A Long History of National Medicines Policy:

where are we now?

Lessons from
Bangladesh National Drug Policy 1982
Continuingly Educate Physicians at
Undergraduate and Postgraduate level to
understand and remember the economics
of cost-effective, affordable quality
medicines for the people and the clever
game of pharma industries
President H. M ErshadconstitutedanExpert
Committee in April, 1982 with Dr. Nurul
Islam, Professor of MedicineandDirector of
Institute of Postgraduate Medicine and
Research (IPGMR) and 7 other members to
evaluate all drugs locally manufactured and
importedintoBangladesh
The Expert Committee had
developed 16 simple criteria of which
12 are medico-pharmacogical and 4
are politico-economic, important
ones are:
Only single ingredient products were recommended
for easy quality assurance and evaluations of side-
effects, adversereactionsandcontraindications.
* Combinations not to be allowed except for few
exceptional products such as ORS, B-complex, Iron-
folic, cotrimexazoleetc.
* No cough mixtures, throat lozenges, gripe water,
Alkalies, Tonics, Enzyme Digestive Mixtures etc has
little or no therapeutic value and creates wrong
impressioninthemindsof thepeople
Key features
Big bottles of liquid Vitamines and minerals
will not tobeallowed. However, only pediatric
dropswill beallowedin15ml bottle.
Chemicals and galenical preparations not
included in the latest edition of British
Pharmacopeia and British Pharmaceutical
Codexwill beprohibited.
Key features
Multinational companies (MNCs) are allowed to
manufacture all registered drugs except antacid
and vitamins provided they have their own
factories in Bangladesh
However, MNCs will be allowed to produce
injectable vitamins because of higher technology
No foreign brands will be allowed to be
manufactured in Bangladesh under third party
license
Key features
Imports will not be allowed if similar products are
manufactured locally
Production of basic raw materials will be encouraged
and be given protection
The Indian Drugs Act of 1940 will be amended to
incorporate to control of manufacture and sale of
Ayurvedic, Unani andHomeopathicdrugs
Recommended heavy penalty for possessing or selling
stolen drugs from the government hospitals
Key features
Physicians should not own retail
pharmacy. Registered pharmacist
should own and manage retail
chemist pharmacy shops
Key features
National Drug Control Committee for
registration of drugs, PriceControl Committee
for fixation of prices of formulation products
andrawmaterials
Review Committee for hearing appeals be
reconstituted with qualified professional
representatives of manufacturers (NOT
OWNER), medical faculties and consumer
protectionsocieties
Key features
Directorate of Drug Administration must
be adequately strengthened with
qualified human resources
(Pharmacologists, independent financial
analyst, health economists etc) to inspect
periodically all manufacturing units and
collection of samples for quality check
up and detection of fake, spurious and
substandard drugs.
Key features
Total number of registered products both
locally produced and imported from 122
foreign companies of 22 countries were 4340
of which 1742 were found to be harmful,
inappropriately formulated or
therapeutically ineffective. Out of 1742
harmful and / or ineffective drugs, 176 were
imported and 949 were manufactured by 156
local manufacturers.
Over 1700 drugs banned and withdrawn
Capitalist countries had exported
more ineffective, useless or harmful
drugs than that of socialist countries.
West German and Swiss Companies
ranked very high in mischiefs.
Drug is a special commodity, whose
usefulness, safety and quality cannot be
judged by the consumer even though they pay
for it
To protect the consumer, government will
check and fix the price of all drugs
manufactured locally and imported, giving a
good return on the investment of the
pharmaceutical industries
Price Fixation Strategy
For Price fixation purpose, all available
drugs locally produced and imported are
placed in 5 categories
A. Simple repackaging without any processing or
formulations.
B. All oral medicines and topical preparations other
than antibiotics.
