[e-drug] Rationale Behing Drug Pricing - Letter to Editor

["Zaheer-Ud-Din Babar" <horizon_pharm@yahoo.com>]

E-DRUG: Rationale Behing Drug Pricing - Letter to Editor
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Dawn 26th Feb, 2008
http://www.dawn.com/2008/02/26/letted.htm#2

This is in response to Dr Irfan Zafar's letter on
Feb 22 on drug prices in Dawn.

Since 2003, the World Health Organization and Health
Action International (WHO/ HAI) have developed a
standard methodology to measure drug prices in
developing countries. The methodology which was
developed by a global team of experts in medicine,
pharmacy, health economics, and pharmacology is now a
valid tool to evaluate drug prices (whether they are
high or low) in developing countries.

The method has been tested in more than 40 countries
and in Pakistan the survey was carried out by The
Network for Consumer Protection (An Islamabad Advocacy
Organization). The survey report on Pakistan is
available on HAI's website.

In this method, the medicine prices are measured by
comparing them with an international benchmark (called
International Reference Prices-IRPs).

The drug prices are compared with IRPs and an average
ratio is obtained (called Median price Ratio). If this
ratio is less than 1 in public sector (government
hospitals, clinics etc) and less than 2 in private
sector (private pharmacies, medical stores) then the
prices are considered reasonable. This is considered
while taking into account the production cost, profits
at supply chain, mark-ups etc.

In Pakistan, reports reveal that in the public sector,
prices of branded drugs (on average) are two times
while in the private sector more than 3 times higher
than the international reference prices. Certain
individual branded drugs are even higher.

For instance, branded acyclovir (an antiviral-11 times
higher), branded atenolol (for high blood pressure -
10 times higher), branded ciprofloaxicin (an
antibiotic- 26 times higher), branded diclofenac (a
pain killer- 15 times higher), branded fluoxetine (an
antidepressant- 21 times higher) and branded rantidine
(an antiulcer- 5 times higher).

So the question arises as to why the prices are again
increased in a hurry when some of the drugs are
already costly. This is indeed important in the
country when most of the expenditures on medicines are
unaffordable and not subsidized by the government.

It is time that the government formed rationale
medicine pricing policies (as in other countries) to
solve the issue.

However, effective reform requires political
commitment and such policies can only be developed if
government decisions are based on scientifically valid
data and pharmacists, doctors, health economists and
consumer representatives are included in the decision
process.

DR ZAHEER-UD-DIN BABAR 
Lecturer in Pharmacy Practice
School of Pharmacy
Faculty of Medical & Health Sciences
The University of Auckland
Private Mail Bag 92019
Auckland,New Zealand

Ph: +64 9 3737599 Ext 88436
Fax: +64 9 367 7192
Ph: (Mobile) + 64 211241013
E-mail: z.babar@auckland.ac.nz