PHAP warns against drug price distortion

MANILA, Philippines — Morphine will become cheap and prone to abuse if the government’s drug price control formula is implemented, the Pharmaceutical and Healthcare Association of the Philippines (PHAP) warned yesterday.

PHAP executive director Teodoro Padilla said the proposed drug price control formula of the Department of Health (DOH) will likely lead to a distortion in the prices of medicines.

Padilla said the proposal would make morphine and other painkiller opioids cheaper than paracetamol and make them easily accessible to the public or even prone to abuse.

“The price distortion stems from the formula that sets very low prices at the manufacturing level and yet mandates retailers to impose up to as much as 45 percent mark up, which, at present, generally does not reach the level, particularly with most outlets,” Padilla explained.

He added: “The proposed scheme would lead to either a price freeze or even higher drug prices at the patient level.”

He also believes that such a move could force drug retailers to close shop,  an event that would lead to a shortage of medicines.

The PHAP head said there are instances in which the scheme yields higher prices such as in the case of a drug for hypertension, which is sold at P44.70 but may go up to P52.42.

A diabetes drug available at P32.14 could increase by 29 percent to P41.32 apiece, he said.

“These are just few examples. It remains uncertain whether the DOH considered costs of doing business in the country. Our concern is that since we cannot sell at a loss, the country will have to import, which could be costlier,” Padilla said.

He said some of the drug manufacturers may also pull out their operations from the Philippines because of the price control formula.

The PHAP stand is that price control does not work. It will only lead to market inefficiencies, said Padilla.

The local pharmaceutical industry, he said, is being wrongly accused of profiting when the truth is that they sell medicines at lower prices to the government on bulk basis.

He said a tablet of hypertension medicine sells for as low as P19 centavos and diabetes drug for P56 centavos in government hospitals compared with P34.50 and P16 for the same drugs at retail outlets, respectively.

The proposed implementation of the price ceiling, he said, also has legal infirmities.

PHAP is offering a 75 percent discount for 150 medicines as a counterproposal to the drug price control scheme.