An Analysis of the 2014 Moroccan Drug Price Cuts

Abstract

The Moroccan government announced new public and hospital prices for 5308 drugs in April 2014. These price cuts came into force in June 2014. The study examines the price changes and analyzed the potential impact of the price cuts on pharmaceutical companies operating in the market. Standard statistical Methods were used to analyze government provided data in order to identify general trends within the pricing notification. Secondary sources were then examined to determine the general pricing rationale. The price notification included 5308 drugs (note duplication occurs where a brand name has multiple formulations). Examining public prices: 390 of the drugs were newly listed on the list for public purchase, a further 2968 saw no price increase and two drugs saw modest price increases. Public price declines were seen for 1948 drugs with the level of decline covering a range of 1635 percentages between 0.006% and 78.6%. Average public price, excluding drugs with no decline, saw an average decline of 13.6% and median decline of 6.5%. All the 5308 drugs already had an existing hospital price, however 114 of these drugs saw no pricing change. Of the 5194 drugs which did see a price decline this varied across a range of 2559 different percentages between 0.001% and 79.8%. The average hospital price decline, excluding drugs which saw no decline, was 9.3% and the median was 5.8%. The large range of pricing declines suggests that the prices were not indicative of a formulaic event such as currency fluctuation changes. This also means that there is a differential impact on pharma companies, with certain parts of their portfolio being more protected than others.