Healthy Skepticism Library item: 15994

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Publication type: news

Esguerra CV, Yap DJ.
Palace backtracks on issuing cheap meds EO
Philippine Daily Inquirer 2009 Jul 16
http://newsinfo.inquirer.net/inquirerheadlines/nation/view/20090716-215614/Palace-backtracks-on-issuing-cheap-meds-EO

Full text:

The battle against multinational drug companies and their exorbitant prices is far from over.

Malacañang on Wednesday said President Gloria Macapagal-Arroyo would first take into account keeping foreign investors and ensuring public access to cheaper drugs before ordering a price ceiling for essential medicines.

“The implications for economic health go beyond just the issue of cheaper medicines at hand,” Gary Olivar, deputy presidential spokesperson, told reporters Wednesday.

The Palace was apparently backtracking on its tough position on Tuesday that Ms Arroyo was set to sign the executive order imposing maximum retail prices (MRP) by next week.

Olivar said Ms Arroyo was giving drug companies until July 18-or 10 days after she met with them in Malacañang-to come up with a “satisfactory” proposal to reduce their prices.

“If the drug companies do not come out with a response she deems satisfactory, then we might expect her at that point to go ahead with the maximum price ceiling regime,” Olivar said.

He said a price adjustment of a few centavos would not make much of a difference. “Certainly, we would expect and we would want to see the maximum welfare being given for our countrymen,” he said.

The Cheaper Medicines Act of 2008 seeks to increase people’s access to cheaper drugs by imposing an MRP on 22 essential medicines and by introducing competition through the parallel importation of lower-priced medicines.

The MRP covers maintenance medicines for those suffering from hypertension, diabetes, high cholesterol, cancer, stroke, asthma and infection.

Invoking a provision of the law, the Department of Health (DoH) recommended to the President a 50-percent price cut on 21 essential medicines.

Market competition

The DoH said market competition did not happen, prompting it to invoke the law’s provision on imposing the price ceiling.

Legislators have accused multinational drug firms of blocking the implementation of the MRP by offering voluntary price cuts.

They said Pfizer Philippines had tried to bribe Ms Arroyo with five million discount cards to be distributed to indigent patients so she would not sign an executive order that would cut drug prices in half.

Pfizer denied that the discount cards were a form of bribe, saying it was aimed at allowing more Filipinos to benefit from its high-quality drugs and patient-care program.

The Pharmaceutical and Healthcare Association of the Philippines, a group of 50 multinational drug firms, said there was no need for price control if the companies could lower prices by 50 percent.

Olivar said Ms Arroyo was not “compelled or required” under the law to come up with the executive order to set an MRP on essential drugs.

But she was now studying the matter because the DoH submitted to her office a draft order on June 10, the spokesperson said.

Investors’ sentiments

Olivar said the issue of reducing drug prices should also be seen in light of its implication on “investors’ sentiments abroad regarding the Philippines as an investment destination.”

He also cited the need for the government to keep investors and entice new ones to help create more jobs amid the “current recessionary environment abroad.”

“The President is responsible for (looking at) the big picture,” he said. “Others who criticize her do not have that obligation.”

Akbayan party-list Rep. Risa Hontiveros-Baraquel said that the cheaper medicines law should no longer be subject to negotiation.

The party-list representative said Ms Arroyo should not accept any condition that would allow pharmaceutical companies to resist compliance.

Promotional posters

Besides the discount cards for indigent patients, Pfizer also offered promotional posters of the President and Health Secretary Francisco Duque III in exchange for not implementing sections of the cheaper medicines law, according to Baraquel.

Baraquel said that the offer would have constituted graft had Malacañang accepted it and that Pfizer could be liable not only under Philippine laws but also under the US Foreign Corrupt Practices Act.

Speaking at the Fernandina Media Forum at Club Filipino in San Juan City, Baraquel said Akbayan and other groups were planning to write the US justice department about possible violations committed by the pharmaceutical company.

She said the information about the promotional posters came from sources familiar with the meetings between Pfizer representatives and Palace officials who said they had rejected the proposal.

Health info materials

Pfizer has denied that its offer was an attempt to bribe the Palace.

In a statement, Pfizer said the “posters” referred to by Baraquel were “in fact the health information materials proposed to be used in government hospitals, clinics and community centers” about the company’s health advocacy programs for the poor.

Pfizer said it proposed using the health department’s own tag line “To- DoH Kalusugan” to allow the participation of other stakeholders who would want to participate in any way in the department’s programs.

“It is for this reason that these posters include the photo of Secretary Francisco Duque as the head of the sponsoring government agency, and as is usual for DoH’s programs, with the photo of the President likewise included,” the firm said.

Misinterpreted

“It is unfortunate that Pfizer’s intention to join the government’s efforts to improve healthcare in the Philippines was again misinterpreted. Notwithstanding, Pfizer will continue its efforts to find solutions through constructive engagement with all stakeholders,” it said.

Pfizer said the program that it proposed to the DoH was a “comprehensive patient care program with two components-discounts on medicines and patient education.”

“Studies have shown that medication alone is not sufficient in achieving positive health outcomes for patients. Thus, the program intended to offer that important component which will provide patients with relevant health information to make them understand and better manage their diseases,” it said.