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[afro-nets] Price control and regulation of drugs

  • Subject: [afro-nets] Price control and regulation of drugs
  • From: Claudio Schuftan <claudio@hcmc.netnam.vn>
  • Date: Tue, 12 Oct 2004 17:22:25 +0700
  • Cc:

Price control and regulation of drugs

From: "K Bala" <kbala12@yahoo.com>

"Why should the pharma sector suffer the 'rigours of price con-
trol' when other producers are being de-controlled de-licensed
and de-regulated?".

"There is a general impression that drugs in many countries are
not price controlled".

A major policy decision on drug pricing that will affect the
health, suffering and death of millions should be based on the
critical analysis of empirical data and not on vague, general
impression (as mentioned by those who do not want price con-

What is the international experience on drug pricing policies,
regulation and control of the pharmaceutical sector?

Here is some empirical data. All the advanced industrialized
countries (OECD) are market economies, with liberalization and
deregulation of all sectors. However, all these countries, ex-
cept the US, have kept health out of the market. Market forces
do not dictate the price of drugs. A system of public health in-
surance either by general taxation or social security enables
these countries to provide universal health coverage. The US,
the richest country in the world, has dismally failed to provide
universal health coverage for all its citizens. Over 40 million
people in the US have no health insurance and another 60 million
are under insured. This means that 40 percent of US citizens
have no regular access to health care because this is the unfor-
tunate outcome of shifting health to those who control market

In 15 of the OECD countries, patients pay out of pocket only 8-
24 percent of the total healthcare costs. Even in the US, pa-
tients pay 35 percent of the total. In India households have to
pay over 80 percent out of pocket. How much is it in your coun-