For a long time now, India has been struggling with access to good quality and affordable medicines as current barriers push 3 percent of its citizens into poverty every year. According to the Economic Survey 2023, the share of out of-pocket-expenditure or OOPE in healthcare is 48.2 percent of the total expenditure. This is much higher than the global average of 18 percent as of 2019.
In March 2022, a WHO report estimated that high OOPE on health is impoverishing some 55 million Indians annually, with over 17 percent households incurring catastrophic levels of health expenditures every year. Medicines constitute 20-60 percent of total healthcare expenditure, which is why affordable medicines/generics have a huge role in breaking this vicious cycle of high disease burden, household incomes and poverty, and making healthcare affordable for patients.
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Over the last two decades, our existing disease burden is being compounded by the rising incidence of lifestyle and non-communicable diseases such as diabetes, cancer, hypertension and heart diseases. There is a growing segment of middle-aged and senior citizens being afflicted with chronic ailments which need branded, expensive medications that are usually not covered by health insurance. These lifestyle diseases are also affecting poor and marginalised sections of population in a disproportionate manner compounding their problem of access to affordable health care.
On the vaccine front, India has made some impressive gains during the Covid pandemic in ensuring access to indigenous vaccines not only to its own people but to other countries also. By the end of 2021, it had supplied more than 72 million doses of COVID vaccines to almost 100 countries. Many preferred the Indian vaccine due to its low-cost and ability to make large-scale export consignments, besides effectiveness.
Vaccine Maitri was a huge relief for low-income countries that could not compete with richer nations for vaccine procurement during the pandemic. It was similar to India’s efforts at the turn of the millennium to supply to the world, affordable antiretroviral drugs for HIV after global pharma majors had priced them exorbitantly. It saved millions of lives, most of them in Africa, by bringing down the cost of treatment substantially. Today, India is the largest vaccine supplier, for polio, diphtheria, measles, mumps, and rubella that are used by 170 countries for their immunisation programmes.
Accessibility & Affordability
The higher price of branded generic drugs as compared to unbranded counterparts, limits access to reasonably priced drugs in India. To address this gap, the Government launched the Jan Aushadhi scheme in 2008 to increase access to affordable and quality medicines through dedicated stores.
The scheme included setting up pharmaceutical stores with government support and making cheaper drugs available to consumers. There are currently over 9000 Janaushadhi Kendras functional across the country; the product basket of Pradhan Mantri Bharatiya Janaushadhi Pariyojana (PMBJP) comprises 1759 drugs and 280 surgical items available to the public at affordable rates, and it has achieved sales of Rs 1236 crores last year, while registering buoyant growth each year.
According to a study on accessibility, affordability, and quality of medicines in India, 18 percent of OOPE incurred by households is for in-patient treatment while 82 percent is for out-patient care. This suggests that the cost of pharmaceuticals provided as outpatient care is an important area for policy intervention. Drug accessibility is inseparable from affordability because affordable medicines lessen the financial burden on households. The easy availability of generics reduces reliance on expensive alternatives, and good-quality drugs are the minimum requirement for effective treatment.
Price control is also a chosen policy instrument of the government to keep drug prices low in the country. In November 2022, the Union Health Ministry notified 384 important lifesaving drugs and brought them under price control and mandated all hospitals to keep a bulk stock of these drugs.
Way forward
In order to increase the accessibility of medicines, the Bureau of Pharma PSUs of India (BPPI) should provide more incentives to open Jan Aushadhi stores with targeted incentives to expand stores located in rural areas, and in less developed districts specially focused on poor and marginalised sections of society.
There should be more strategic price controls on drugs. It is a double-edged sword that should be carefully used, keeping in mind the two objectives - the growth of the industry (innovation and investment) and the interest of consumers. A price ceiling that is too low can disincentivise firms from joining or continuing to operate in the market. An increase in generic prescriptions will not only create more demand and competition among the generic producers but will benefit consumers.
There is clearly a need to keep the focus on the twin crucial issues of access and affordability for India as we move into a post-pandemic scenario. At the policy level and in trade negotiations as well, India must leverage its new positioning and G20 presidency to advocate for, and support measures, to keep therapies and solutions accessible and affordable for patients. India must address issues of patents and IP rights and oppose any measures to limit waiver of patents on vaccines, drugs and equipment “only to vaccines” and also not accept any pre-conditions on vaccine exports. India is already WTO TRIPS compliant and all provisions under the Patent Act are aligned.
Low medicine prices help save lives in vulnerable communities across the world. Keeping global supplies of generic medicines in mind, India should utilise its newfound positioning as G20 Chair, be vigilant and not allow barriers to affordable medicines to be included in free trade agreement negotiations. Now that India has become the world’s most populous country, it is all the more imperative that the Government finds ways to ensure that quality medicines remain accessible and affordable to the large section of poor and marginalised sections of population both within the country and outside.
—The author, Dr JVR Prasada Rao, is Former Health Secretary, Government of India. The views expressed are personal.
(Edited by : C H Unnikrishnan)
First Published: May 8, 2023 10:23 AM IST
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