To make drugs affordable for the common man... As far as the common man is concerned, the rising price of drugs is now becoming a serious issue. In what comes as a relief, five state governments have united to make drugs affordable for the common man. The Chief Executive Officers of the Central drug procurement remains unattended. What has the government been doing to control the drug prices? What provisions are there for the poor, enabling them to avail of medicines at subsidised rates? Do the government’s interpretations of the situation carry any weight? The ultimate control over medicine prices remains with manufacturers, both national and international. The primary reason behind the spiralling prices of medicines is the enormous clout of the manufacturers that influences the mechanism behind artificial pricing, says an official of All Kerala Chemists and Druggist Association (AKCDA). At present, there is no provision enabling major drug companies to sell medicines directly to retailers. All drug majors rely on distributors because of their bulk buying capacity. The margin for distributors and retailers is poor as most drug companies do not produce drugs which come under the Drugs Price Control Order. Therefore, retailers are compelled to sell drugs at the MRP. While there are more than 1,500 distributors and 10,000 retailers in Kerala, there is no stern government regulation to control them. Seventy-four life-saving medicines were included in the Drugs Price Control Order 1995, which made up almost 30% of total medicines marketed on cost-based pricing. Later, the companies gradually reduced the number of medicines, leading to unavailability of life-saving drugs. This compelled people to choose alternative medicines at higher prices. Since bulk purchase is the key factor that prevents drug companies from selling to retailers, the All Kerala Retail Druggists’ Association (AKRDA), an organisation formed by retail shoppers within AKCDA, plans to make bulk purchases directly from the drug companies. With contributions from all its members, AKRDA can FUTURE MEDICINE I August 2012
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agencies in Gujarat, Karnataka, Rajasthan, Tamil Nadu, and Kerala recently decided to form an alliance to make drugs more accessible to the common man. These states signed the Thiruvananthapuram Declaration, deciding to formulate common policies on drug procurement and data sharing to make drugs accessible to the common man. According to Biju Prabhakar, Managing Director of Kerala Medical Services Corporation, this is the first initiative in the country aimed at controlling drug prices.
buy large quantities from companies. lower prices. The civil supplies rationing This will, in turn, enable retailers to get system can be emulated to ensure that drugs at wholesale rates. If everything medicine supply services are provided goes as per the plan, customers will to the poor in a more transparent and be getting medicines at rates lower humane manner. The government should than the MRP. Currently, there are at least try to make high-cost medicines some big retail networks in the state available at low prices for people below which offer discounts on purchases the poverty line. for their privileged customers. So do some government A discussion is underway agencies. Government- between Consumerfed and major run Consumerfed drug companies for bulk is one such agency, purchase without the where medicines are sold at subsidised involvement of middlemen. In a rates. Unfortunately, recent statement, Cosumerfed you are not going to had said that it could sell find many medicines there as those may be medicines through its Neethi unavailable owing to Stores at much lower prices if the the lobbying in the industry. A discussion commission that is being given to the agencies was avoided. It is underway between Consumerfed and major has also decided to build drug companies for bulk purchase without warehouses in all districts to store medicines the involvement of middlemen. In a recent statement, Cosumerfed had said that it could sell medicines through its Neethi Stores at much lower prices if the commission that is being given to the agencies was avoided. It has also decided to build warehouses in all districts to store medicines. Besides, if medicines are sold through governmentrun outlets, the competition in the field will disappear and the poor can buy life-saving drugs at