Healthy Skepticism Library item: 6316
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Publication type: news
Kindermans JM, Den Boer M
Price reduction for antimalarial Coartem
e-drug 2006 Oct 20
http://www.essentialdrugs.org/edrug/archive/200610/msg00054.php
Full text:
E-DRUG: Price reduction for antimalarial Coartem
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Dear E-druggers,
We would like to comment on Novartis’ recent announcement regarding the
price of the antimalarial combination treatment arthemether/lumefantrine
(AL, marketed as Coartem). On September 29th, 2006, Novartis announced a
36% reduction on the average price of Coartem for public health services.
The price reduction for the blister packs for children is more significant
(50% reduction) than for adults (25% reduction).
The high cost of fixed-dose artemisinin-based combination therapies (ACTs)
has been a fundamental obstacle to implementing changes in malaria
protocols because it increased the level of funding required for new
protocols as well as the sustained financial support needed in the long
run. This is particularly true for Coartem. Novartis had a monopoly on the
production of AL for years.
MSF welcomes this long-awaited price reduction. We have witnessed the lack
of access to Coartem in many endemic countries where governments and
patients could not afford the drug because the price was substantially
higher than the older but ineffective antimalarials.
The main limitations to ordering ACTs is rooted in the Global Fund (GF)
policies, making sustained financial support for more then a few years
uncertain, and the complex and lengthy procedures involved to get funding
proposal approved. As a result, less than 20 million ACT treatments have
been ordered with GF money in 2005. This represents less than 5% of the
reasonably estimated needs (400 million treatments) and is an unacceptably
low achievement for an agency in place for more than 4 years now.
Hopefully, this price decrease will make a difference. Novartis states that
this reduction is possible because they subsidize the production (by more
than US$ 10 million a year). The potential level of this ‘subsidy’ is
however difficult to estimate, as the production cost for
artemether/lumefantrine (AL) is not available as such, but varies according
to the producer. Undoubtedly, Novartis price reduction has been motivated
by the desire to ‘boost orders towards a level of Novartis current
production capacity’ (100 million treatments per year).
It comes just after September 1st, when the GF accepted a new version of
this product (manufactured by Cipla) in its compliance list, which allowed
grantees to purchase from that source with GF money. The price of this
generic source was offered 5 to10% below the previous Novartis’ price, and
according to Cipla, the price could be further reduced soon. And it is not
the only generic source competing now. Ajanta has also proposed AL to MSF
at prices that are very close to the new Novartis price. IPCA has finally
recently launched its generic version of AL. All these companies are
competing now for big orders made on behalf of governments.
In addition, other competitors for fixed dose ACTs will soon enter the
market with a price lower than the former Novartis’ price for Coartem (they
will be close to US$ 1 per adult treatment): amodiaquine + artesunate, or
lapdap+ artesunate in 2007, while dihydroartemisinin + piperaquine should
follow quickly.
In our view, this whole process confirms that competition remains the main
and most effective drive to reduce the prices of drugs, and this has to be
enhanced. The price of artemisinin raw material illustrates this. It is
today two to four times lower than the price proposed 18 months ago when
shortages were threatening, because many producers have since jumped into
what they felt was a promising market.
Many endemic countries still use ineffective drugs, including chloroquine.
We hope that very soon, many different types of ACTs, produced by various
producers for prices not higher than one dollar per treatment, will be
available in order to guarantee, together with sustained and effective
funding, the urgently needed implementation of ACT protocols.
J.M.Kindermans and M. den Boer
Campaign for Access to Essential Medicines
Medecins Sans Frontieres (MSF)
Office details
Artsen Zonder Grenzen (MSF)
Plantage Middenlaan 14
1018 DD Amsterdam
The Netherlands
tel (31) 20 5208763/fax (31) 20 6205170
mobile +31624661443
margriet.den.boer@amsterdam.msf.org
