medicines prices: policy options for vietnam€¦ · anti-pyretics antibacterials vitamins cardiac...

WHO Country Office for Viet Nam

Medicines Prices: Policy Medicines Prices: Policy Medicines Prices: Policy Medicines Prices: Policy

Options for VietnamOptions for VietnamOptions for VietnamOptions for Vietnam

WHO Briefing with the National Assembly-Committee on Social Affairs18 November 2010

Hanoi, Viet Nam


Presentation Outline

Part I: Introduction: Why are Medicines Prices a Concern?

Part II: What medicines are paid most and consumed in Viet Nam?

Part III: How high are medicines prices? Part IV: The price control mechanism in

Viet Nam: impact on patient and government resources

Part V: Policy Options for Viet Nam


Part I: Why are medicines prices a concern?

….price can be an absolute barrier to access by the poor.

Dr Margaret Chan

WHO Director-General

16 July 2010


Why are Medicines Prices a Concern ?Medicines prices make people poorer

Source: Nielsen, M, et.al., Quantifying the Impoverishing Effects of Purchasing Medicines, PlosMedicine, August 2010, Volume 7, Issue 8, www.plos.org


Why are Medicines Prices a Concern ?

Medicines prices comprise a large proportion of household expenditure

Source: Beran, D., Report on the Rapid Assessment forInsulin Access in Vietnam, 2008, International DiabetesFederation

Families with diabetic patients would need to geta loan (51.5%) or sellassets (21.2%) to fund diabetes care and treatment


Why are Medicines Prices a Concern ?

Medicines comprise a large part of expenditure for health

Source: Vietnam Social Security, 2010

2009: 69.9% of health

expenditure paid by health insurance

for medicines

2008: The mean cost of care for a

Person with diabetes in Hanoi is 121% of

GDP per capita



Part II: How are medicines used in Viet Nam?

… there is an evidence of widespread irrational use. Irrational use wastes government and patient resources


What medicines are consumed and paid most?

Table 1. Top 30 molecules by value from January to June 2010

TrimetazidineGlucosamineCefpodoxime proxetil

SodiumGliclazideCefoperazone + Sulbactam

RabeprazoleGinko BilobaCefixime

ParacetamolEpoetin AlfaCefalexin

PantoprazoleClopidogrelAtorvastatin

PaclitaxelCilastatin + ImipenemAscorbic Acid

OxaliplatinChymotripsinAmoxcillin + ClavulanicAcid

OrnithinCefuroxime AxetilAmoxicillin

OmperazoleCeftriaxoneAmlodipine

LevofloxacinCeftazidimeAlbumin

Source: IMS Health, August 2010



There is a trend for over-use of expensive and non-essential medicines


Fig. 1. Volume of Top Molecules

0 500 1000 1500 2000 2500 3000 3500 4000 4500

SodiumParacetamol

Ascorbic AcidTrimetazidine

CefalexinAmoxicillin

ChymotripsinAmlodipineGliclazide

GingkoOmeprazoleGlucosamin

CefiximeAmox-clavulanic acid

Cefurozime axetilAtorvastatin

RabeprazolePantoprazole

Cefodozime-ProxetilLevofloxacin

OrnithineClopidogrel

Cefoperazone-Ceftazillin

CeftriaxoneCilastatin

Epoeitin Alfa

Mol

ecul

es

Volume (in million CU)



Fig 2. Volume of Top Molecules (- Sodium eyedrops)

0 50 100 150 200 250 300 350 400 450 500

ParacetamolAscorbic AcidTrimetazidine

CefalexinAmoxicillin

ChymotripsinAmlodipine

GliclazideGingko

OmeprazoleGlucosamin

CefiximeAmox-clavulanic acid

Cefurozime axetilAtorvastatin

RabeprazolePantoprazole

Cefodozime-ProxetilLevofloxacin

OrnithineClopidogrel

Cefoperazone-sulbactamCeftazillin

CeftriaxoneCilastatin

Epoeitin Alfa

Mol

ecul

es

Volume (in millions CU)





