Transcript The Pharmaceutical Market in Mauritius

The Pharmaceutical Market in Mauritius :
a Case for Stronger Regulation
Mosadeq Sahebdin
Introductory remarks
For a population of 1.2 million inhabitants,
Mauritius has a high consumption rate of
pharmaceutical products.
 The Mauritian population is known to be
heavy drug users, due to the high rate of
self-medication and the a pill for every ill
mentality.
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% on GDP
At present, Mauritius spends about 2.8
percent of its GDP on health.
Comparable figures for other countries are
shown in following table.
% of GDP on Health
14.0
12.0
% GDP
10.0
8.0
6.0
4.0
2.0
0.0
Madagascar
Mauritius
Singapore
Seychelles
UK
New Zealand
Belgium
France
USA
Health services
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At The state health services employ over 650 doctors and
17 pharmacists.
primary care level, the state health services have 134
facilities.
There are 5 regional hospitals and three district hospitals.
The private sector absorbs 32% of the total expenditure on
health, employs over 400 doctors and provides primary
and secondary services with 14 private clinics, 20 private
medical laboratories and 275 private pharmacists.
Health professionals
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At the end of 2001, there were in Mauritius 1,107
doctors, that is one doctor for every 1,089
inhabitants.
694 (63%) were working in the public sector, and
of these, 245 were specialists.
There were 245 pharmacists, that is one for every
4,920 inhabitants.
17% were working in the public sector.
Health Status
According to a WHO report ,
 9.3% of adults aged 18 and are diabetics
 7.4% have arthritis
 6.4% suffer from depression
 4.6% have asthma, and
 4.3% have cardiac ailments.
 These figures explain the high drug
dependency among the population.
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Expenses on health
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32% of Mauritian households have to borrow or
sell personal expenses to meet for medical
expenses.
29.6% spend from their personal savings.
For 9% , the health expenses exceed their
affordability by 40%.
41.8% of expenses on health are used to buy
drugs.
Price Control
The prices of drugs are controlled by the
Ministry of Industry and Commerce.
 Government has fixed profit margins for
importers and retailers respectively.
 Importers are allowed a profit margin of
9%, and 22% goes to retailers.
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Price fixing method
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The prices of drugs used to be fixed on a six
months’ basis. The method known as stabilising
account allowed operators to recoup losses relative
to fluctuations in exchange rate and enabled
consumers to benefit from a specific price for at
least six months.
Government has now adopted the consignment
basis method, enabling prices to be revised on each
consignment.
Market concentration
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The root cause of high prices of drugs in Mauritius
is the lack of competition on the market.
Big companies, representing multinationals tend to
practice exclusive selling.
They make an abuse of their dominant position.
They can exert an influence on the variety of drugs
sold by the pharmacists.
Doctors tend to prescribe exclusively brand names.
Over-invoicing
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Importers may claim, in invoices submitted
to the price fixing unit, expenses which they
may not have effected.
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Such practice has led to the setting up of socalled black funds within companies.
Irrational prescribing
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Irrational prescribing is one of the causes of the escalation
of pharmaceutical budgets.
Such practice include:
the heavy dependence of some prescribers on drug
treatment for minor self-limiting complaints,
over prescribing of certain types of drugs,
prescribing of drugs of limited or no clinical value such as
anti-diarrhoeals,
prescribing expensive drugs when comparable but cheaper
drugs are available and prescribing expensive brand forms.
Anti-competitive behaviour
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Companies often influence doctors and
pharmacists with huge incentives.
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Prescribing brand names and the sale of same
are related to unfair promotional practices,
such as offering gifts to doctors.
Pushing expensive drugs
The profit margins tend to cause
pharmacists to push brand names.
 Parallel importers also suffer from this
preference for brand names.
 Pharmacists would not often stock these
products on the grounds of sub-standard
quality, although what deters them is the
low profit.
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Consumer behaviour
Consumer behaviour tends to encourage
this situation.
 The high rate of self-medication is related
to the high drug dependency.
 Another factor is the consumer perception
that the more expensive the product the
more efficient it is.
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Unethical practices
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These include :
aggressive advertisement on food or vitamin
supplements,
the free sale of prescription-only drugs, and
doctors establishing their practice on the premises of
pharmacies in violation of the Pharmacy Act.
Such unethical and illegal practices are equivalent to
unfair competition.
Regulatory framework
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Drugs prices are fixed by the Price Fixing Unit of
the Ministry of Industry and Commerce.
Enforcement of the Pharmacy Act is the
responsibility of the Pharmacy Board.
Import permits are delivered by the Ministry of
Industry and Commerce, upon recommendations
from the Trade and Therapeutics Committee.
Recommendations
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There is an urgent need for the formulation
of a National Drugs Policy.
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The WHO Essential Drugs List should be
used as a tool to curtail high drug prices.
Recommendation (contd)
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A civil society network will contribute to further consumer
awareness on rational drug use and bring a change in
mentality.
The setting up of a regulatory mechanism is becoming
urgent.
Such a regulatory authority would include a mechanism to
regulate behaviour of doctors, as well as distributors,
including pharmacists at the retail level.
Government’s proposal to set up a Pharmacy Council to
regulate the activities of the profession and establish a Code
of Ethics is noteworthy.
Acknowledgements
Ministry of Health, White Paper for the Health Sector Reform,
Government of Mauritius, 2003.
 Dr K. Balasubramanian, Health and pharmaceuticals in Developing
countries: Towards social justice and Equity, Consumers International,
1996
 Nitya Nanda and Amr Ullah Khan , Competition Policy for the
Pharmaceuticals Sector in India, Towards a Functional Competition
Policy for India, an overview, edited by Pradeep S. Mehta, CUTS
International,
 L’express newspaper.
 ICP Press releases.
* The author is the Coordinator of the Institute for Consumer Protection,
Mauritius.
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Thank you