NCDs and SDGs #10 and #12: Show Us the Money! How Greater Drug Pricing Transparency Could Fund Innovation and Improve Access to Medicines:



Can you afford to be healthy?

The health and well-being of all global citizens is supported by the United Nations Sustainable Development Goals. However, inequalities – both within and between countries – mean that some individuals are able to access the services and products that encourage health more than others, a fact recognized by SDG 10 (“Reduce inequality within and among countries”), as well as SDG 12 (“Ensure Sustainable Consumption and Production Patterns”). Rising prices have reduced low-income countries' and individuals of low socio-economic status' ability to access many necessary medicines. People living with chronic diseases, who often pay exorbitant prices over long periods of time, are particularly vulnerable to growing costs - but increased drug pricing transparency can help.

Prices of many medicines have increased substantially in recent years. In some cases, the price of old drugs sky-rocket with no apparent reason. When the drug company Mylan purchased the rights to EpiPen in 2007, the product sold for roughly $57 USD in the United States. Prices now exceed $600 USD for a pack of two (the only way EpiPens are sold), despite the fact that the product has not changed since 2007.

In other cases, new medicines launch into the market with overwhelming initial price tags. When drug maker Gilead introduced their new drug for Hepatitis C, called Solvadi, a treatment sequence came with the whooping price tag of nearly $65 000 USD. According to a 2015 study of 26 OECD countries, the cost of this Hep C treatment worldwide was equivalent to between 2.5 months’ to more than 5 years’ average annual wage, depending on the country.

In the face of such high figures, we know little about the way drug companies arrive at these prices. The amount companies spend on drug research and development (R&D) is kept private, despite the fact that companies often cite high R&D costs as the reason for high medicine prices; estimates of the average cost to bring a new drug to market range widely, from $100 million to $1.4 billion. Like a car salesperson, drug providers also set public list prices of their medicines (like a “sticker price”) but offer coupons and discounts of uncertain quantities to buyers. This means that the actual prices paid for medicines can vary drastically from the list prices, and differ between consumers regions, and countries.


So, how can transparency help tackle exorbitant drug prices and improve access to medicines?

In brief, if the public, buyers, and policy-makers knew how much it cost to make, market, and distribute a drug, we could make informed decisions about the appropriate amount to pay to simultaneously fund innovation and ensure equitable access to medicines – particularly for our most vulnerable people and those living with expensive chronic conditions.

With more transparent information, government and private buyers could enter into informed negotiations with drug companies, knowing how much the company sold the product to other countries and customers. Watchdog organizations could easily track and flag unfair price increases. Shareholders could ensure that companies aren’t spending unnecessarily during drug development or marketing.

More transparent information would also open the door to discussions about separating the price of medicines from the financial resources required to fund innovation (an approach known as “de-linkage”). This and other novel forms of R&D financing may represent the future of more equitable drug development.

And what would this kind of transparency look like? Various groups, from the United Nations’ High-Level Panel on Access to Medicines, to smaller organizations like the Campaign for Sustainable Rx Pricing all point to similar recommendations. Namely, we need publicly available information on:

-The costs of drug research and development, including clinical trial information;

-Actual prices paid by consumers; and

-The amount of public funding received by a drug maker.

We can achieve drug pricing transparency. Better information has the potential to drastically improve access to medicines across the globe, and ensure that necessary drugs make it into the hands of the people who need them most. What are we waiting for?

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Nicole Markwick

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NCDs and SDGs #10 and #12: Show Us the Money! How Greater Drug Pricing Transparency Could Fund Innovation and Improve Access to Medicines:
NCDs and SDGs #10 and #12: Show Us the Money! How Greater Drug Pricing Transparency Could Fund Innovation and Improve Access to Medicines: