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Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
AT A GLANCE:
It is the policy of the State to protect public health and, when the public interest or circumstances of extreme urgency so require, it shall adopt appropriate measures to promote and ensure access to affordable quality drugs and medicines for all.
Pursuant to the attainment of this general policy, an effective competition policy in the supply and demand of quality affordable drugs and medicines is recognized by the State as a primary instrument. In the event that full competition is not effective, the State recognizes as a reserve instrument the regulation of prices of drugs and medicines, with clear accountability by the implementing authority as mandated in this Act, as one of the means to also promote and ensure access to quality affordable medicines. (Section 1, Republic Act No. 9502)
In 2008, the Philippines took a significant step towards improving the accessibility and affordability of healthcare for its citizens with the enactment of the Universally Accessible Cheaper and Quality Medicines Act, officially known as Republic Act No. 9502. This landmark legislation aimed to address the pressing issue of expensive medications, ensuring that high-quality medicines are within reach for all Filipinos.
Effective Competition
To foster a more competitive pharmaceutical market, the act encourages the importation of quality and affordable medicines. It provides mechanisms for expedited registration and approval processes for new and generic drugs, allowing for a diverse range of options to be available to consumers. This increased competition helps to drive prices down, benefiting patients and healthcare providers alike.
The law says:
“Effective Competition shall encourage a milieu where there are a significant number of players at each level of the pharmaceutical supply chain that shall ensure availability and affordability of these health products. It exists in an environment where the consumers are well informed and are able to exercise their right to choose from a variety of variable options to access affordable, quality drugs and medicines.” (Rule 2, Implementing Rules and Regulations of Republic Act No. 9502)
“Centralized Importation for Government. Except for specific programs and instances allowed by DOH, for purposes of ascertaining the best and most affordable prices and quality of drugs and medicines to be imported, all government agencies must centrally procure through Philippine International Trading Corporation Pharma Inc.” (Rule 16, Section 1, Implementing Rules and Regulations of Republic Act No. 9502)
Affordable and Quality Medicines
The primary objective of the Universally Accessible Cheaper and Quality Medicines Act of 2008 is to make essential medicines more affordable and readily available to every Filipino. It encourages competition within the pharmaceutical industry, discouraging monopolies, and price manipulation.
The law says:
“Implementation of Fair Price of Drugs and Medicine. The Secretary of Health shall have the power to implement the fair price of drugs and medicines for purposes of public health insurance and government procurement based on the order of the President of the Philippines imposing maximum retail price.” (Rule 20, Implementing Rules and Regulations of Republic Act No. 9502)
As such, the Secretary of Health has the power to determine maximum retail prices of drugs and medicines. The law says:
“Upon application or motu propio when the public interest so requires, the Secretary of Health shall have the power to determine the MRP of drugs and medicines which shall be recommended to the President of the Philippines for approval.” (Rule 19, Implementing Rules and Regulations of Republic Act No. 9502)
List of Drugs and Medicines that are Subject to Price Regulation
The law says:
“The list of drugs and medicines that are subject to price regulation shall include, inter alia:
(a) Drugs and medicines that are included in the current edition of the Philippine National Drug Formulary (PNDF) Essential Drugs List;
(b) All drugs and medicines indicated for treatment of chronic illnesses and life threatening conditions, such as, but not limited to, endocrine disorders, e.g., diabetes mellitus; gastrointestinal disorders, e.g., peptic ulcer; urologic disorders, e.g., benign prostatic hyperplasia (BPH; cardiovascular diseases, e.g., hypertension; pulmonary diseases, e.g., pulmonary tuberculosis (PTB), asthma; auto-immune diseases, e.g., systemic lupus erythematosus (SLE); skin diseases, e.g., psoriasis; neuro-psychiatric disorders; other infectious diseases, e.g., human immunodeficiency virus-acquired immune deficiency syndrome (HIV-AIDS); and other conditions such as organ transplants and neoplasm;
(c) Drugs and medicines indicated for prevention of diseases, e.g., vaccines, immunoglobulin, anti-sera;
(d) Drugs and medicines indicated for prevention of pregnancy, e.g., oral contraceptives;
(e) Anesthetic agents;
(f) Intravenous fluids; and.
(g) All other drugs and medicines which, from time to time, the Secretary of Health, in accordance with the relevant provisions of these Implementing Rules and Regulations, determine to be in need of price regulation.” (Section 5, Rule 30, Implementing Rules and Regulations of Republic Act No. 9502)
Illegal Acts of Price Manipulations
- Hoarding
The law says:
(i) Definition. The following shall constitute hoarding:
- The undue accumulation by a person or combination of persons of any drug or medicine beyond his/their normal inventory level; or,
- The unreasonable limitation or refusal to dispose, sell or distribute said drug or medicine; or,
- The unjustifiable taking out of said drug or medicine from the channels of production, trade, commerce and industry.
(ii) Prima Facie Evidence of Hoarding. The following shall constitute prima facie evidence of hoarding:
- When a person has stocks of any drug or medicine fifty percent (50%) higher than his usual inventory, and,
- Unreasonably limits, refuses or fails to sell the same to the general public at the time of discovery of the stocks.
A person’s usual inventory shall be reckoned from the third month immediately preceding before the discovery of the stocks in case the person has already been engaged in the business for at least three (3) months; otherwise, it shall be reckoned from the time he started his business. (Rule 42, Section 2, Implementing Rules and Regulations of Republic Act No. 9502)
- Profiteering
- Definition. Profiteering is the sale or offering for sale of any drug or medicine at a price grossly in excess of its true worth.
- Prima Facie Evidence of Profiteering. There shall be prima facie evidence of profiteering whenever a drug or medicine being sold:
- Has no price tag; or
- Is misrepresented as to its weight or measurement; or
- Is adulterated or diluted; or
- Whenever a person raises the price of said drug or medicine which he sells or offers for sale to the general public by more than ten percent (10%) of its price in the immediately preceding month. (Rule 42, Section 3, Implementing Rules and Regulations of Republic Act No. 9502)
3. Cartel
- Definition. Refers to any combination of, or agreement between, two or more persons engaged in the production, manufacturing, processing, storage, supply, distribution, marketing, sale or disposition of any drug or medicine designed to artificially and unreasonably increase or manipulate its price.
- Prima Facie Evidence of Engaging in a Cartel. There shall be prima facie evidence of engaging in a cartel whenever two (2) or more persons or business enterprises competing for the same market and dealing in the same drugs or medicines that are pharmaceutical equivalents, commit any of the following:
- Perform uniform or complementary acts among themselves which tend to bring about artificial and unreasonable increase in the price of any drug or medicine that are pharmaceutical equivalents; or
- Simultaneously and unreasonably increase prices on their competing products that are pharmaceutical equivalents thereby lessening competition among them.
Read also: Does the President have the power to impose maximum retail prices over drugs and medicines?
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