A GROUP of 23 non-governmental organisations (NGOs) and 28 concerned individuals have questioned a study sponsored by the private healthcare industry dubbed Cost-Benefit Assessment (CBA) 2.0 on the impact of the Medicines Price Regulation (MPR) policy.
The group claimed that the CBA 2.0 study’s preliminary findings entirely overlook the role of and benefits to patients, their family members and support groups as well as consumers.
It also expressed concern over the serious conflict of interest in this public-private sector collaboration project because the CBA 2.0 is funded by the healthcare industry with some of its members even sitting on oversight committees.
The public sector participants are the Ministry of International Trade and Industry and the Malaysian Productivity Corporation while the private sector is represented by the Pharmaceutical Association of Malaysia, Association of Private Hospitals Malaysia, Malaysian Organisation of Pharmaceutical Industries and the Malaysian Medical Association.
“Public interest and public health must come first before the private healthcare sector’s goal of maximising profits,” the group pointed out in a statement.
Notable members of the group include the People’s Health Forum, Third World Network, Parti Sosialis Malaysia (PSM), All Women’s Action Society (Awam), Aliran, Consumers’ Association of Penang (CAP), Sahabat Alam Malaysia (SAM) and Women’s Aid Organisation (WAO).
While CBA 1.0 had studied the impact of regulating single-sourced prescription medicines – about 600 active substances that are usually the most expensive due to the monopolistic nature of the market – CBA 2.0 studied the policy impact related to 5,000 pharmaceutical products, details of which are not disclosed.
“As a result, the exaggeration of the price impact is a real problem. Why did CBA 2.0 enlarge the scope and automatically assume the implementation of subsequent phase(s)?” asked the group.
“Furthermore, CBA 2.0 claims that 33% or 2,600 private clinics will close due to the impact of the new policy. How does the study arrive at this number? Most private clinics do not even sell or rely on the sale of the 600 listed single-sourced medicines in the first phase of the proposed medicine price regulation policy.”
Moreover, CBA 2.0 also claims that private hospitals’ revenue will drop by 35% to 40% due to the implementation of the proposed policy which is “another problematic exaggeration”, according to the group.
“Private hospitals had contributed a total of RM14.55 bil in health expenditure in 2020 (Malaysia National Health Accounts 2020 preliminary data). A 35% revenue drop would be a shocking RM5 bil per year!” the group reckoned.
“If this claim were true, this would represent an obscene amount of excess profits that they would have profiteered from the sale of medicines alone.”
Therefore, the group strongly urged the Government and general public not to give weight to the preliminary findings of the CBA 2.0 study but to implement the cabinet-approved policy for the first phase that has already been delayed for the following additional reasons:
- First, 35% or RM23.15 bil of total healthcare expenditure had come from out-of-pocket expenditure in 2020, of which 15% (or RM3.39 bil) were for pharmaceutical purchases. The compound annual growth rate (CAGR) of the out-of-pocket expenditure is at 7.28% from 2010-2020 which means that the out-of-pocket expenditure is growing faster than the gross domestic product (GDP).
- Private hospitals alone have already taken 45% share of out-of-pocket expenditure. If the Government does not intervene, this expenditure could continue rising and maybe faster, due to the high mark-up practice for the medicines.
- Secondly, people are already hit hard by the COVID-19 pandemic with major job losses among the bottom 40% and middle 40% populations. With the current high prices of many essential goods and services already causing hardship, people should not be burdened even more with expensive medicines. – Dec 28, 2021
