Collusion practices inflate medicine prices

Collusion practices inflate medicine prices

By K. Basrie

JAKARTA (JP): Although he no longer chairs the influential
Indonesian Medical Association, Kartono Mohamad remains
authoritative in medical affairs.

He is now chief editor of Medika health magazine.

When leading the association from 1985 to 1994, he submitted a
list to the health minister at the time, Adhyatma, of 500
practitioners he alleged colluded with pharmaceutical industries
and inflated medicine prices.

"The minister turned a deaf ear to the report," says the 57-
year-old former navy medical staffer and writer of Legal Aspects
and Medical Ethics in Indonesia.

Kartono shared his views in an interview with The Jakarta Post
on the state of current medical affairs in Indonesia. The
following are excerpts:

Question: What's your opinion about the current price of
medicines in Indonesia?

Answer: Medicine is too expensive for most people. For
instance, a five-gram tube of penicillin costs over Rp 10,000
(US$4.25). So how could ordinary people like those in remote
villages afford to buy it?

My recent comparative study in Bangkok on drug prices in
Indonesia and Thailand found that medicine in Indonesia is much
more expensive than in Thailand.

Yet the Indonesian government and the pharmaceutical industry
insist that not all types of medicine are costly. They may be
right, but I do not know of any medicine that is cheap in this
country.

People consider that prescription drugs are very expensive,
but the government and the pharmaceutical industry don't think
so.

Health authorities claim the prices of certain types of
medicine are almost the same as those in Singapore. It seems to
me they ignore the difference between Singaporeans' and
Indonesians' buying power and per capita incomes.

What about drug prices in other countries?

Thailand has a per capita income of $2,680 (Indonesia's is
$940) but medicine is cheaper there. Some types of medicine in
Bangkok are twice as cheap as those here.

In Singapore, the price is slightly lower than it is here but,
keep in mind that their per capita income is much higher
($26,400) than ours.

People point their fingers at the government's slack control
of the pharmaceutical industry, the greed of some businessmen and
doctors and patients with no bargaining power in the situation.
What do you think?

I absolutely agree, although I know many parties reject this
idea.

The government is not serious in controlling the
pharmaceutical industry and this problem has been going on for
many years. In the past, it let the pharmaceutical industry
mushroom, disregarding the actual market demand.

Consequently, 250 factories operated below capacity and set
high prices to compensate for the high overhead costs. Had the
government controlled the number of factories in the early years,
I believe it would have resulted in efficiency, which would have
led to lower drug prices. I don't know why the government made
such a mistake.

But the rule of thumb shows the more factories, the lower the
prices would be, doesn't it?

That happens with other products. It's wrong to assume that
doctors will readily recommend cheaper drugs for their patients.
The government's slack control allows drug producers and doctors
to dictate prices, while consumers have nothing to fight it with.

Many doctors just scribble the prescription and don't care
about prices and their patients' financial conditions because
they never buy drugs. Drug producers know how to collude with
doctors and exploit this situation.

What may the corrupt doctor receive from the drug producer in
return?

It depends on the amount of profits raked in. I could show you
a noted specialist who got a car from such a conspiracy.

How reliable is the medicine recommended by such a doctor?

They don't care. What they would choose is the drug whose
producers offer the best "deal", while the patients are ignorant
of the conspiracy.

Corrupt doctors never run out of tricks to blackmail drug
producers. For example, some practitioners will threaten to
boycott certain medicines unless the supplier or producer gives
them money to attend seminars.

Isn't such a practice in violation of the practitioners' code
of ethics?

They do violate their oath and code of ethics. It is rampant,
and nobody does anything to stop it. Neither do the
pharmaceutical industries and their partners, which compete with
each other.

How many doctors are involved in this dirty business?

Their number is less important than the fact that the practice
exists, often well-organized. The blackmailed suppliers or
producers do not dare do anything for fear their products will be
boycotted.

Are there any public officials involved in this business?

Yes. It is common for officials to use their power for
personal benefits. Many drug companies have complained that they
have been blackmailed into providing cash amounting to hundreds
of millions of rupiah (by the certain people in power) for
dubious purposes. To make up losses, they inflate the prices of
their products.

What has the doctor's association done to help victimized
patients?

When I was chairman of the association, I brought a list of
over 500 corrupt doctors along with a bulk of material evidence,
such as receipts of illicit levies, to the then-health minister,
Adhyatma.

I urged him to take stiff measures against the doctors who we
believed had caused medicine prices to soar as the result of
their conspiracy with pharmaceutical industry owners. But the
minister never took action against the culprits.

Our efforts ended up in the trash bin. It seems that the
government is not concerned at all about this problem.

What about the Indonesian Consumers Foundation?

What the foundation does is no more than advocacy. Moreover,
the House of Representatives is not supportive of the agency.
Anything it does without the House's support is useless.

Why do customers never complain?

Even I am surprised. Maybe it is because our society is
fatalistic. But I believe the educated class should do something
to mend the situation.

What is your suggestion?

Simple. Make this topic an open discussion in the media, so
everybody -- including the government, the public and the
industry -- can do something.