Strategies for Affordable Medicine Pricing Policies and Price Transparency

2. Methods and issues in measuring drug prices to improve pricing policies

3. The wider problem of medicine prices • Medicines have variable and generally high prices, and are unaffordable for large sectors of the global population and a major burden on government budgets • Some evidence that prices for some key medicines are unrelated to countries’ income level • Medicine prices are rising more rapidly than other prices • Trade regulations can severely affect the price and availability of medicines • The prices of medicines are well above their production costs so there is great scope for reductions • For medicines to be affordable, appropriate and well-informed pricing policies are needed but many low income countries do not have pricing policies

4. Why measure the price of medicines? • Little is known about the prices people pay for medicines and how these prices are set – from the manufacturers’ selling price to the patient price • Reliable information is needed in order that more favourable purchasing agreements can be negotiated, domestic distribution better managed and pricing policies monitored • Price transparency empowers actors concerned with health and medicines policy • Sound data - sound policies and more affordable medicines

5. Background to WHO/HAI project on medicine prices • Absence of a standard methodology has been a stumbling block in reliable monitoring and price comparison within countries • Practical difficulty of obtaining reliable, up-to-date information on drug prices, particularly in low income countries • Methodological difficulty of making international price comparisons • WHO-Public Interest NGO Roundtable an opportunity to launch an initiative on medicine prices

6. Purpose • To promote analysis of medicines affordability, price differences within countries and what makes up the retail price in order to lower prices and improve access to essential medicines • To develop a simple and reliable methodology for collecting and analysing retail medicine prices across healthcare sectors both within and between countries (primarily low- and middle-income). • To make data freely accessible on a public web site so international price comparisons are possible

7. Designed to inform on • What prices people pay for key medicines? • How affordable are medicines for ordinary people? • Do the prices & availability of the same medicines vary in different sectors? • Do prices of the same medicine vary in different parts of the country? • What is the difference in prices of innovator brands and generically equivalent medicines? • How do procurement prices compare with international reference prices and with local retail prices? • What taxes and duties are levied on medicines and what is the level of various mark-ups which contribute to their retail prices?

8. Programme • Medicine prices: a new approach to measurement Kirsten Myhr • The Rajasthan, India experience Anita Kotwani • Ensuring data quality in the Medicines Prices project Jeanne Madden Discussion: Collecting retail prices & assessing affordability then coffee • Identifying, finding and analyzing the component costs of essential medicines Libby Levison • The influence of Value Added Tax (VAT) elimination on drug prices Saliya Karymbaeva • Comparing medicine prices among countries Jeanne Madden • HAI/WHO medicine prices website Marg Ewen Discussion: Future of price measurement methods and resources