- Market data has shown major increase in use of price-regulated medicines, which is a direct result of greater patient compliance to prescriptions as a result of increased affordability
- This paradoxical situation where poorer countries spend more on medicines procurement than richer countries has dangerous consequences
- The NMRA is not against profit, but will stand against profiteering that has corrupted the entire medicines supply chain
- Linking electronically with State agencies that oversee medicines imports will provide the NMRA access to important commercial information
By Darshana Abayasingha
The aim of Universal Health Coverage, is to ensure that all people and communities receive the healthcare they need, without experiencing financial hardship. In Sri Lanka, with Government investing less than 2% of the National GDP on health, our country’s health financing model relies heavily on out-of-pocket expenditure by households comprising almost 50% of total health expenditure.
Spending on medicines is the dominant component of private expenditure on healthcare, accounting on average for an estimated 34% of total household expenditure on health, avers National Medicines Regulatory Authority (NMRA) Chairman Prof. Asita de Silva, quoting a World Health Organization report of 2018.
The NMRA, which was established through an Act of Parliament in 2015 to regulate all aspects of medicinal products has to address the dual challenge of reducing out-of-pocket expenses to access medicine as well as help manage the State medicines procurement cost in the background of sub-optimal investment on health. Sri Lanka imports more than 90% of medicines it uses and spends more than 30% of the national health budget to procure medicines, compared to approximately 18% in developed countries.
This paradoxical situation where poorer countries spend more in percentage terms on medicines procurement than richer countries has dangerous consequences that could threaten the sustainability of their healthcare systems.
“Our principal objective is to increase patient access to quality-assured medicine while supporting the sustainability of Sri Lanka’s wonderful State-funded healthcare system, states Prof. de Silva who is also the Senior Professor of Pharmacology in the Faculty of Medicine, University of Kelaniya. We try to address these challenges in multiple ways, including judicious assessment of need based on cost-effectiveness, price regulation as well as supporting, within applicable laws and regulations, local manufacture of medicine. This involves interaction with various stakeholders including members of the public, medical professionals, suppliers, pharmaceutical companies and a gamut of powerful players who need to be engaged with equanimity.
“We have extremely onerous workflow and document review processes; dossier evaluation for registration of a medicine can take in excess of six months. In spite of such careful review, we as the medicines regulator take a risk, however small, when granting market authorisation to medicinal products. Although various measures are implemented to mitigate such risk, there is always a degree of uncertainty in our line of work. We are very cognisant of the fact that every decision taken by the NMRA will impact lives of patients. This is why the national medicines regulator has to work independently and transparently basing its decisions on evidence. The Board of the NMRA is of the opinion that automation of our workflow and document management through digitalisation is the best approach to increase transparency and efficiency in the Authority. I personally think by exposing ourselves to a high level of public scrutiny, we can improve the level of transparency and efficiency in our work, which is why we embarked on this journey,” Prof. de Silva says.
The NMRA initiated its digitalisation process with project management support from the Information Communication and Technology Agency (ICTA). The Authority rolled out its digital platform on 1 October and has now stopped accepting manual submissions for registrations of medicinal products and issuing numerous licenses. The system will also be open to the public, who can now apply for Personal User Licenses for medicines online from the comfort of their homes, without having to visit the NMRA in Colombo.
In addition to medicines, the 3,000-plus pharmacies registered around the country could apply and renew their licenses online. At present, anyone wishing to obtain a license to operate a pharmacy must make such an application in person by coming to the NMRA office in Colombo. Therefore, the digital system, e-NMRA, will help pharmacy owners manage their regulatory requirements much more efficiently. At the user-end our system could be used to develop built-in triggers to alert licensees to submit applications for renewal six months before expiry as mandated by legislation, which would enhance efficiency of internal regulatory functions and speed of service.
“Improving transparency will improve trust, confidence and understanding of the level of effort we have to put in to regulate medicines at the NMRA to ensure patients receive safe and effective medicines. Every medicine has to be reviewed thoroughly before granting market authorisation and that is a huge effort. Although the NMRA is not involved in procurement in any way, the Authority facilitates the availability of medicinal products in the State sector following the same stringent registration process. Digitalisation will provide us a lot of important data on every license issued. This will allow us to keep a track on internal processes, types of medicines registered, their cost and other important information more accurately.
