Access, Pricing & Quality of

Non-communicable Diseases Medicines

Prepared by: Sinyee Ng, SDSC-HEA Intern

Supervised by: Dr Susann Roth, Senior Social Development Specialist

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 Outline
Context and issues
Methodology of the study
Findings
Malaysia
Indonesia
Philippines
Enablers and Barriers
Actions for ADB
Limitations of Study
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Context and Issues
NCDs
Quality of Medicine
The perfect supply chain

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 2012
(WHO 2014) NCDs need Medicines
56 million
deaths

38 million
NCD-related

Malaysia (2008)

LOST more than 1.5

More than million life-years
80%
42% in 30-59 years old
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 Regulation of Medicines: A Need
Reasons for regulation Potential Impact
Substandard
Counterfeit Medicines Fake
Falsified
Cheating
Reduced custom controls
Trade Liberalisation Higher mobility of goods
and people

Considerable threat to
Compromised Safety human lives 5 of 31
 Ideal Supply Chain System
QUALITY ASSURANCE (QA) CREDIBLE WHOLESALERS /
DISTRIBUTORS
CREDIBLE MANUFACTURERS - Good Distribution Practice
- Good Manufacturing Practice - Timely Delivery

1 NO TAX / TAFIFFS NO DISTRIBUTOR MARKUPS

MARKET
TRANSPARENT QA
2 3 4
PROCUREMENT DISTRIBUTION DELIVERY
FUNDS QUALITY ASSURANCE from INTEGRATED information
ENTRY to EXIT system
PERFECT COMPETITION NO VAT / SERVICE CHARGE /
MARKUP
NATIONAL MEDICINES POLICY
TRANSPARENT QA
PERFECT DEMAND FORECASTING
OPEN 24 HOURS
EFFICIENT & TRANSPARENT
PROCUREMENT PROCESS PERFECT DENSITY OF PROXY-END
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USERS e.g. pharmacies
Methodology
Framework
Desk review
Secondary data analysis
Key informant interviews
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 Methodology
1) Supply Chain Management
FRAMEWORK 2) Quality Assurance
3) Affordability
1) Malaysia, Indonesia, Philippines
DESK REVIEW 2) English, Malaysian, Indonesian
1) Government publications
SECONDARY 2) Policies
DATA 3) Legislation
1) Semi-structured
KEY INFORMANT 2) Department of Health;, Health care
INTERVIEWS professionals; Consumers
3) ONLY in the Philippines 8 of 31
Findings
Malaysia
Indonesia
The Philippines
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 Malaysia: Key Facts
GNI per capita: US$ 9850

Two-tier system:
Tax-financed public sector
Fee-for-service private sector

Pharmaceutical expenditure:
Per capita (PPP): US$ 198.8 (19.1% of Total Health Expenditure per Capita)
45.7% Privately financed

Sources of Private Financing

Out of Pocket: 35.3%
Private Health Insurance, Social Security Systems, Others: 11.1%
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Malaysia Public Procurement and Supply System
Pharmacy Information System (PhIS)
Pharmaniaga Value Type of procurement
Distribution Pharmaniaga
x > RM 500,000 National Tender
APPL (Concession)
RM 50,000 < x < RM 500,000 Quotation (at least 5)
Cancer x < RM 50,000 Direct Purchase
medicines e-Perolehan

LP Other pharmaceutical
Pharmacy Logistics companies (Local or
Unit, Hospital MNCs) Pharmaniaga
Distribution
District Health Companies contracted
Outpatient Pharmacy, Office distributors
Hospital
In-house Transport
IDDS service Pharmacy Unit,
In-house Primary Care Clinics
transport /
Pharmacy Value-added Service
Courier Service
Pharmacy Value-added
Consumers
Service

Legend
Drug Order and Circulation
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Drug Distribution
Malaysia Private Procurement and Supply System

Pharmaceutical Companies Wholesalers/Distributors

(Local and MNCs)

Private Primary Care Private Community

Clinics Pharmacies

Consumers
Legend
Drug Order and Circulation

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 Supply System Performance: Malaysia
CONTINUOUS QA
(registration)
DIVERSE distribution means
MINIMAL competition
CONTINUOUS QA
FREE PRICING (private)
1
MARKET NO regulation on mark-up

