Ángela Flores, Executive Director, National Association of Pharmaceutical Manufacturers: Interview

Interview: Ángela Flores

How would you characterise the main challenges faced by the pharmaceutical industry in Peru?

ÁNGELA FLORES: The sector’s main challenges are largely a result of limited public expenditure on health care. Current spending figures stand at around 5.3% of GDP, below the regional average of 7.4% and less than the figures recorded by Chile and Colombia, which spend 8% and 7%, respectively. Health care spending should be seen as a future investment rather than as a cost, as increased economic competitiveness is strongly correlated to overall investment in health and education.

The pharmaceutical industry grew at a satisfactory rate of 6% in 2018, following a rather flat 2017, mostly due to delays and backlogs in public pharmaceutical tenders and marketing authorisation approvals. In fact, the over-reliance on state tenders – 50% of all bulk purchases are ordered by the government – is a key challenge to growth. This is followed by the subsequent inefficiencies in the public purchasing and tendering process as well as logistics challenges.

We believe the reverse auction system could be optimised by establishing a centralised purchasing scheme where innovative, risk-sharing mechanisms, such as digital catalogues and large storage, could be used for high-cost and/or high-risk products to avoid hold-ups. This could be used in the purchase and distribution of innovative medicines to treat cancer patients, for example, where delays in treatment can lead to a deterioration in outcomes. Peruvians should have access to their prescribed treatment in a timely manner. Private sector involvement, and its accumulated know-how in the establishment of effective logistical chains worldwide, is very important for the betterment of this area.

What can be done to improve and streamline institutional practices in public provision?

FLORES: The Peruvian public health system is highly fragmented, with multiple sub-systems within the official system itself. The Ministry of Health covers around 55% of the population, followed by the Social Health Insurance at 34%, and police and military health agencies at 6%. This leaves around 14% of the population with no form of official health coverage. To maintain service provision, it will be crucial to institutionalise and integrate the whole system to the highest degree possible. The General Directorate of Medicines, Supplies and Drugs (Dirección General de Medicamentos, Insumos y Drogas, DIGEMID) – the agency in charge of the quality, security and efficacy of the medicines approved in the country – should be granted the autonomy required to carry out its activities, especially as the complexity, resources and skills required to adequately provide care are expected to increase exponentially.

How can legal reform help fulfil the sector’s goals?

FLORES: The Parliament is discussing several reform initiatives, including amending and modernising the existing Law No. 29459 of 2009 dealing with pharmaceutical products and medical devices. Primarily, the amendments aim to guarantee that medications are of a high quality, through the interchangeability of generic drugs sold in the system. Other technical commissions are looking to improve the efficiency and transparency of regulation at DIGEMID. Hopefully, such reforms will also reduce the registration backlog for new medications, which can take up to 36 months, so that Peruvians have access to products that are safer, more efficient and, in some cases, the only therapeutic option for those with severe or rare diseases. Furthermore, the reforms should allow for the involvement of civil society and patients in the process of selecting which drugs to include on the Essential Medicines List.

Both the Parliament and Cabinet are studying new efficiency models to streamline the process of tendering and buying new drugs. In this regard, we are keen to promote the official establishment of a common code of ethics for the public medications sales process, with clear rules for all public and private parties involved.