The Cost of Drugs: Beyond the Supreme Court Order -Sanjay Nagral

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published Published on Apr 27, 2013   modified Modified on Apr 27, 2013
-Economic and Political Weekly

While the Supreme Court decision in the recent Novartis case has cleared the way for production of generic drugs in India, doctors have to prescribe cheaper alternatives to costly brands if patients with limited means are to benefit. What is being hailed as a victory in the struggle for affordable medicines in the country will actually be one only when there is a pro-patient slant to the prescription process.

Sanjay Nagral ( is a surgeon who consults at the Jaslok Hospital and Research Centre, and the KB Bhabha Municipal General Hospital, Mumbai.

Mr P is an elderly, retired gentleman who suffers from a rare tumour of the stomach called a GIST tumour, which I operated upon last year. Following the surgery, he was advised to take the drug imatinib to reduce the chances of a recurrence of the tumour, a strategy that is very effective. Yes, this is the same drug that the Supreme Court gave a judgment on in the now well-known Novartis case. Imatinib, better known by its brand name Glivec, is usually used for chronic myeloid leukaemia, a form of blood cancer, but it is also very effective for GIST tumours.

Mr P came to see me last week for a follow-up visit. I asked him, "Which brand of imatinib are you taking?" "Glivec" was his prompt reply. "But isn't it costly? Why have you not chosen the generic brand that is much cheaper?" I asked. Mr P paused, smiled wryly and said, "I was advised by a senior cancer specialist that the cheaper brands are no good. I have exhausted all my post-retirement savings, but what can I do? How can I compromise on quality?" After some discussion and goading, I managed to convince him that he should switch to the cheaper brand. I suspect he may have, but am not sure.

Complex Game of Prescriptions

The Supreme Court judgment on Glivec has been hailed as a major "victory" in the struggle for affordable medicines in India. The dramatic price difference between the Novartis drug and its generic version, and that it is a cancer drug, lent the case high visibility in the media and the public eye. However, as Mr P's case illustrates, if we scratch a little deeper, we discover that how a patient gets a particular brand of a drug in India is a complex game with many layers and players. Before we get carried away by euphoria over the Supreme Court judgment, if the broader focus is on reducing the cost of drugs, we must attempt to unpeel some of these layers. What is at stake is not a theoretical debate about patents, intellectual property, and innovation, but the affordability of drugs on a day-to-day basis.

While Glivec is used in a few rare cancers, there are many more drugs used in common illnesses that are available in multiple brands with a very wide price range. So what determines how a particular brand of a drug is prescribed for a patient in India? The person who presently determines the brand is the doctor who prescribes it. So we need to examine how an average doctor in India, given a wide variety of choices, chooses to prescribe a particular brand. This is a difficult process to unravel and there is only anecdotal evidence. The choice of brand that a doctor chooses could be based on perceived quality, familiarity, marketing, availability, incentive, and perhaps affordability. Often it is a mixture of all of these, making the decision subjective and in a sense arbitrary. Some of these are conscious choices, but others may be subconscious decisions influenced by powerful branding and marketing. Thus, while it is commonsensical to assume that an average doctor will always factor in price and affordability when choosing a brand, especially since healthcare in India is costly and doctors struggle to get patients to complete courses of drugs, this is not necessarily so.

Example of Carbapenems

Let me make my point clearer with another example that has wider implications. There is a new class of powerful antibiotics useful in life-threatening bacterial infections called carbapenems. The original molecules made by multinationals cost around Rs 2,500 per dose of the injection. These are used three to four times a day, often for a week, which adds up to a cost of around Rs 50,000. There are now brands of the same molecules available from fairly well-established and large Indian companies that cost as little as Rs 600 per dose. So for a patient who uses it for a week, this amounts to a saving of Rs 40,000. Given the obviously limited resources of the average patient, you would expect most doctors in India use the cheaper Indian molecule. But the costly multinational brands are still the market leaders. This is true of many other antibiotics, some of them in much more common use.

Why does an average doctor, who one assumes is sensitive to the cost his or her patient has to bear, continue prescribing a costlier brand? The reasons for this are multiple. For one, there is an intuitive feeling that the original molecules, often from multinational companies, are of a higher "quality" and hence more efficacious. Company representatives are trained to subtly emphasise "purity", "quality", and "international" standards. However, to my knowledge, there are no scientific studies comparing brand efficacy. Besides, it is well known that a number of big companies get their drugs manufactured by small companies and just market them. There is now also good evidence that Indian generic formulations are effective. For example, following successful organ transplantation, patients need long-term immunosuppressive drugs, which are costly. For the last few years, many centres in India, including ours, have been using cheaper Indian brands of these drugs. These drugs are used by monitoring patients' blood levels, which gives objective evidence of their purity. And the low incidence of organ rejection is good evidence of their efficacy. This has led to huge reduction in the cost of immunosuppression after transplantation, making it more affordable to a larger section of society.

Can there be other reasons for doctors to prescribe costlier brands? There is something called "brand loyalty" and "brand familiarity", which develops over prescribing the same product for years. This is a subconscious process. Sometimes it could be just plain ignorance about the availability of a cheaper alternative that makes doctors continue to prescribe costlier brands. But one cannot ignore the role of what are euphemistically called marketing "incentives", which basically mean the inappropriate influence pharmaceutical companies exert on doctors. This runs deep. Hospitals choose to stock only certain drugs in their in-house pharmacies and insist that hospitalised patients buy drugs only from the hospital pharmacy. Drug companies sell drugs to hospitals at a price much lower than what the patient is charged, further incentivising the hospital to stock their products. The cheaper brands often get left out in this game. Finally chemists in India are known to substitute one brand for another, again based on personal incentives from companies. So drug companies, including those that assume the mantle of producing "affordable" drugs, incentivise all the players. The casualty is the cheap generic drug.

State Indifference

What has the state done to promote and create affordable quality drugs? It has policies of drug price control, but the key question worth asking again is why cannot it make drugs through its own companies? State-run companies like Indian Drugs and Pharmaceuticals Ltd (IDPL) and Hindustan Antibiotics have been allowed to run sick and produce a very limited range of drugs that are hardly marketed. Given the huge market and the inherent advantages it would enjoy, a determined state could even run profitable drug companies, as some do with public sector undertakings. In a related issue, India has the dubious distinction of having the largest number of irrational drugs and drug combinations in the market. These are freely promoted and prescribed, adding to costs and also side effects. Many companies admit that the combinations that they market in India are not a part of their international product lines. So the process of prescribing drugs in India (and to an extent in the world) has many nuances and biases. Many of these are well known and health activists have struggled over years to bring in accountability and affordability.

So while the Supreme Court has partly cleared the way for the production of generic drugs, we need to understand the larger process of drug prescription and change it to a pro-patient one if the benefit of cheap generics has to reach patients. That change can also be pushed with making prescription by generic names mandatory, as well as patients demanding cheaper alternatives. But perhaps a more difficult but effective shift would be for medical professionals to be sensitive to the cost burden their patients face. For the millions of patients in this country who often are denied appropriate and adequate care because they do not have buying power in a monetised healthcare system, this will only be one small step. But every such step is worth it for it may mean a difference between life and death.

Economic and Political Weekly, Vol-XLVIII, No. 17, April 27, 2013,

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