For the first time, spending by countries on essential medicines has been quantified and the results show that a wide gulf exists between the poorest and richest nations. And the findings underscore an “urgent need” for added financing to meet basic health needs, according to a new report, which also recommends several steps to close the global spending gap on treatments.
The analysis by The Lancet Commission on Essential Medicines found that the cost of providing a basket of 201 essential medicines to all people in low- and middle-income countries could be as little as $1 to $2 per person per month, or $13 to $25 per person annually. Yet one in five countries worldwide spend less on each person each year, underlying “massive inequities.”
In 2010, for instance, the mean spending in 32 low-income countries on medicines per person was $8.80; nearly $37 was spent in 48 lower middle-income countries; about $106 was spent in 53 upper-middle-income countries and almost $459 was spent in 49 high-income countries. Significantly, individuals and families paid the most in low, low-middle-income and upper-middle-income countries.
“As a whole, the world spends eight times more on medicines” than the cost of the basket of essential medicines for all of the people in low- and middle-income countries, illustrating the inequity among nations, said Andy Gray, a senior lecturer at the University of KwaZulu-Natal in Durban, South Africa, who was one of 21 international health policy experts assembled by The Lancet to study the problem.
The report arrives at a time of increasing concern over the inequities on pharmaceutical spending, but also rising anxiety across the globe over the cost of medicines. As the commission noted, the US is also experiencing the same problem thanks to price tags for new medicines for combating such hard-to-treat diseases as hepatitis C and various forms of cancer, but also older, generic drugs.
Two months ago, the United Nations released a lengthy report urging governments to take various steps to ensure greater access to needed medicines. However, the list contained several proposals that have previously caused struggles with the pharmaceutical industry, underscoring the challenges in reaching a consensus for implementing recommendations.
The 84-page Lancet report contains a slew of fixes — systems for routine monitoring of affordability, price, and access; implementing existing policies under World Trade Organization rules for compulsory licensing; greater use of product assessments to gauge benefits and value; delinking R&D costs from pricing; and increased transparency from the pharmaceutical industry.
What else? The commission recommended pooled procurement; improving the quality of medicines, which are often lower quality in poorer countries with regulatory systems; and avoiding the overuse or abuse of certain medicines, such an antibiotics and opioids. The commission also believes the international community should create an essential medicines patent pool to license patents to other companies in order to create a competitive generics market in low-income countries.
Many of these are familiar and have appeared in recommendations from the World Health Organization, but the commission also proposes two dozen indicators for measuring progress. Some examples include household expenditure on pharmaceuticals as a percentage of total household expenditures; median availability of a basket of essential medicines in the public and private sectors and the number of licensing agreements for essential drugs concluded through patent pooling.
“Many of the countries don’t have updated reports, for instance, on the out-of-pocket cost for pharmaceuticals as a percentage of total pharmaceutical spending, and that’s a key indicator of affordability when you look at universal health coverage,” said Veronika Wirtz, an associate professor of global health at the Boston University School of Public Health and also a commission member.
Ultimately, improved access and affordability will require effort from a variety of players, including patient advocates, regulators, national health institutions and industry. But Hans Hogerzeil, a professor global health at the University of Groningen in The Netherlands, maintained that international agencies and governments should take the lead in setting priorities for R&D and using patent laws.
“It’s a failure to rely on public markets to fund development of needed medicines,” he said. “…it’s simply not fair that everybody has money for medicines, except for about 20 percent of the countries in the world.”