“The NMRA is most interested in getting accurate information on imported quantities and CIF prices from the suppliers, which at present has proved to be a difficult task. Some suppliers obtain market authorisations to import medicines, but do not supply a single tablet. This is done either to block competition or to participate exclusively in government tenders, which is strictly illegal. The law empowers the NMRA to revoke licenses in such situations, but our capacity to do so is hampered by the lack of reliable data.
“Automation will allow us to expand the network of information by linking seamlessly with the Departments of Customs and Import and Export Control. Linking up electronically with State agencies that oversee medicines imports to the country will provide the NMRA access to important commercial information. From the supplier’s point, they will be able to track a submission and see whether the regulator manages submissions on a ‘first in first out’ basis.
“The Authority has the right to decide on priority review based on public interest, but with the degree of transparency digitalisation brings in, we will need to do so with clear justification. Therefore, we believe digitalisation of the NMRA will make the provision of regulatory oversight more efficient, transparent and fair to all stakeholders,” Prof. de Silva adds.
‘WHO-listed Regulatory Authority’ status
The NMRA has also opened itself for a voluntary benchmarking audit by the WHO’s Regulatory Systems Strengthening Unit based in Switzerland. The process started in February last year and the final review will be conducted during the last week of October 2019. The objective is to achieve ‘WHO-listed Regulatory Authority’ status for the NMRA, which will be an international endorsement of the processes and document management systems followed by the Authority.
“Achieving this milestone after just a little over three years since the NMRA was established will be phenomenal. It should give the public more confidence in their regulator, and more importantly in the medicines available to them. But, the regulator cannot ensure the integrity of the entire supply chain by itself. All stakeholders including suppliers, distributors, prescribers as well as patients have important roles to play. For example, patients should not buy medicines from a pharmacy that does not have a registration certificate from the NMRA, does not have a dispensing pharmacist, and does not clearly display retail prices – all statutory requirements.
“The NMRA will start a program to increase public awareness on safety of medicines, dangers of misuse, need for price-consciousness and other important aspects of medicines use in the very near future. In fact, the Committee on Public Enterprise, an institution to which I have the highest respect, has been critical of the NMRA for not doing enough to educate the public on safe use of medicines,” emphasised Prof de Silva.
Healthcare professionals too must take great care when handling medicines such as storage conditions and the need to adhere to guidance provided in summary product characteristic for each medicine. For example, if a medicine is stored under a temperature above what has been recommended by the manufacturer, it is unlikely to retain its efficacy. Officers in the Enforcement Division in the Authority will be initiating Good Pharmacy Practice inspections, especially at State hospitals, very soon. The required legal regulations to support their work have now been gazetted.
Prof. de Silva remarks that various questions and issues have been raised with regards to quality of medicines available at State hospitals. Re-emphasising that the NMRA does not get involved in procurement of medicines, he outlined the stringent review process undertaken by highly-trained pharmaceutical scientists at the NMRA and other external specialists before granting registration to ensure the quality and safety of medicinal products available in the country.
One of the most important components of the supply chain, he says, is Quality Assurance. At present, the capacity of our National quality assurance laboratory for medicines (NMQAL), due to various infrastructure and human resource issues is sub-optimal. Although the NMQAL tests samples submitted to the Authority at the time of registration more needs to be done post-registration, and the lab needs to develop capacity in the areas of biomedical engineering and biotechnology product assessment.
This is an issue that has received the highest attention of the senior management of NMRA, and will be addressed soon by establishing a state-of-the-art QA laboratory in the NMRA with guidance of the WHO and regional network of medicines regulators. The blueprint has been finalised and funds generated by the Authority has been set aside to do this work with approval of the Department of National Planning.
Prof. de Silva points out that even with astute Government procurement, poor quality medicinal products could come into the system. This is true not only for Sri Lanka but elsewhere in the world as well. Regulatory institutions and procurement agencies need to work closely to minimise entry of such products to the market. Not only medicines of questionable quality, there are falsified medicines and vaccines that threaten to enter healthcare systems everywhere.
