Healthy Contrasts: A Look at Markets and Health Systems Across the ASEAN Region - Pharmaceutical Technology

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Healthy Contrasts: A Look at Markets and Health Systems Across the ASEAN Region


Pharmaceutical Technology


A new pharmaceutical law is in the works and should further change the shape of the Thai health sector. The law would require a qualified pharmacist in drug retail outlets and would broaden requirements for prescriptions. The new rules are expected to drive many smaller retailers out of business and rationalize the way drugs are sold in the country. In the meantime, the plan by Thai authorities to turn the country into a regional health tourism center should further strengthen sales of higher-value and life-style drugs in the country.

Malaysia: reforms at work

The Malaysian social security system has been evolving and adapting to new realities: The membership base includes 540,000 employers and over 10 million employees, with contributions of well over $300 million per year. The system is still evolving away from a collection of employer liability schemes, provident funds, and social insurance. Until the beginning of this decade, the scope of the coverage was limited to the formal sector and that too limited by wage ceilings. A large proportion of the economically active population—the self-employed farmers and fishermen—was excluded from the coverage. Protection for senior citizens was also found to be inadequate.

A wide array of reforms have therefore been discussed and their implementation is on the way: designing a social security scheme for the self-employed and projections for a social insurance-based retirement pension scheme are in the works. Legislators are also considering expanding the social security system to include pregnant women and extending coverage for illness.

The Philippines: reforming the retailer's paradise

The Philippine pharma market is something of an anomaly: while the country lags on social service and reform, retail drug prices are amongst the highest in the region. For example, GlaxoSmithKline's Ventolin sells for 331.50 Philippines Pesos (PhP)—or about $6.44—in the country; the same inhaler sells for $2.40 in India and $1.21 in Pakistan. A tablet of Novartis's Voltaren sells for PhP 18 ($0.35) in The Philippines, against $0.02 PhP in India and $0.07 in Pakistan. Therefore, the price issue is one of the elements of reform encompassed in the Medium Term Philippine Development Plan 2005–2010. The scheme would also expand a universal health insurance plan, which currently covers 44.9% of the population. The program is managed by PhilHealth, which assumed responsibility for administering the former Medicare program for government and private sector employees following the program's landmark transfers from the Government Service Insurance System (October 1997) and its Social Security System (April 1998).

Meanwhile, another initiative aims to make 44 of the most commonly used medicines available across the archipelago in retail outlets managed by PITC, the Philippine International Trading Corporation. There are already several thousand of these Botika ng Bayan (people's drugstores) selling cheap imported and locally produced generic drugs. (The program has, not surprisingly, produced clashes with innovator companies.)

Singapore: total coverage

The city-state is the region's most advanced in terms of health coverage. It is also a renowned medical center, with specialist physicians operating with state-of-the-art procedures and technologies, across a wide range of conditions. The keystone of the Singaporean health system is the Central Provident Fund, created in 1955 and funded by compulsory contributions from employers and employees. Acting both as a pension and a health-insurance fund, the program divides into three branches (the 3 Ms): Medisave, a compulsory contribution of 6–8% of the monthly salary covering hospital expenses (up to a cap); Medishield, a voluntary contribution covering extra hospital expenses; and Medifund, which covers the country's neediest citizens through case-by-case decisions. The government is also planning to introduce a fourth M before 2008: Means testing, by correlating contribution to income levels, will extend Medisave to cover to high-tech medicine and achieve economies of scale. Meanwhile, Singapore is also considering prohibiting doctors from selling medicines directly.

This report was prepared by Executive Country Reviews. Authors are Gilles Valentin
Emmanuelle Berthemet
Marco Parigi
and Amicie de Bodinat


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