Generic Drugs Can Reduce the Economic Burden of Diabetes!

Diabetes is rising like an epidemic in India. According to Diabetes Atlas 2017 published by International Federation of Diabetes, 72.9 million people are living with diabetes in the country. This number is expected to become 134.3 million by years 2045. Moreover, 42.2 millions of Indians are living with un-diagnosed diabetes, which constitutes 57.9% of the total population living with diabetes. The number of patients living with diabetes is bound to increase in the near future due to ongoing large-scale urbanization and increasing life expectancy.

Diabetes is a physiological state in which there is a persistently higher level of glucose in the blood. This situation may adversely affect the organs like eye, heart, kidney, and skin to name a few. According to reports, a person living with diabetes has two times higher chance of getting a heart attack, which is a major cause of mortality in the case of diabetes. With the progression of diabetes, we witness the comorbidity and hence increase in the cost of diabetes management.

The economic burden of diabetes has two components namely direct cost and indirect cost. The direct cost includes consultation fee, medicine cost, and hospitalization cost. The indirect cost includes the cost of travel and the cost of lodging, as patients have to travel from remote areas to urban areas, to avail the healthcare facilities. Another indirect cost associated with diabetes is a loss of productivity due to illness.

Need not to say, the burden of diabetes on total health care spending is likely to increase in the coming future. This situation will have important consequences on the sustainability of health care financing. To make the condition even worse eighty percent of healthcare spending in India is out-of-pocket (OOP). Any major health event in the family can make a family poor. Due to its chronic nature and existence of comorbidities medicines constitutes a major portion of the direct cost in case of diabetes. Financing and delivery of health care in India has been left largely to the private sector, hence the government has little control over the cost of medicine prescribed.

One approach to bring the medicine cost in chronic care like diabetes down is the prescription of generic drugs. Generic drugs are bioequivalence of brand-name drugs that have exactly the same dosage, intended use, effects, side effects, route of administration, risks, safety, and strength as the original drug. The pharmacological effects of branded drugs are exactly the same as those of their generic counterparts but are being sold at an exorbitantly higher price compared to generic drugs.

The major challenge in the adoption of generic drugs is distrust from both patients and doctors towards its effectiveness and quality. In addition to this, the prescription of generic drugs hurts the profitability of the healthcare providers as well as pharmaceutical companies. Indian healthcare is dominated by private hospitals, which constitutes more than 75% of the total healthcare being provided. The combination of generics as a percentage of original drugs may work well for all parties. The policymakers need to come up with an incentive strategy for generic drug prescription. The provision of financial incentive to doctors can further strengthen the development of generics market. In countries like France, bonuses are awarded to doctors who have high prescription rates of generics. Ministry of health should launch awareness campaigns targeting the general public about generics safety and bio-equivalence. According to Kobayashi et al (2011), Japan’s health ministry has issued a handbook with the authorized medicinal products and their therapeutic equivalence evaluations in order to inform both patients and healthcare professionals for the generics. India can emulate the same for better acceptability of the generics.

According to the Indian Brand Equity Foundation (IBEF), India is the largest provider of generic drugs globally. Indian pharmaceutical sector industry supplies over 50 percent of global demand for various vaccines, 40 percent of generic demand in the US and 25 percent of all medicine in the UK. The confidence of patients and doctors in generics can be increased by ensuring the quality of the processes at pharmaceutical companies producing these drugs. These companies should use ISO-quality management system certifications and follow rules of good manufacturing practices (GMP).

As already discussed, the comorbidity increases with the progression of diabetes. This situation results in the inclusion of more advanced drugs in the prescription. In most of the cases, drugs prescribed at this stage are new in the market and their generic equivalent is not readily available or popular for that matter. Moreover, with medical intervention, the average life of the people living with diabetes has increased. This means the economic burden of diabetes drugs has significantly increased and bound to even increase in the future. The increased inclusion of generic medicines in the prescription can significantly bring the cost of care down in case chronic disease like diabetes. The government needs to act swiftly to address the rising burden of diabetes drugs by promoting the prescription of a generic drug in India.

(The author is Assistant Professor (Operations Management) at FORE School of Management,

New Delhi)

The Article originally publish in ETHealthworld: 

https://health.economictimes.indiatimes.com/news/industry/generic-drugs-can-reduce-the-economic-burden-of-diabetes-dr-vinaytosh-mishra/69439891