Think tank moots competition, not price controls for medication

PETALING JAYA: A think tank today questioned the need for price controls on medication, warning that such a mechanism would send a red flag to the international pharmaceutical, biotechnology and life sciences community.

The Galen Centre for Health and Social Policy said the move could affect thousands of people whose lives depended on access to innovative medicines or drugs which had no generic or biosimilar counterparts as of yet.

“This effort at cost-containment, though high-minded and well-intentioned, is fraught with risks and consequences which extend beyond the health sector.

“Most economists consider price controls as a drastic action which distorts the market and often ends up victimising the very people they are intended to help. Contrary to popular belief, they are not magic bullets,” Galen CEO Azrul Mohd Khalib said in a statement.

He was responding to Deputy Health Minister Dr Lee Boon Chye’s recent announcement that the government would introduce a price control mechanism on medication before the tabling of the 2019 budget.

Azrul questioned whether the government had undertaken a Regulatory Impact Assessment before adopting the proposal on price controls for medication.

He also asked whether the Regulatory Impact Statement had been published and if consultations had been held with the relevant stakeholders.

“The advantages and disadvantages in the use of price controls should be fully understood and made known to the Malaysian public before they are imposed.

“After all, increasing transparency, accountability and consultation were among the promises of the new government,” he said.

He pointed to countries such as Canada which had implemented similar mechanisms that succeeded in controlling prices but could not check drug expenditure.

“Drug expenditure continued to rise due to population demographics, prescribing practices and increasing prevalence of non-communicable diseases,” he said.

He said implementing price controls could cause Malaysia to be regarded as a risky and unpredictable place to introduce new and innovative drugs for the treatment of cancer and rare diseases.

“Fewer new drugs would become available to Malaysian patients, depriving them of the benefits of advances in medical research,” he added.

He said Galen supported the government’s goal of gradually increasing the use of generic drugs from 60% to 80% by 2020.

“In fact, some of the first targeted cancer drugs are now reaching the end of their patents, enabling generics to be reproduced.”

However, he warned that not all drugs had generic or biosimilar equivalents, adding that patients did not have the luxury of time to wait for patents to expire.

“Competition provides for the possibility of better and improved treatment options, lower drug prices, increased affordability and coverage.

“It contributes to improving the quality of life for patients and, most importantly, has the potential to save lives,” he said.