Friday, 7 May 2010

Philippines - Why have the Cheaper Medicine Act’s drug price reductions ensured volatility in the pharmaceutical market?

The Filipino government is battling with the international pharmaceutical industry for ground in the market, which up until recently experienced a free-market policy with no price regulations in place.

The Philippines paradoxically has one of the highest drug prices in the world, especially considering the majority of the population cannot afford them. Changes brought about by the controversial Cheaper Medicine Act have impacted the Philippines pharmaceutical market in a number of areas, including IP laws, competition and drug price control mechanisms.

Under the Act, 200 drugs have seen price reductions by up to 50% since August 2009. This represents 12-15% of the total market for essential drugs. The majority of drugs involved are new products in the market, whose prices are disproportionately higher in the Philippines in comparison to the Asia-Pacific region. They also tend to be drugs which are top sellers, the most expensive, and have limited generic competition.

Further reading - A detailed report on the pharmaceutical market in the Philippines is available from Espicom: The Pharmaceutical Market: Philippines (published April 2010)

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