C. All oral forms of antibiotics
D. Hormone and steroid preparations
E. All sterile preparations.
Price Fixation Strategy
Category of
Drug
Cost of raw
and
packaging
material
Production,
distribution,
overhead and
profit
Trade or whole
sale price
Retailers
commission on
15% on MRP
MRP without excise
duty/
VAT
A 100 27.50 127.50 22.50 150.00
B 100 91.25 191.25 33.75 225.00
C 100 95.50 195.50 34.50 230.00
D 100 138.00 238.00 42.00 280.00
E 100 189.00 289.00 51.00 340.00
Source: Bangladesh Drug Administration, 1992
Price Fixation Strategy
Cost of Raw Materials (RM) (both active
ingredients and excipients) and Packaging Materials
(PM) are based on landed cost, conversion of US
Dollar to Taka, transport cost from port to factory,
Advance Income Tax (AIT) and custom duties and
other taxes. Value Added Taxes (VAT) is added after
the fixation of Maximum Retail Price (MRP).
Cost of RM and PM usually be reviewed once a
year. Suggested strategy entitled them double figure
profit over their investment
Price Fixation Strategy
Drug Prices in Taka had fallen between 50%
and 75% despite increase in Taka-Dollar
conversion rate.
Quality of manufactured drugs improved
remarkably due to vigilance of Drug
Authority.
Drug market had enhanced from Taka 1000
million to over Taka 25000 million. 10
powerful national companies emerged.
Changes followed during 1984-94
National companies had taken over 60% business
while they had less than 20% business in 1981.
Country started producing about 90% of
Bangladesh needs.
BAPI (Bangladesh Association of Pharmaceutical
Industries) who condemned NDP 1982 had
congratulated Bangladesh Government in 1986 for
helping the unexpected growth of pharmaceutical
companies and improved quality control
Changes followed during 1984-94
Success in domestic market and little export
Pharmaceutical sector recorded sales of Taka
87880 Million ($ 1098 million) and meets
almost 97% of local demand and grew
23.6% in term of sales in 2011 according
to IMS report
1
36 local companies and 3 MNCs had
exported Taka 4212 million ($ 52.6 million)
worth of medicines to 84 countries.
Situation in 2010s:Drug Price started rising
Sales of herbal medicine had jumped to Taka
10000 million ($ 125 million) in 2010 against Taka
10 million in 1980
2
Allopathic doctors found to be prescribing herbal
medicines whose quality and appropriateness raise
big question.
Drug prices started shooting up since early 2010
along with higher number of irrational and
unethical prescriptions. Deaths in governments
hospitals & private clinic were reported in daily
newspapers
3,4.5
Situation in 2010s: drug prices started rising
Unethical promotions by Pharma representatives
leading to sudden influx of unethical and irrational
prescriptions
Azithromycin is frequently used for diarrhea by General
Practitioners as promoted with unethical research among
poor patients without their informed consent by ICDDR,B
6
Pharma reps bribing doctors directly
7
and they
violate every norms to check doctors prescriptions
in medical college hospitals
8
Unethical Promotions and Irrational Prescriptions
Unethical promotions and irrational prescriptions (cont.)
Doctors are writing more prescriptions for Nitazoxanide
instead of Metronidazole for amoebiasis and
diarrheas; Azithromycin for diarrhea, typhoid and PID
Other misused drugs are caffeine with paracetamol,
Diclofenacs, Statins, Irrational vitamin preparations with all
sorts of mineral which cannot be detected in Government
Drug Laboratory; Benzodiazepines, sex hormones, steroids,
Terbinafine, Butenafine, Crotamiton etc
Promoting Directly to Consumers through daily newspaper
with separate advertising sheet on Dukoral (a Swedish
company, Crucell product) for prevention of diarrhea and
cholera tactfully using name of WHO and ICDDR,B
Aggressive and unethical promotion increases
irrational prescriptions leading to
multiplication of profit of the companies
Counterfeit version of costly drugs are
surfacing in progressive order.
More spurious and substandard drugs freely
moving into the market.
Counterfeit
Counterfeit is a sharing mechanism
of sinful excessive profit.
By 1994, some national pharmaceuticals
achieved tremendous growth and invested their
profit in other business for faster return.
They became greedy and quietly bribed health
ministry top personnel. A 6 member committee
was constituted, majority members were well
known for their opposition to NDP `82. A
departmental order was passed on their
recommendation in gross violation of the spirit
of the NDP `82.
Why such reversal?