There are home-based manufactures in countries such as Afghanistan and Pakistan where medicine capsules are hand-filled plus unscrupulous suppliers who bring unregistered medicines in their luggage from overseas. This is why the WHO has a global alert system to counter this threat by keeping national regulators fully informed. The NMRA is a member of that network. Digitalisation will further improve our responsiveness to such alerts allowing the NMRA to be more efficient in dealing with this danger.
Prof. de Silva stresses the NMRA’s focus to follow stringent regulatory processes at the time of registration to ensure quality and safety as mandated by legislation. In addition, the NMRA has now been mandated by law to look at need and cost – basically, cost-effectiveness of medicine to be made available to our patients. We believe one of the main approaches to manage Sri Lanka’s medicines budget is to focus on quality-assured generic medicines, most of which are manufactured in India.
Some pharmaceutical companies with vested interests, based on one or two quality failures of medicines reported from State institutions, promote the idea only innovator products manufactured in developed countries are effective and safe. This is furthest from the truth. The NMRA Chairman points out that even in the United Kingdom approximately 40% of medicines used in the National Health Service are generics. It is safe to say health systems even in developed countries would have collapsed if they did not have access to generic medicines.
Cost determines access
“As stated earlier, the NMRA’s main objective is to increase patient access to medicines. Cost determines access. Before 2016, the price of a medicine was unilaterally decided by the suppler. The National regulator did not intervene in any way. This is completely unacceptable, which is why we have now started focusing our attention on price. When the NMRA regulated prices of medicines, which now covers more than 70 molecules, there were many detractors who predicted the effort will result in total failure with ‘higher quality’ products exiting the market.
“One newspaper editorialised the predicted doomsday scenario for medicines in Sri Lanka. The same prediction was made for intraocular lenses as well as cardiac stents. Nothing of that sort has happened. Analysis of market data from 2016 to 2018 has shown a major increase in the use of price regulated medicines, which is a direct result of greater patient compliance to their prescriptions as a result of increased affordability. For example, use of metformin, a medicine widely used to treat diabetes increased by 24% in one year, as well as medicines used to treat high blood pressure, high cholesterol and a number of other chronic diseases and widely used antibiotics.
“Not only that, the so-called ‘better quality’ brands have recorded up to 500% increases in their market share. Just to give a simple example, a popular brand of paracetamol that used to be Rs. 3 a tablet and reduced to around Rs. 1.40 saw their market share expanding by 91% after price regulation. In other words, data clearly show patients being more compliant to prescriptions and accessing the brands perceived to be of higher quality when they are more affordable.
“We believe the overall benefit of this will be evident in five-six years when patients have their illnesses better managed resulting in reduced morbidity and mortality. The Chamber of pharmaceutical importers today accept price regulation of medicines has achieved desired results that will ultimately benefit patients,” he states.
“Same goes for medicines procured for State hospitals, especially oncology drugs, as around 90-95% of cancer medicines are accessed through State institutions due to their high cost. The State spends approximately Rs. 7.2 billion per year to procure cancer medicines; 60% of this total cost is spent to procure just 10 of them. After registering many other competitor brands, especially bio-similar medicines, we successfully targeted these 10 medicines for price reduction in 2018 through regulation of tender prices, something not done before.
“The estimated saving to the State through that initiative has been close to Rs. 2 billion in one year. All over the world biosimilar medicines are pursued with great interest by medicines regulators to increase value proposition brought by this class of medicine to treat diseases such as cancer. The NMRA registered the first biosimilar of trastuzumab, a drug used for the treatment of a particular type of breast cancer in 2016 when Prof. Krisantha Weerasuriya was the CEO and Prof. Laal Jayakody was the Chairman of the Authority. Both of them are highly respected professors in pharmacology who have worked tirelessly to improve the medicine regulatory regime in Sri Lanka through legislation and implement Senaka Bibile principles for medicines in the country.