Fig. 4. Volume of top molecules by therapeutic cate gory

0 50 100 150 200 250 300 350 400 450 500

Anti-pyreticsAntibacterials

VitaminsCardiac therapy

AntacidsAntihypertensives

Anti-diabeticsPsycoanaleptics

Anti-inflammatoryLipid reducing agent

Bile and LiverAnti-thrombotics

Mol

ecul

es

Volume (in millions CU)



Preference for expensive and high generation antibiotics


Fig. 5. Volume of Top Antibiotics

0 20000000 40000000 60000000 80000000 100000000 120000000 140000000 160000000

Cefalexin

Amoxicillin

Cefixime

Amox-clavulanic acid

Cefurozime axetil

Cefodozime-Proxetil

Levofloxacin

Ceftriaxone

Cefoperazone-sulbactam

Ceftazillin

Ant

ibio

tic m

olec

ule

(IN

N)

Volume (in CU)


Part III: How high are medicines prices?

…essential medicines in Viet Nam are priced higher than the international reference prices.

…health service providers in the public sector procure and use more expensive medicines.


Prices to patient

The prices patient pay are higher than the international reference prices

Source:


Prices to patient

Patients can hardly afford medicines in Viet Nam

1) It would take 13.5 days wages to buy treatment for ulcer (150 mg Ranitidine) for 30days.

2) It would take an additional number of days wages if the innovator brands are bought

Source:


Procurement Prices

Procurement prices of medicines are generally higher compared to WPR countries

Source:


Procurement Prices

Procurement prices of medicines are generally higher compared to WPR countries

Source: Medicines make people poorer, sicker: WHO Country Office for Viet Nam, 2010

Fig.1. Procurement prices of selected medicines in Vietnam compared with international reference prices

0 0.5 1 1.5 2 2.5 3 3.5 4 4.5

AciclovirAmoxicillin + Clavulanic Acid

AtenelolAtorvastatin

CarbamazepineCeftriazone

CiprofloxacinDiazepam

Diclofenanc (Brand)Enalapril

FluoxetineGlibenclamide

GliclazideHydrochlorothiazide

HydrocortisoneInsulin Isophane

MetforminNifedipine Retard

OmeprazolePhenytoinRanitidine

SalbutamolSimvastatin

Sodium Valproate

Price in USD

WPROIRP

Viet Nam

Note: Procurement prices were compared based on the data submitted by countries to the WPRO Price Information Exchange Systemwww.piemeds.com


Procurement Prices in Hospitals

There is a wide variation of procurement prices across hospitals

Source: WHO analysis based on summary of winning bid prices, 2009, www.dav.gov.vn

Gliclazide 80 gm: Price variation among hospitals

0

500

1000

1500

2000

2500

HP1 HP2 H3 H4

Hospitals

Pri

ce (

VN

D)

LP

Median

HP


Procurement Prices in Hospitals

There are cheaper medicines, but hospitals procure them less

Source: WHO analysis based on summary of winning bid prices, 2009, www.dav.gov.vn

Atorvastatin 10 mg: Bid Prices Across Hospitals

02000400060008000

1000012000140001600018000

Hospitals

Pric

es (

VN

D)

36,000 u

150000 u10,000 u

339,506 u


Part IV: Price Control Mechanism in Viet Nam

… there is a need to assess the price control mechanism of Viet Nam in terms of

its impact to patients and government


Price Mechanism in Viet Nam

Three main mechanisms:

1). Price to patients are not controlled- left to competition

… there is a need for an active advocacy and information system for patients to know of the availability of cheaperalternatives



2) Medicines covered by public funds and insurance are subject to the following:

CIF Pricesdeclared

WholesalePrices

Declared

Maximumbid prices in

hospitals

Compared to CIF in other countries

“reasonableness” of price is determined

Bid prices not to exceed declared WP

A robust information and monitoring system needs to be provided



3) Maximum profit in hospitals are determined as:

5%Over VND 1,000,000

7%Over VND 100,000 to VND 1,000,000

10%Over VND 5,000 to VND 100,000

15%Over VND 1,000 to VND 5,000

207%Less than or equal to VND 1,000

Maximum retail surplusDrug value based on original price of smallest packing unit

Note: Currently revised by DAVSource: Decision No. 24/2008/ QD-BYT



There is wide variation of prices across private pharmacies

Patients are not informed of more affordable alternatives




In general, the range of bid prices in hospitals are higher than the declared wholesale prices

Cefixime 100 mg: Declared Wholesale vs Bid Prices

0

2000

4000

6000

8000

10000

12000

14000

16000

Declared Prices (2008-2009) Bid Prices (2009)

Pri

ces

(VN

D)

Source: WHO Analysis based on declared wholesale and winning bid prices fromwww.dav.gov.vn; retrieved, October 15, 2010


Part V: Recommended Policy Options for Viet Nam

… drug pricing policies should promote access to essential medicines, especially for

the poor

… drug price control alone cannot reduce prices and cost to patients and government

… a comprehensive and combined approaches must be pursued to reduce prices

and improve access


Recommended Policy Options for Viet NamI. Core and Immediate Actionsa) Review and assess impact of current price control

mechanismb) Comprehensive Policy for Generics (Generic Medicines

Law)c) Provide maximum re-imbursement based on low priced

generic medicinesd) Reform the bidding and procurement system for

medicines

II Supportive Actionsa) Ensure quality of generic medicinesb) Monitor and control drug utilization and prescription


Recommended Policy Options for Viet NamA. Review and assess impact of current price

control mechanism

1. Implement monitoring system to compare wholesale prices vs bid prices in hospitals

2. Use procurement prices for international referencing, rather than the CIF.

3. Use internal referencing system based on molecules4. May consider to set maximum retail price for a carefully

selected number of medicines (based on criteria and evidence) that affect public health and the poor.Examples: insulin, medicines for chronic diseases


Recommended Policy Options for Viet NamB. Comprehensive Generic Policy (Generics Law)

1. Mandatory use of generic names in labelling and registration

2. Mandatory use of generic names in procurement and prescription of medicines

3. Re-imbursement should be based on generic medicines prices

4. Active and sustained advocacy for the use of generic medicines among patients

5. Eliminate barriers for generic competition ( such as extra-TRIPS provisions on data exclusivity and patent linkaging)


Recommended Policy Options for Viet NamB and C. Comprehensive Generic Policy

(Generics Law) and reimbursement based on genericsAtorvastatin 10 mg: Bid Prices Across Hospitals

02000400060008000

1000012000140001600018000

Hospitals

Pric

es (

VN

D)

62,000u

339,506 u

Huge savings can be achieved withgenerics:The savings to be incurred if the lowestpriced generic is boughtwould be:VND 4,733,053,000


Recommended Policy Options for Viet Nam

D. Reform the Bidding and Procurement System for Medicines

1. Bidding for medicines should be on the basis of molecules,

2. Consider to have a centralized tendering system for medicines reimbursed by Health Insurance

3. Establish a mechanism for supplier pre-qualification to ensure sustainability of supply and quality of generic medicines



E. Establish a multi-sectoral Medicines Price Policy Board

1. With multi-stakeholder representation2. Evidence-based decision making process3. Set criteria for inclusion of medicines that will be

subject to price controls or regulation4. Formulate and monitor price policy decisions



Supportive Actions• Ensure quality of generic medicines and publish

testing results – to improve doctor and public trust on generic medicines

• Provide adequate support to DAV/MSA in monitoring drug utilization and prescription audits

• Institute a robust monitoring and information for procurement and retail prices of medicines.


Thank You

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