Balancing Healthcare Goals is Imperative
Insurance cannot stand in for a public healthcare system for the poor. At the same time, policy must offer returns to private sector investment in innovative drug discovery .
From a pharmaceutical care perspective, continuing world development presently demands progress on two broad fronts. First, all existing medicines necessary for the people’s overall health need to be made universally available. This implies ensuring sufficient volumes of essential drugs are accessible at low cost. It also requires overcoming the daunting and expensive challenge of ensuring that all people, rich or poor, have access to the professional support that facilitates the effective use of pharmaceutical treatments.
Second, without investment in better medicines and vaccines, many health problems facing humanity will never be satisfactorily resolved. Supporting ongoing private and public pharmaceutical research will demand appropriate intellectual property laws and drug pricing arrangements needed to adequately incentivise genuinely innovative but inherently high-risk pharmaceutical research and development. This is necessary because few, if any, governments have ever channelled public money into such domains without hope of future financial gains
For some analysts, the two goals of improving access to medicines today and ensuring the research-based industry is funded well enough to meet tomorrow’s needs are irreconcilable. In the past, commentators such as the Nobel Prize winning welfare economist Amartya Sen have argued that in the Indian context, pharmaceutical patents may do more harm than good.
But the emergence of modern India as both a major producer of pharmaceuticals – it is now the world’s third largest pharmaceutical manufacturer in volume terms – and a world leader in other areas of knowledge-based enterprise is today an important example of a country seeking to achieve a better internal policy balance between equity and innovation. This has involved both movements towards accepting the strengthened intellectual property related provisions needed to foster research-based industry, and new attempts to address concerns about the high – potentially ruinous – out-of-pocket medical costs incurred by the poor and India’s notable lack of an adequately-funded public health service.
In the latter area, initiatives such as the National Rural Health Mission and the Rashtriya Swasthya Bima Yojna health insurance scheme are indicative of progress. Yet in the medium to long term more radical approaches to funding a national healthcare system to assure the ‘right to health’ embodied in the country’s constitution may well prove vital.
Costs and Benefits of the Draft NPPP
At present, national and international attention is focused on the draft National Pharmaceutical Pricing Policy which seeks to reduce the prices of many more expensive formulations. Viewed positively, the NPPP-2011 could, if implemented, help make good quality products more widely affordable, and to rationalise the existing marketplace by, for example, reducing any tendency for medical prescribing to be distorted by financially linked factors. Nevertheless, the desirability of the suggested new price controls can be questioned at many levels.
Firstly, although better-off people will be advantaged by being able to obtain high quality ‘international brand’ medicines at lower prices, the proposed changes would not increase access amongst poorer sections of society. India already enjoys amongst the lowest average pharmaceutical prices worldwide. Arguably, introducing ‘ceiling prices’ will contribute little if anything to answering more challenging questions relating to universal care provision, and the supply of treatments at or even below marginal production costs in the least-well-served communities. The latter might in fact be facilitated by the availability of higher prices elsewhere in the domestic market.
Secondly, following from the above, it may be also be felt that the aim of lowering prices of more costly branded formulations is related more to achieving industrial (as opposed to welfare) policy goals. The full likely impacts of the presently planned interventions are difficult to assess. But although they are said to be based on a market-based pricing approach (which implies the existence of a degree of competition that calls into question the need for any further intervention) they could in theory have a protectionist effect by selectively disadvantaging international companies, due to legitimate operating cost differentials. If this proves true, it might thereafter discourage international investment in India or promote other undesirable reactions contrary to public interests.
Thirdly, economists who favour regulated competition may regard any Drug Price Control Order (DPCO) based strategy as inherently suspect. They are more likely to accept the need to fully recognise and stop corrupt practices such as promoting the use of medicines that are needlessly costly to patients via financial ‘kickbacks’. It does not appear that the presently envisaged changes would achieve this last end without more fundamental reforms.
Serving Global Public Health Interests
Indian health and economic policy-makers should try to do whatever they judge best for the Indian population. In a global market characterised by increasingly complex inter-dependencies between nations, commonly agreed interests of the world community need to be considered in all aspects of decision making, including those relating to the pharmaceutical sector. Past attitudes and ‘policy pathway dependencies’ might need to be revised in light of the fact that no country can stand alone.
For instance, decision makers may in future increasingly need to accept that as global development proceeds all countries should seek to spend similar amounts of their wealth on health and other welfare services, to further reduce not only internal inequalities but to enhance social justice globally. Otherwise, while elites may grow increasingly wealthy, there will be a danger of exporting poverty level wages for the less privileged right across the world. Likewise, richer members of any community should also arguably be prepared to make fair levels of contribution to the funding of research into new forms of treatment, regardless of where it can most cost effectively be undertaken.
The further development of more far-reaching alternatives and ideals such as those represented by, say, the establishment of Jan Aushadhi pharmacies, could be geared to provide not only ‘true generic’ products at well below average market prices. From a pharmaceutical care standpoint, it could also open the way to publicly resourced pharmacist-led prescribing and advice. This would challenge existing medical paradigms and could significantly enhance overall public health in contexts such as cardiovascular disease prevention and treatment.
The global healthcare community, which includes those national and international pharmaceutical companies that invest in innovative medicines research and are genuinely seeking to contribute to better outcomes, should support all those working to implement such potentially beneficial changes in the country. Today India is too economically important for any policy maker committed to increasing world prosperity to ignore, and its people’s needs are socially too significant for any health professional interested in improved world health to allow them to pass inadequately addressed.