2 3 4
PROCUREMENT DISTRIBUTION DELIVERY
FUNDS

INTEGRATED / SELF CONTINUOUS QA

information system DIVERSE opening hours
CONTINUOUS QA (public)
UNSUPERVISED dispensing
MINIMAL price regulation (private)
(private) GST 6% (Essential medicines
BONUSES from exempted)
pharmaceutical companies NO regulation on final retail price 13 of 31
 Indonesia: Key Facts
GNI per capita (PPP): US$ 3400

Decentralised national health insurance system (public)

2014: Consolidated a total of 3 social health insurance programmes (civil
servants, formal workers, the poor) covering half of the countrys population

Pharmaceutical expenditure:
Per capita (PPP): US$ 109 (34.7% of Total Health Expenditure per Capita)
85.7% Privately financed

Sources of Private Financing (WHO. HiT 2017)

Out of Pocket: 45.2%
Private Health Insurance, Social Security Systems, Others: 14.3% 14 of 31
Indonesian Public Procurement and Supply System

MoH
Develop Ceiling Price for
tender and negotiation.
Compile national estimation of
medicine needed (Rencana LKPP (e-Catalogue)
Kebutuhan Obat/RKO)

Approved
within 7 days
Pharmaceutical companies
e-Purchasing Wholesalers/Distributors
(Local and MNCs)
BPJS

Pharmacy
District Health Pharmacy Unit, Installation,
Office Puskesmas Public Hospital
Legend
Drug Order
Price Negotiation
Pharmacy Unit, Drug Distribution
Puskesmas Reimbursement

Consumers 15 of 31
 Medicine Base Price for medicines not in e-Catalogue
Price, smallest unit (Rp)
No. Drug Name Packaging
Region 1 Region 2 Region 3 Region 4 Region 5
1 Tab. Ramipril 10mg Strip/Blister 1.013 1.064 1.165 1.216 1.266
Tab. Telmisartan
2 Strip/Blister 3.045 3.045 3.045 3.045 3.045
40mg
Tab. Telmisartan
3 Strip/Blister 5.409 5.409 5.409 5.409 5.409
80mg
4 Tab. Valsartan 80mg Strip/Blister 832 874 957 998 1.040

5 Tab. Valsartan 160mg Strip/Blister 1.325 1.391 1.524 1.590 1.656

6 Tab. Lisinopril 20mg Strip/Blister 299 299 299 299 299

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Indonesian Private Procurement and Indonesian Private Procurement and
Supply System (NHI) Supply System (NON-NHI)
Pharmaceutical
(a) Pharmaceutical (b)
companies
companies (Local and MNCs) (Local and MNCs)

Wholesalers/Distributors
Wholesalers/Distributors

e-Purchasing Manual Order

(directly online through (off-line through wholesalers,
LKPP system) price and product according Private Sectors
to e-catalogue) Community Pharmacies, Private Hospitals, Clinics,
Drug stores
BPJS
Private Sectors (Contracted by
BPJS)
Community Pharmacies, Private Hospitals, Consumers
Clinics, Drug stores Legend
Drug Order
Reimbursement
Drug Circulation
Consumers 20 of 31
 Supply System Performance: Indonesia
ONLY GENERICS in public INTEGRATED logistics
CAPPED pricing (Medicine information system (e-PBF)
Base Price) CAPPED mark-up

1 INSUFFICIENT QA DELAY up to a few months

MARKET MINIMAL participation in bids SUBOPTIMAL good practice
application

2 3 4
PROCUREMENT DISTRIBUTION DELIVERY
FUNDS

AVERAGE DISTANCE to health

facilities 5km
INTEGRATED logistics CAPPED maximum retail price
information system - Inclusive of VAT and 28%
Pharmacy Service Charge
NOT ALL medicines in
National Formulary are INEQUITY in health facility distribution
listed LACK of ENFORCEMENT of
Maximum Retail Price 21 of 31
Coverage area of National Regulatory Authority:
Main Offices and Provincial Offices

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Source: http://www.pom.go.id/new/view/direct/lwsispom
 Philippines: Key Facts
GNI per capita (PPP): US$ 3580

Decentralised social health insurance system

Pharmaceutical expenditure:
Per capita (PPP): US$ 109.4 (33.3% of Total Health Expenditure per
Capita)
85% Privately financed

