Cookies?
Library Header Image
LSE Research Online LSE Library Services

Essays on prices, volumes and policies in generic drug markets in high- and middle-income countries

Wouters, Olivier J. (2018) Essays on prices, volumes and policies in generic drug markets in high- and middle-income countries. Doctoral thesis, Social Policy.

[img] Text (Wouters_essays_on_prices_volumes_and_policies_published) - Published Version
Repository staff only until 7 December 2019.

Download (2MB) | Request a copy

Identification Number: 10.21953/lse.ppv5qzbr6y8s

Abstract

Background and importance: Rising drug prices are putting pressure on health care budgets. Policymakers are assessing how they can save money through generic drugs. Objective: The aim of this Ph.D. was to explore issues relating to the prices and usage of generic medicines in high- and middle-income countries in five articles. This was done using quantitative and qualitative methods, including price and Herfindahl-Hirschman indexes, difference-in-differences regression analyses, semi-structured stakeholder interviews, and literature reviews. As a Ph.D. “thesis by papers”, each of the five articles should be read as a stand-alone piece. However, the thesis presents an overarching narrative, outlined at the end of Chapter 1. Novelty and empirical contribution: My original contributions to knowledge are: (i) updated analyses of generic drug policies, prices, and usage rates in high-income countries, based on a large, representative sample of generic medicines from 2013 (Chapters 2 and 3); (ii) evidence on the impact of a pharmaceutical tendering system on medicines prices, demand, and competition over a 15-year period (Chapter 4); (iii) quantitative data on the impact of therapeutic tendering on drug spending and prices (Chapter 5); and (iv) qualitative data on how a country can move from a fragmented health-care system to a single-payer one, using tendering as the basis for a comprehensive drug-benefit plan (Chapter 6). Key findings: The prices and market shares of generics varied widely across Europe. For example, prices charged by manufacturers in Switzerland were, on average, more than 2.5 times those in Germany and more than 6 times those in the United Kingdom, based on the results of a commonly used price index. However, the results varied depending on the choice of index, base country, unit of volume, method of currency conversion, and therapeutic category. The results also differed depending on whether one looked at the prices charged by manufacturers or those charged by pharmacists. The proportion of prescriptions filled with generics ranged from 17% in Switzerland to 83% in the United Kingdom. The results of the first two studies indicated that the countries which used tender or tender-like systems to set generic drug prices in retail pharmacies (ie, Denmark, Germany, the Netherlands, and Sweden) had among the lowest prices among the countries included in the studies. Tendering can be an effective policy to procure essential medicines at low prices, based on analysis of data from South Africa and Cyprus. For instance, the average prices of antiretroviral therapies, anti-infective medicines, small-volume parenterals, drops and inhalers, solid-dose medicines, and family-planning agents dropped by roughly 40% or more between 2003 and 2016 in South Africa. Many tender contracts in South Africa remained competitive over time, based on the Herfindahl-Hirschman results, with some notable exceptions. However, the number of different firms winning contracts decreased over time in most tender categories. Also, there were large discrepancies between the drug quantities the health ministry estimated it would need to meet patient demand and the quantities the ministry went on to procure during tender periods. In South Africa, the introduction of therapeutic tendering was associated with an estimated 33% to 44% reduction in the prices of solid-dose drugs in 2014. National governments in countries aiming to introduce national health systems (eg, Cyprus and South Africa) will need to adapt their tendering systems and other pharmaceutical policies during transition periods. Future research directions: More research is needed to better understand the drivers of differences in generic drug prices between countries. It is also important to examine why there are large differences in the prices of drugs in various therapeutic areas, both within and between countries. Also, data from more countries, especially low- and middle-income ones, are needed to determine which features of tendering systems are associated with lower prices. Future studies should re-examine the South African therapeutic tendering system once data from more post-intervention periods are available, possibly using other research designs like interrupted time-series models (ie, segmented regression analysis). Policy implications: Price indexes are useful statistical approaches for comparing drug prices across countries, but policymakers should interpret price indexes with caution given their limitations. This thesis offers useful data for policymakers using, or planning to introduce, tendering systems, especially in countries aiming for universal health coverage, like Cyprus (Chapter 6) and South Africa (Chapters 4 and 5).

Item Type: Thesis (Doctoral)
Official URL: http://www.lse.ac.uk/social-policy
Additional Information: © 2018 The Author
Divisions: Health Policy
Subjects: R Medicine > RA Public aspects of medicine > RA0421 Public health. Hygiene. Preventive Medicine
H Social Sciences > HB Economic Theory
Date Deposited: 02 Aug 2019 12:18
Last Modified: 02 Aug 2019 23:13
URI: http://eprints.lse.ac.uk/id/eprint/101287

Actions (login required)

View Item View Item

Downloads

Downloads per month over past year

View more statistics