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Zimbabweans are paying far more than they should for medicines, both prescription drugs and over-the-counter medicines, both of which have to be dispensed by a licensed pharmacist who obtains them from a licensed wholesaler, manufacturer or importer.
It is ever more obvious that the mark-ups, especially at the import and wholesale level, are extremely high by regional standards and while mark-ups at the retail level can be horrific, there is enough competition to give those needing medicine a lot of choice, and so long as they shop around, they can find fairer pricing.
What is now needed is to either allow a lot more competition at the importation and wholesale level, breaking de facto cartels, or work out ways of restoring local manufacture or packaging of a wide range of essential drugs, or creating a single national annual tender for almost all drugs placed through NatPharm
The prices of prescription drugs are far more uniform than the prices of over-the-counter drugs, although generally significantly higher than prices of similar or identical drugs in neighbouring countries.
Both the high price and the greater uniformity in prices arise from what could be described as a cartel or monopoly on generic drugs.
Generics are always cheaper than the original brand-name drug of the patent holder, and sometimes a small fraction of the price.
As a patent on a drug expires, other manufacturers are able to follow the original biochemical processes and make the identical drug.
India is the dominant manufacturer of generics, thanks to a high-class pharmaceutical industry and a regulatory regime that ensures the output of the generics is consistent and meets quality standards, making it relatively cheap to register these drugs in other jurisdictions, including Zimbabwe.
Unfortunately, there are exclusive agency agreements with many of the major Indian suppliers, giving the holder of those agreements what amounts to a monopoly on the best source of generics.
It was pressure from the importers that forced pharmacies and hospitals to charge for drugs in foreign currency for a while and when that was made illegal, they were forced to switch to black-market exchange rates, or more precisely what the black market exchange rates are expected to be in a month’s time, with a deeply pessimistic view taken.
It is quite possible to buy the identical generic drug in Musina, South Africa, or Blantyre, Malawi, at a significantly lower price, and there are a growing number of Zimbabweans with chronic complaints, and who can thus plan their drug purchases months in advance, to take a bus across the border to stock up.
There are no customs duties on medicines.
Over-the-counter medicines have a greater range of suppliers, and this can be seen in Zimbabwe pharmacy prices where the cheapest brand can be less than half the price of the most expensive.
Competition at importation and wholesale level thus can make a significant difference.
A third problem driving up prices is the heavy-handed regulation of the Medicines Control Authority of Zimbabwe (MCAZ). Every dose size of every brand of every drug has to be registered. And in a market as tiny as Zimbabwe’s, this can add a hefty premium to drug prices.
While Zimbabweans cannot be fobbed off with rubbish, and while drugs need to be monitored, it would seem an acceptable compromise would be a cheap and automatic registration for drugs, brands and pill sizes that have already been registered in an approved jurisdiction.
We do not have to pretend we are totally independent.
At the retail level, there is some completion despite the lists of recommended prices.
Shopping around is certainly advised.
Those pharmacies that do not accept medical aid cards, although ensuring that their customers know how to claim refunds and sometimes even delivering the forms, are frequently cheaper.
Pharmacies with lower overheads, such as rent or auxiliary staff, can also offer lower prices.
The huge size of the retail sector, with a pharmacy on almost every block in the central business districts of cities and several in many suburban shopping centres, allows easy comparison shopping.
For some drugs, it is possible for pharmacies to go for direct imports.
More could do this if the drug registration process was made more flexible and drugs approved, say in South Africa or for the British National Health Service, could be automatically registered in Zimbabwe unless there was a valid objection.
The British source, incidentally, is worth pursuing since 90 percent of British drugs are dispensed through the national service and for many generics, there is a national tender, ensuring the lowest viable price.
But reforms in Zimbabwe will need Government and probably legislative action.
Besides the licensing requirements, action could be taken to prevent sole agencies in the pharmaceutical field. Once a particular drug can be sold in Zimbabwe, then anyone should be allowed to import.
The most radical solution would be to go for national tenders, combining requirements of both the public and private sectors, a British style solution.
This could start with drugs on the essential drug list and be expanded later.
This would create the largest possible market and if tender contracts were for, say, three years, then this would provide security for local manufacture, mixing or packaging plus force major international generic suppliers to calculate discounts and other lowering of costs while still remaining viable.
But whatever solution or set of solutions is chosen, what cannot be allowed is the present system. Retail price controls are not needed.
What is needed is a way of getting cheaper drugs into the supply chain, which does require Government action on several fronts, and then allowing the intense market competition at the retail level to drive prices down further.
Online Reporter