 28: On Cong. Biron and Sen. Villar Bills, July 14, 2012

RUM 7: Leptospirosis and Doxycycline, August 12, 2012
Warming Hysteria: Typhoon Ondoy Flooding, September 28, 2009

Health Transparency 8: Advisory Council on RA 9502

Last week, June 06, the first meeting for this year of the DOH Advisory Council on Healthcare was held. It was chaired by Assistant Secretary (ASec) Madeleine "Madz" de Rosas-Valera. It was among the liveliest meetings of the Council that I have attended since the Council was formed in 2009.

There were four topics and issues that were discussed and resolved that day:

1. Senior Citizens' discount (SCD), RA 9994, distribution of private sector burden since the government through the BIR assumed zero burden on this.

2. Electronic Drug Price Monitoring System (EDPMS), among the provisions of RA 9502 or the Cheaper Medicines Law of 2008 started in February 2006 under AO 2006-0009.

3. Status of implementation of the FDA Act of 2009 or RA 9711.

4. Proposed amendments to RA 9502 creating the Drug Price Regulations Board (DPRB).

Dr. Madz is a vocal, frank and good-humored person. I really liked the way she chaired the meeting. And the DOH, despite its limitations, still offers a more open venue for real discussions and dialogues among various stakeholders on health issues, compared to Congress, both the lower and upper houses. I have argued in my earlier papers here, that there is a tendency of bullying by some legislators during Congressional Committee hearing.

On the expanded senior citizens discount (20 percent off on medicine prices, medical devices, hospitalization and other fees), the problems simply refuse to go away. Or more appropriately, the problems created were larger and plentier than the solutions they are supposed to provide in bringing down the prices of medicines and other healthcare goods and services.

Why? Of the 20 percent mandatory discounts given to senior citizens, 30 percent is supposed to be shouldered by the government through the BIR, in the form of tax credits by retailers, wholesalers and drug manufacturers, the 70 percent to be distributed among these private players. But this is not happening as the BIR refuses to recognize the discount as tax credit. So the retailers and manufacturers, plus wholesalers, are pointing at each other sometimes of who should shoulder the bulk of the burden.

If the retailers get 16 percent or higher discount from manufacturers (like Mercury drugstore chain), 100 percent or the entire 20 percent SCD should be shouldered by the retailers. If the retailers get lower than 16 percent drug suppliers' trade discount, the suppliers will assume the entire burden.

So the government regulates and taxes the private players, then forces them also to provide mandatory discounts at zero financial burden to the government, and the public think that it is the government that gives the discount. This is deception.

What many private small drugstores and pharmacies do, is they do not carry or sell certain medicines and medical devices that are frequently demanded by the senior citizens, in order to avoid or at least limit the losses. Supposedly cheap but not available medicines, this is happening in certain areas of the country.

On the EDPMS, NCPAM mentioned that the recent DOH Administrative Order mandating the monthly updating of drug prices data by drugstores and pharmacies  to the DOH, imposing penalties for violation, has been released  Ms. Leonila "Leonie" Ocampo, President of the Philippine Pharmacists Association (PPhA), and Ted Colorado from the Drug Store Association of the Philippines (DSAP) explained why EDPMS is not working as designed and only created more problems and jacked up the operating costs of retailers. Leonie cited that they go around the country every week to conduct various seminars to Filipino pharmacists and the problem of EDPMS, the difficulty in complying with it, ranging from technical problems in uploading the data, to system inconsistencies with the DOH server, would always crop up.

Ted mentioned that he experienced facing the computer the whole evening up to early morning the next day and he was able to upload the prices of only five drugs out of several products they sell. I think the sheer volume of data from more than 22,000 drugstores nationwide being uploaded to the DOH would be enough reason to clog the DOH server and cause slow connections.

Madz said this is another example of "baking a cake that we cannot swallow", of having regulations that are difficult to implement. Yeah, that's why I said above that Madz is a frank and good humored person. Even if those being regulated want to comply with those regulations, they simply encounter various technical problems, not to mention diverting manpower away from the pharmacy and advicing patients, to the computer trying to upload data that would hardly go through the system.

There was one good resolution from members of the council who were there -- that they will ask the DOH  Secretary to have a moratorium on the implementation of complying with EDPMS pending further studies how to make the process easier to comply with, until end-2012 temporarily.

On FDA law implementation, the submission of a business plan to the DBM was briefly discussed.

On DPRB bill by Cong. Ferjenel Biron, Sen. Manny Villar and others, Dr. Madz said she is preparing an official position paper by the DOH on the subject. Generally, they are not in favor of creating the DPRB, they recognize that price control and regulation should be a "last resort" measure to further bring down medicine prices.

I briefly spoke on DPRB, I said that only one legislator is so gung-ho in creating this new bureaucracy, Cong. Biron and I think that he foresees himself to head this agency once it becomes a law. Given the conflict of interest of Cong. Biron -- he and his family own PharmaWealth, a drug importer and supplier, and Botikang Pinoy, a drugstore, it does not look good that the regulator is also a player, enjoying certain privileges that other drug manufacturers and pharmacies do not enjoy. I believe there is bad if not evil intentions in pushing hard that provision of institutionalizing price control as a policy and creating a permanent bureaucracy that will implement a bad policy.

Among the other agreements that afternoon, aside from (a) having a moratorium on EDPMS are:

b) change the name of the Advisory Council (AC) from AC on Healthcare to AC for RA 9502 implementation.
c) rationalize -- trim down, expand some -- the members of the AC
d) creation of a technical working group to further study the processes and implementation of EDPMS
e) the AC will meet quarterly or four times a year.

Meanwhile, google "drug price control" and here's one surprising result....

Seven of the top 10 articles on page 1 of google search are my papers: two from www.thelobbyist.biz, four from this blog, and one from www.interaksyon.com. :-)
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See also:
Health Transparency 4: Drug Promotions and Government, September 03, 2010
Health Transparency 5: Forum on Good Governance in Health, March 08, 2012
Health Transparency 6: Physician Protectionism, May 19, 2012
Health Transparency 7: DOH Advisory Council, CHAT, June 04, 2012