“Although registration was granted following internationally accepted regulatory guidelines, those who stood to lose out on major profits enjoyed over a long period of time spread negative stories regarding this product. The whole negativity was based on lies and misconceptions. A court case was filed against the NMRA by a multi-national pharmaceutical company challenging its decision to register this biosimilar, which had to be withdrawn later.
“After three years since first registration of this drug and more than 18,000 vials used at State hospitals, the NMRA has not received a single written complaint with evidence regarding the quality of this Russian manufactured drug. What actually happened was trastuzumab that cost more than Rs. 230,000 per vial until 2016 came down to around Rs. 94,500 today.
“Subsequently, we have registered three more trastuzumab biosimilars – two of which are manufactured in India and have received market authorisation in countries like USA, Canada and Australia – and the cost of this medicine at the last Government tender was less than Rs. 50,000 per vial. I must emphasise the NMRA is not against profit, but will stand against profiteering that has corrupted the entire medicines supply chain,” asserts the Chairman of the Authority.
Explaining further the benefits of competition to meaningfully regulate prices in an open market economy, Prof. de Silva reveals that only two brands of insulin were available in the country until around 2015-16, after which four more brands were registered. As a result, the lowest tender price of a 10 ml vial of insulin that was $ 4.74 in 2016 came down to $ 1.43 in 2019. Not surprisingly, the brand that was quoted at $ 4.74 in 2016 was quoted at $ 1.47 in 2019. The savings derived from these could be invested in other important areas of healthcare to improve the lives of patients, he adds,
The NMRA also dramatically reduced the price of cardiac stents, which had markups of over 200% before price regulation. Despite protestations and threats to exit the local market from big brand suppliers the price regulation of this lifesaving medical device has provided a major lifeline for heart patients, and all brands continue to be available in the country. Specialist cardiologists are observing more patients who need stenting are now accessing same due to increased affordability.
Giving a further example Prof. de Silva states prices of intraocular lenses (IOL) were reduced by 50% or more by the NMRA in 2017. A brand of IOL, which cost around Rs. 30,000 previously can now be purchased for half that price. Furthermore, these major price reductions of stents and IOLs have enabled the Ministry of Health to provide them free of charge to our patients, Prof. de Silva asserts.
“The NMRA registers medicines only if the benefit of a medicine outweighs risk. A vaccine to prevent dengue manufactured by a French pharmaceutical company was registered in many countries including Singapore and Philippines recently. The expert committee that reviewed scientific data in the NMRA had serious concerns about the safety of this vaccine. Based on their advice the NMRA did not register it here. This was in 2017 when there was a major epidemic of dengue in the country. There was enormous pressure on the Authority from various groups and individuals including some in the diplomatic community to register the vaccine.
“Philippines was the only Asian country to introduce the vaccine into their public health system. A year or so later many deaths of children who received the vaccine in that country were reported and the entire program was suspended. This has had a very negative impact on the overall immunisation program in the Philippines resulting in outbreaks of preventable diseases like measles due to poor uptake of vaccines by the general population. The WHO has now withdrawn their original recommendation for this vaccine.
“Two years later the decision taken by the NMRA to withhold registration pending more evidence, which came under intense criticism, has been vindicated. We believe the prudent decision taken by the NMRA in 2017 regarding this vaccine averted a potential public health disaster in Sri Lanka similar to what has happened in the Philippines. Unfortunately, nobody talks about that. I guess such positive information does not sell newspapers,” observes Prof. de Silva.
Ambitious journey of modernisation
The NMRA has embarked on an ambitious journey of modernisation. Digitalisation is just one component. The cost of all these initiatives – digitalisation, development of a modern NMQAL, building a new office complex for the Authority estimated to cost Rs. 3.2 billion – will be financed 100% by generated funds of the Authority. Since 2017, the NMRA has not received any funds from the National Treasury and is a financially independent State institution.
“This allows us to plan and undertake important programs independently without having to burden the National Treasury. Automation is one such example. With increased access to data and ability to network through our e-NMRA program, the Authority aims to provide the expected public service efficiently and transparently,” concludes the NMRA Chairman.