Poor countries pay up to 30 times more for medicines

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The world’s poorest countries are paying some of the highest drug prices, with everyday medicines costing up to 30 times more than in rich nations, according to a study.


The Washington-based Center for Global Development examined billions of dollars in spending by developing countries, concluding that low- and middle-income countries were paying 20 or 30 times more for medicines such as omeprazole, for heartburn, or paracetamol, a common pain reliever.


Pharmaceutical and healthcare markets “don’t work for the poorest countries, especially in South Asia and Africa”, said Kalipso Chalkidou, one of the report’s authors.


The study uncovered a stark disparity in the proportion of poorer countries’ use of unbranded generic drugs, usually the least expensive option.


In the poorest nations, branded generics — which command a price premium — make up about two-thirds of the market by volume and value. Unbranded generics are “a tiny sliver”, said the researchers, making up just 5 per cent of the market by volume and 3 per cent by value.


By contrast, in the US and the UK, unbranded quality-assured generics account for 85 per cent of the pharmaceutical market by volume, but only about a third by cost.


Nor was there much competition in the supply of essential medicines in low- and middle-income countries, the report said. These markets tended to be dominated by a single, or small number, of suppliers, directly affecting the prices paid by public bodies or consumers.


In some low- and middle-income countries, the largest seller of certain medicines “accounts for upwards of 85 per cent of all sales, such as contraceptives in Zambia, the Philippines, Senegal, and Kerala; cancer medicines in Zambia and Kerala; diabetes medicines in Zambia; and antiparasitics in the Philippines, Zambia, Tunisia, and South Africa”, the researchers found.

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Part of the solution, the researchers said, was for poorer nations to sharpen their procurement skills so as to get a better deal. Procurers often bought branded generics in the mistaken belief that they were of a higher quality than unbranded versions of the same medicines. Because regulatory systems were often weak, buying branded generics was one perceived method of screening out the fakes that flood much of the developing world.


“A concerted push is needed to professionalise procurement and broaden capacity from the global to national level,” researchers said.



In addition, said Ms Chalkidou, as countries became wealthier and donor money diminished, more of the total expenditure came from people’s own pockets, exacerbating inequalities. “If you’re buying as an individual you can’t get a good deal.”


Amanda Glassman, executive vice-president and senior fellow at the Center for Global Development, singled out the lack of competition in markets for essential medicines in African countries, saying there were clearly “high market-entry barriers, and this means high prices for both governments and consumers”.


Blaming “flawed drug-buying practices and broken generic markets”, she said: “We’re talking about access to common meds, not the latest cutting-edge cancer drugs.”


Ms Glassman added: “It’s not as exciting to talk about procurement as new health technologies or biotech breakthroughs. But drug purchasing is incredibly important, and if it’s done badly you end up with the poorest countries in the world paying some of the highest drug prices.” That undermined progress towards universal health coverage, she said.


The report was based in part on the deliberations of a working group consisting of policymakers, representatives from global health institutions and donors, procurement specialists, and academics.

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©Financial times

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