1. A list of 117 drug (referred as Listed Drugs
should remain under existing price control
regulation, 26 of 117 Listed Drug were
contraceptives intravenous solution and
vaccines.
2. Fast selling drugs such as cimetidine,
Ranitidine, Diclofenac, Cephalosporins,
vitamins with minerals and newer drugs
were excluded from the Listed Drugs.
Why such reversal?
3. Every manufacturer should ensure 60 % of drugs it
produces are Listed Drugs.
4. To ensure sufficient production of Listed Drugs
duties on unlisted drug may be raised to 15%
Clause 3 & 4 never been enforced
5. Prices of drug not in Listed Drugs will be fixed by
pharmaceutical manufacturing companies
themselves. This is called Indicative Price on
which Drug Authority will add 15% VAT.
Why such reversal?
Profit for Indicative Price Drugs is
enormous, while profit in listed drugs is
reasonablebut not even 10 percent of the
indicativepricegroup
Why such reversal?
All committees were reconstituted with
greater number of drug industry owner
representatives
On the other hand, Medical Association is
poorly represented by only one junior
teacher
Drug Administration are allowing more and
more combination drugs, all of which are in
INDICATIVE PRICE Category
Why such reversal?
Easy excessive profits made pharma companies
reckless and making misleading statements
implicating of Dollar Taka conversion rate as a
reason for increase price. As a counter
misinformation, continuously propagating that
pharma exports will soon overtake garment
export. Present pharma export is not even 1
percent of total national export.
Why such reversal?
They cleverly change the mark-up systemof 117
listed drugs. Existing 5 categories were expanded
to 9 categories to harness further profit out of
Listed Drugs group
Why such reversal?
Sl.
Product RM+PM Markup
MRP
without VAT
1. Repacking 100 50 150
2.
Oral preparation except
Antibiotics and FP preparations
100 125 225
3. Antiviral, Antiinfective, Antifungal 100 130 230
4. Oral Antibiotics 100 130 230
5. Sustain Release Tablet/ Capsule 100 180 280
6. FP Pills 100 180 280
7. Dispersible Tablets 100 200 300
8. Steroid and Hormones 100 240 340
9. Aseptic Preparations 100 240 340
Some Price Comparisons of Listed Drugs and
IndicativePricedDrugs
Why such reversal?
Listed Drugs Unit price Indicative Price Drugs Unit price
Tablet Metronidazole
400 mg
Tk 1.20 Nitazoxanide
500 mg
Tk 10.00
Erythromycin
500 mg
Tk 8.00 Tab. Azithromycin
500 mg
Inj. Azithromycin
500 mg
Tk 30.00
Tk 250.00
Ung Whitfield
25 gm
Tk 10.00 Terbinafine Tube
5g
Tk 50.00
Benzyl Benzoate Lotion
100 ml
Tk 18.00 Crotamiton
60 ml
Tk 66.00
Tab. Paracetamol
500mg
Tk 0.60 Tab. Paracetamol
500 mg with 65 mg Caffeine
Tk 1.80
Tab. Paracetamol
665 mg extended release
Tk 2.50
Teaching of clinical pharmacology
and pharmaco-economics is of
utmost importance to protect
peoples health from the greed of
the pharma industries.
APCNMP, Sydney 28 May 2012
1
Pharma sales rise 20 pc; outlook is bright, The daily Star, Dhaka, 21 May 2012.
2
Herbal medicine market to cross Taka 2500 crore by 2010, The Daily Star, 20 may
2012.
3
Child died within 2 minuits of injection: Alleged irrational treatment, Daily Azadi,
Chittagong 8 October 2008.
4
Injection given wrongly in Kushtia Government Hospital, Daily Prothom Alo,
Dhaka 6 February 2009.
5
Death from Azithromycin injection, Daily Somokal, Dhaka 23 April 2010.
6
Diarrhea prevention and oral Azithromycin. Daily Prothom Alo, 7 April 2010.
7
Doctors are taking money from drug companies, Daily Bangladesh Protidin, Dhaka
24 May 2012.
8
Representatives are reckless in hospitals, Daily Bangladesh Protidine, Dhaka 24
May 2012.
References