Cheaper Medicines Act

How can the Law and its IRR make medicines more accessible & affordable to
Filipinos?

The Law and its IRR intend to make medicines more accessible & affordable to
Filipinos by enforcing provisions that improve market competition, availability,
contain costs, improve healthcare provider and consumers behaviour, and when
instances so require, even regulate prices.

a. Interventions to Improve Competition:

i. Parallel Importation of patented Medicines

ii. Required Production of Generic Drugs

iii. Promotion of quality generic drugs

iv. Enforcement of the Early working Provision for patented medicines.

b. Interventions to Improve Availability:

i. Compulsory Licensing for patented Medicines

ii. Special Compulsory Licensing for patented Medicines

iii. Government Use of Patented Medicines

iv. Mandatory Carry for patented parallel imports

v. Non-traditional outlets like Convenience Stores and supermarkets

allowed to sell Over-the-Counter drugs

c. Cost containment Measures:

i. PhilHealth Reimbursements

ii. Government Pooled Procurement

iii. Consignment

d. Interventions to improve Professional behavior to serve the needs of the poor

and vulnerable:

i. Generics only prescribing in government facilities and by government

health workers

ii. Required use of generic terminology in all transactions including

precribing for health workers and reimbursing for PHIC

e. Interventions to regulate prices

i. Imposition of Maximum Retail Prices

ii. Drug Price Monitoring by the Government

What happens to violators of the Law and its IRR?

There are administrative sanctions that may be imposed by the Secretary of Health
to violators. This is separate from any criminal or civil liability that may be
incurred upon filing of appropriate charges in the courts of Law.

What is parallel importation and how does it bring down the prices of medicines?

Parallel importation (Sec. 7), as applied to the local setting, is when a patented
drug is brought into the country by Government or any private third party even
without the consent of the patent holder as long as any of the 2 condition is met:

a. It has been introduced in the Philippines by the patent holder, or

b. It has been introduced anywhere in the world by the patent owner.

It allows for an importer to shop around for a good price for a patented product,
bring this into the country and sell it to a more competitive and affordable price
than the prevailing price of the same patented product sourced locally from the
innovator company.

Example: a drug sold here at 45 pesos per tablet and sold at 8 pesos in another
country, an importer may now bring the quality cheaper medicine in the country and
sell it cheaper for our countrymen.

What is the Cheaper Medicines Act?

The Law intends to achieve better health outcomes for the Filipino people by
assuring that quality medicines are accessible and affordable to as many Filipinos
especially the poor.

There are a number of factors to be considered and a variety of issues and concerns
to address when facing the problem of access to medicines. Among the major and
critical issues include those of rational drug use, public perception on generics,
health professional behaviour on prescribing and dispensing medicines, information
asymmetry and exercising informed choice, pricing, supply and distribution, and
procurement systems transparency, respect for patent rights vis--vis access by
the poor, quality assurance, and many others. This is the reason why the Law too
has many different interventions ready to address these critical and major issues.

What is the early working or Bolar provision and how does it help bring down prices
of medicines?

This allows development, testing, and experimental work for the registration of a
generic medicine to take place during the patent period of the innovator product.
Such development, testing, and experimental work may last from 6 months to 2 years.
Thus, this allows generic counterparts to be readily available and marketed the day
after the patent expires instead of 2 years after. In contrast, without Bolar
provision, a company may only apply for registration after the patent expires, in
which case, the effective life of the patent is extended subject to the time it
takes to complete said registration processes (usually 6 months to two years). By
exerting the early workings provision for patented medicines, generic competition
is facilitated and cheaper yet quality counterparts for expensive innovators become
available earlier in the market.

Who are involved in the implementation of the Cheaper Medicines Act?

The Secretary of Health has special powers to be able to make informed decisions
and ensure the full implementation of the Law. Such influence extends even to the
Local Government Units where the DOH shall actively engage in meaningful
partnerships to ensure the Law is followed.
The DOH is the main implementing and monitoring agency for Cheaper Medicines Act
but this is not a sole responsibility of the Department. DTI, IPO, FDA,
PhilHealth, PITC, PITC Pharma Inc. are all collectively working together to get the
intent of the Law done. Moreover, the Secretary can deputize any other government
agency for any purpose related to the implementation and apt enforcement of the Law
and its IRR.
Private Sector participation, partnerships, and advice are encouraged and sought in
terms of monitoring implementation, building capacity, and reporting violations of
the Law and its IRR.

Will Senior citizens discounts and discounts for people with disabilities still be
honored on drugs with MRP?

With the Power to regulate prices, why not just regulate all drugs and medicines
prices?

The Law recognizes competition as the primary instrument to attain the best price
and best quality for drugs and medicines through generics promotion. Competition
also encourages innovation so we can have newer and better drugs. However, in
instances that effective competition is not attained, the Law and its IRR provides
for regulations of prices as well as of all the other factors that contribute to
high and inaccessible costs of drugs and medicines. Thus, a balance between these
two may be best for our countrymen to reap the full benefits of quality affordable
medicines without compromising innovation for research for newer drugs.