To Address Africa’s Chronic Disease Burden, We Need To Talk About The Cost Of Medications.
There is no doubt that Africa is about to witness a healthcare boom. As McKinsey indicated in this report, the size of the pharmaceutical market grew from $4.7 billion in 2000 to $20.8 billion in 2013 and it is expected to reach between $45 billion — $65 billion by 2020. This is an impressive growth rate but it should not come as a surprise.
For decades, the healthcare focus has been on fighting communicable diseases yet in the last decade and half, we have seen a rise in non-communicable diseases like hypertension, diabetes, cancer and cardiovascular indications as a leading disease burden on Africa’s healthcare system. In 2005, the World Health Organizations released a comprehensive report on the state of Chronic diseases globally. For every 5 persons suffering from a chronic disease, 4 are from low and middle income countries. In Nigeria, there is a 20% probability of dying from the 4 main NCD’s (Cancer, Diabetes, Cardiovascular diseases and chronic respiratory diseases) between the ages of 30 -70.
To solve what the WHO calls the “invisible” epidemics, we need to develop massive interventions which would require support from both public and private sector stakeholders. However, I would like to write about one of such interventions which is of particular interest to me because of the work we do at mPharma. This is the cost of medications. Simply put, the cost of high quality medications in several African countries for chronic diseases are outrageous. A study done by one of our pharma partners showed that the margins on their products from the manufacturer price to the retail price was over 200%. The unintended consequences of high drug cost means patients on chronic medications cannot continue to pay for drug refills so they stop taking them or are pushed to inferior alternatives.
Even when pharma companies have reduced their manufacturer price to increase medication access, these reductions have not been passed on to patients. Another pharma partner reduced the price of one of their products by 40% but it lead to no material change in the retail prices. These setbacks have led a lot of pharma companies to rethink their distribution models. It is not good enough to simply make your products available in the market or try to convince doctors to prescribe your products. Pharma companies need to get involved in the last mile of the drug supply chain which is the retail outlet. They need to transition from market access to patient access solutions.
At mPharma, we think a lot about how we can build solutions that enable patients to purchase high quality medications at affordable prices. We started off by developing an e-prescribing technology that lets doctors know in real-time the exact location and availability of any medicine of interest. Recently, we have been working on a solution (which we will soon announce) that will allow patients to enroll in a subscription service for their drug refills, thus, cutting out unnecessary margins on high quality branded and generic drugs.
We spend a lot of time talking to doctors about how they decided which medicine to prescribe and one of the reasons that always come up is the cost of the drug to the patient. So i always tell our pharma partners, you can do all the eDetailing in trying to convince doctors to prescribe your products but if you fail to address the cost issue, you will price yourself out of the market.
We hope that once we launch our Patient Access solution in the coming months, we can help bring down the cost of selected high quality medications for patients.