Assessing pricing and reimbursement policies for generic pharmaceuticals in the MENA region for improved efficiency, affordability and generic penetration

Bregtje W Kamphuis,Panos Kanavos

doi:10.1016/j.hpopen.2021.100045

Bregtje W Kamphuis, Panos Kanavos

Open Access

https://doi.org/10.1016/j.hpopen.2021.100045

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Abstract

BackgroundHealthcare systems in the Middle East & North Africa (MENA) region face challenges in healthcare service funding and delivery. Greater use of generics satisfies the objectives of macroeconomic efficiency and contributes to healthcare financial sustainability. ObjectiveTo examine and critically appraise the key features of supply- and demand-side policies for generic pharmaceuticals in eleven MENA countries. MethodsThis paper uses an analytical framework, informed by primary and secondary evidence, covering indicators across two themes: supply-side policies, including pricing, reimbursement and procurement policies for generic products, and proxy demand-side policies, particularly provisions for generic prescribing and generic substitution. ResultsEvidence from primary and secondary sources suggests that price capping with and without managed competition and external reference pricing (ERP) are the principal generic pricing policies in the region, while reimbursement and procurement of generics rely on tendering. MENA countries focus their efforts predominantly on supply-side policies to reduce cost, whereas demand-side policies, such as generic prescribing and substitution policies, are rarely in place, and if they are, they are not mandatory in the majority of cases. ConclusionThere are significant opportunities for MENA countries to tailor their generic policies more closely to their individual health systems to improve efficiency and cost-effectiveness. Owing to the region’s inherent mistrust in generics, supply-side policies may be insufficient alone to achieve the countries’ efficiency and cost-effectiveness aims. The eleven MENA countries should consider a more holistic approach and pair supply-side with demand-side policies.

Highlights

Healthcare systems in the Middle East & North Africa (MENA) region face challenges in healthcare service funding and delivery
In the MENA region, generic prices are often set through external price referencing (ERP) or price capping
Price capping Price capping is used in Algeria and Lebanon for both imported and locally manufactured generics, and in Jordan and the United Arab Emirates (UAE) for wholly locally manufactured generics

Summary

Introduction

Healthcare systems in the Middle East & North Africa (MENA) region face challenges in healthcare service funding and delivery. Health care systems in the Middle East & North Africa (MENA) region face challenges in the delivery of healthcare services due to a combination of a rising prevalence of non‐communicable diseases, economic and fiscal pressures, and, in some countries, renewed focus on universal health insurance coverage which exerts more pressure on health care financing. Average pharmaceutical spending as a percentage of health expenditure was 24.8% in 2016 across the MENA countries, compared to 17.4% across the OECD countries in the same year [3,4,5,6,7,8,9,10,11,12,13,14]. The gap between total and government health expenditure constitutes out‐of‐pocket spending; while most MENA countries claim they have comprehensive health insurance coverage, in practice incomplete coverage results in a substantial portion of pharmaceutical expenditure paid for out‐of‐pocket. 2018 data shows out‐of‐pocket spending as a percentage of current health expenditure ranged from 6% in Oman to 62% in Egypt [16]

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