MOH Won’t Quit Studying Medicine Price Controls Despite Pharma Opposition

By Boo Su-Lyn | 21 October 2019

Mandatory drug price declarations may not be able to ensure full transparency, says Dr Lee Boon Chye.

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KUALA LUMPUR, Oct 21 — The Ministry of Health (MOH) will continue examining drug price controls, even though foreign drug makers warned Malaysia that such regulations could deter future investments.

Deputy Health Minister Dr Lee Boon Chye, however, welcomed the Pharmaceutical Association of Malaysia’s (PhAMA) proposal for its member pharmaceutical companies to declare their wholesale medicine prices to MOH.

PhAMA — which represents 48 local and multinational pharmaceutical companies in Malaysia — also advocated mandatory wholesale price declarations for all innovative and generic medicines available in Malaysia, beyond the 400 molecules targeted by MOH for price controls.

“We welcome efforts by the pharmaceutical or health care industry to improve transparency in their pricing of drugs, either at wholesale level or provider level (community pharmacies, private clinics, or hospitals),” Dr Lee told CodeBlue.

“Mandatory price declaration may not be able to ensure 100 per cent transparency because of other tactics like bonusing or other sales-related benefits,” he added, referring to pharmaceutical manufacturers’ practice of throwing in some free drugs upon purchase of their products.

“MOH study on price control on drugs is still ongoing and will not stop.”

Dr Lee Boon Chye, Deputy Health Minister

The deputy health minister said no timeline has been fixed to implement any drug price regulation measures.

Dr Lee added that the government was starting pool procurement of selected drugs to obtain cheaper prices for public hospitals. Currently, MOH runs its own formulary on the medicines it pays for and provides in its facilities. The MOH formulary is separate from public university hospitals that maintain their own individual formularies. Army hospitals are also run separately by the Defence Ministry.

MOH’s Pharmaceutical Services Programme said the ministry’s proposed drug price ceilings also targeted certain single-source generics, not just originator medicines.

“MOH welcomes the proposal from PhAMA and we are in the midst of reviewing their proposal and is scheduled to meet PhAMA again end of October.

“As for some generics, it is still subjected to price control because it is still a single-source and does have a risk of being monopolised,” MOH’s Pharmaceutical Services Programme told CodeBlue.

In an exclusive interview with CodeBlue, PhAMA criticised MOH’s plan to use external reference pricing (ERP) to legislate maximum medicine prices in Malaysia by comparing prices in seven to eight countries, saying that ERP is typically used by single-payer government-run health financing systems. Malaysia, on the other hand, has a dual health care system comprising both public and private sectors.

CodeBlue previously reported that the Malaysia operations of US pharmaceutical giant Eli Lilly and Company will be absorbed into distributor Zuellig Pharma Malaysia effective November 1, 40 years after the diabetes treatment maker set up its local office in 1979.

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