Sources of Private Financing

Out of Pocket: 53.7%
Private Health Insurance, Social Security Systems, Others: 26%
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Philippines Public Procurement and Supply System Only for NCD medicines (Hypertension, Diabetes, Cancer)
Other vertical programmes not reflected.
Procurement
CENTRAL LOCAL GOVERNMENT GOCC
Listing
Newspapers
Programme Managers PPMP DoH- APP Listing Procurement
LGU PPPI
of ComPacks & MAP PD COBAC PhilGEPS
Pooled procurement
Comp. sealed bidding Competitive bidding
Purchase
Bid Emergency purchase Ordering Contracts
Order; Notice End-users Submit Award (3-year validity)
viewing
to Proceed (DoH/LGU) quotation Suppliers
Manufacturers, Suppliers
For approval Suppliers, Distributors,
Contractors, LGU
Suppliers Consultants warehouse
PhilHealth
Central Warehouses Suppliers distribution
PCB-2
(managed by LMD of DoH) (Breast Cancer MAP) In-house/
Outsourced
distributor
3PL Regional Office Pilot
Q3M
(for buffer stock) 3 chains of a
Access sites private retailer
RHUs
(hospitals)
Consumers 24 of 31
Medicines provided by DoH: ComPacks; Medicine Access Programmes (MAP)
Status
No. Medicines in PNDF 2008
DoH (ComPacks)
HYPERTENSION
ACE Inhibitors
1. Tab. Captopril 25mg, 50mg
- Only Enalapril
2. Tab. Enalapril 5mg, 10mg, 20mg
ARBs
1. Tab. Candesartan 8mg, 16mg
2. Tab. Eprosartan 600mg
3. Tab. Irbesartan 75mg, 150mg, 300mg
- Only Losartan
4. Tab. Losartan 50mg, 100mg
5. Tab. Telmisartan 40mg, 80mg
6. Tab. Valsartan 80mg, 160mg
DIABETES
1. Tab. Metformin 500mg, 850mg, 1000mg - Included
2. Human recombinant insulin, intermediate acting (100 IU/mL, 3mL) - Not included
3. DPP4 inhibitors none mentioned - Not included
4. Insulin analogue, long acting none mentioned - Not included
BREAST CANCER DoH (MAP)
Tab. Tamoxifen 10mg, 20mg, 30mg, 40mg - Included
COLON CANCER DoH (MAP)
Tab. Capecitabine 150mg, 500mg - Does not cover colon cancer
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Philippines Private Procurement and Supply System

Pharmaceutical companies
Wholesalers/Distributors
(Local and MNCs)

Private Primary Care Private Community

Clinics Pharmacies

Consumers

Legend
Drug Order and Circulation

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 Supply System Performance: Philippines
STRICT PRE-REGISTRATION QA
NO COORDINATION between
LACK impact from pricing policies programmes and logistics
MINIMAL competition DELAY up to a few months
1 UNKNOWN frequency of site audits
MARKET LACK of public health pharmacist
function

2 3 4
PROCUREMENT DISTRIBUTION DELIVERY
FUNDS

CLEAR & FOCUSED National

Medicines Policy MULTIPLE information system
initiatives
OVERLAPPING functions within
MULTIPLE government agencies STOCKOUTS & WITHHOLDING
NO integrated Logistics of medicines
Information System LACK of supervised dispensing
NON-COMPLIANCE of INEQUITY of facility distribution
procurement timeline 27 of 31
 KEY MESSAGES

Enablers Barriers
DIVERSIFY distribution LACK specialisation
means Provision
Reach remote places Regulation/Monitoring
Calculate costs based on
evidence LACK supervised dispensing
INTEGRATE logistics Safety compromised
management information LIMIT professional autonomy
system
Provide information
PROMOTE competition
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 KEY MESSAGES

Problem Areas Actions for ADB

Distribution capacity Policy loans
Hard to reach remote places Human resource development
High distribution costs for Quality Assurance
Institutionalisation of HTA
Scarcity of information
Quality assurance Investment
Forecasting Logistics information system
Example: mSupply by NZ-based
Lack of enforcement SustainableSolutions
Pricing policies Innovative distribution means
Competition Drones. Example: Zipline
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 Limitations
Different sources of data
Mostly grey literature

Dynamic nature of health care system

Limited to few classes of medicines

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 Acknowledgements
Dr Eduardo Banzon
Dr Klara Tisocki
Dr Douglas Ball
Dr Soccoro Escalante
Interviewees

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