By Macon Ramos Araneta

TAGAYTAY CITY—The country’s pharmaceutical industry has grown by over 230 percent from P47 billion in 1999 to nearly P150 billion today but remains in the stranglehold of multinational companies which control at least 70 percent of the market.

Health Undersecretary Mario Villaverde told a seminar for media at the Hotel Dominique here that drug prices in the country are among the highest in Asia. The price of medicines in the Philippines is 3.4 to 184 times the international reference index.

He said the pharmaceutical market is dominated by expensive branded medicines and drug distribution is controlled by a few big distributors even if the Filipinos have the highest per capita consumption of pharmaceuticals in Southeast Asia—about P750 to P800 is spent on drugs and medicine per person annually or nearly 45 percent of their personal expenses.

Villaverde said because of the dominance of multinational companies, generic medicines—which are of the same quality and potency as the more expensive branded medicine—account for only 4 percent of the market.

“This shows that there are significant problems in the access to medicines by the poor,” Villarverde said.

The health official said most of the sales are generated by wholesale and retail drugstores accounting for 85 percent of all drugs sold in the country with the rest served by private and government hospital pharmacies.

“Private hospitals also exercise market power when they discourage patients from purchasing drugs from outside,” said Villaverde.

He noted the dominance of a single retail chain for most of the big commercial outlets in large urban centers while single proprietors and community-based, non-government organizations owned most of the small outlets in rural and small urban communities.

Villaverde said authorities are focusing on how to make low-priced but quality drugs and medicines available nationwide at half their 2004 base prices.

He said the strategic thrusts to reduce medicine prices consist of encouraging partnership with the local pharmaceutical industry, creating a regulatory environment that will ensure fair competition, encouraging greater use of generic products, and supporting community-based initiatives such as the Botika ng Bayan and Botika ng Barangays.

Reforms in health regulations will include harmonizing and streamlining licensing, accreditation and certification systems, developing a “seal of approval” system on health products, establishing a one-stop shop for licensing of health facilities, automating regulatory systems and processes, pursuing cost recovery and income retention for regulatory agencies and assuring the availability of quality and affordable medicines.

“If there is lesser administration costs, the investment will be lower and this eventually result to lower cost of health goods and services,” Villaverde told reporters.

Villaverde also said access to low-priced quality essential medicine shall be assured by expanding pharmaceutical distribution networks, identification of alternative local and foreign sources of low-priced pharmaceutical products, and developing mechanisms for pooled procurement among health facilities and across LGUs to realize economies of scale.