Fight over drugs procurement takes a vicious turn in Kenya

By Gatonye Gathura

The fight over local versus imported medicines turned vicious this week with various groups including doctors taking hardline positions.

A national health sector forum organized by the Ministry of Health this week at the Laico Regency, Nairobi demanded the cost of medicines be brought down if the country is to achieve affordable medical care for all by 2022.

In a group report read by Catherine Maingi, of the Kenya Medical Supplies Authority on Wednesday, health workers want the list of essential medicines to be reviewed urgently.

A reviewed list they said must include drugs for emerging chronic conditions which will be protected against high prices, stock outs and be part of the universal health care package.

They said one way to bring down the cost of medicines in Kenya is to support local manufacturers.

But a local non-governmental organization, Kenya Treatment Access Movement (KETAM) has written to the government opposing plans to impose a 25 per cent duty on imported medicines.

In a pre-budget proposal the Kenya Association of Manufacturers (KAM) want the Treasury to impose a 25 per cent duty on imported medicines for which there is sufficient local manufacturing capacity.

This KMA says will caution local manufacturers against huge donor supported tax-free drug imports from China and India and strengthen local capacity.

In a report appearing in this paper last Sunday, a study by Kenya Medical Research Institute said duty free donor funded imports from China and India were killing the local pharmaceutical industry.

Following complaints over unfair trade practices from local manufacturers, the Cabinet Secretary for trade Mohammed Adan said they are working with the National Treasury on the matter.

But KETAM has strongly opposed the proposal to slap any tax on imported medicine saying this will likely increase the cost of health care and compromise quality.

“If applied the proposed 25 per cent duty on imported medicines will further increase the cost of health care in Kenya,” says KETAM in the letter copied to the cabinet secretaries for Treasury and that for Trade.

In an interview with the Standard on Thursday, KETAM CEO James Kamau said even with 25 per cent duty on imported medicines, they will still be cheaper than from local producers.

“So why impose a tax that will only increase the cost of medicines without giving local manufactures any apparent advantage?”

Kamau says protecting local manufactures through ring fencing will also protect poor quality medicines which infringes on the constitutional rights of consumers,” Kamau told the Standard on Thursday.

But Palu Dhanani, chairman of the Federation of Kenya Pharmaceutical Manufacturers say there is no reason for drug prices to go up or quality to drop.

“In fact we are suggesting several other policy changes which could help lower the cost of medicines in Kenya,” says Dhanani.

Such include lobbying for more local companies holding the UN accepted GMP certification to be allowed to participate in international tenders now a preserve of a few WHO prequalified companies.

By 2010 Kenya had 26 drug companies with such GMP certification.

A similar policy change in South Africa, a UNAIDS report shows had reduced government expenditure on ARVs by 53 per. Currently South Africa the cost of antiretrovirals in South Africa is among the lowest in the world.

“With current pricing of medicines in Kenya even the best of insurances offer little protection,” Maingi a planner at Kemsa told the Standard.

“Almost half of medical claims are going into buying drugs,” says Catherine Karori, head of Medical at Jubilee Insurance.

But this is hardly a universal problem with the cost of medicines being much higher in Kenya than in many other countries.

Comparatively while 45 per cent of a patient’s medical bill in Kenya goes to medicines, in the US, the world’s most expensive health care market, drugs take up only nine per cent.

Data by the American research firm IMS Health shows a similar trend in Norway, Denmark, Luxembourg, The Netherlands, United Kingdom and Switzerland compared to Kenya.

Medicines in Kenya are also more expensive than similar products in neighbouring Uganda, Tanzania, as well as in Asia and Europe.

For instance, the average wholesale price of a packet of imported 10 tablets of Augmentin, an antibiotic for infections such as pneumonia, costs Sh1,500 in the UK but about Sh9,500 in Kenya.

The same crucial medicine costs less than half the price in Tanzania and Uganda.

Similarly, Zaltrap, the brand name of a medicine used to treat cancer of the rectum costs Sh350, 000 per injection in Kenya.

The same medicine by the same manufacturer costs Sh59, 000 in Turkey and the list goes on.

Countries maintaining low drug prices, Dr William Mwatu, the chairman, Kenya Association of Pharmaceutical Industry, says have well regulated and executed pro-patient policies.

“With good and well executed drug policies we can make huge savings and still deliver high quality care for everybody,” Dr Mwatu wrote recently.

One way of cutting cost of medicines, Dr Mwatu says is strict and judicious use of generics as opposed to branded drugs.

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At a glance

Cost of medicine in Kenya among highest in the world

45 per cent of a hospital bill goes to drugs in Kenya

10 per cent of a hospital bill goes to drugs in UK, US, Norway

10 tablets of Augmentin, costs Sh1, 500 in the UK but about Sh9, 500 in Kenya

Zaltrap a medicine for cancer costs Sh350, 000 per injection in Kenya but Sh59, 000 in Turkey

Proposal to impose 25 per cent duty on imported medicine

Kenyans pay 35 per cent more for diabetic medicines compare to UK.