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Registration of generics is a matter of competition, increasing the availability of drugs

The law prohibits Russian doctors from entering into commercial relations with pharmaceutical companies - otherwise unscrupulous doctors, taking advantage of lack of knowledge among patients, can impose expensive drugs on them, keeping silent about cheaper and similar generics. But drug manufacturers are constantly looking for new ways to promote their products, including bypassing the existing rules, and the existing controls are often ineffective. Is it possible to find a balance of interests of all these market participants and how this problem is solved in other countries, said Timofei Nizhegorodtsev, head of the social control and trade department of the Federal Antimonopoly Service (FAS) of Russia, in an interview with «Prime».

How does FAS evaluates the situation with pharmacists imposing drugs, with the manufacturers of which they have signed marketing agreements? Do you think you need to remove such pharmacists from work?

All over the world, pharmaceutical companies are trying to influence doctors to prescribe certain drugs to patients. The problem is built around medical professionals, and pharmacists are secondary. Russian law prohibits commercial relations between pharmaceutical companies, medical professionals and pharmacists. However, unfortunately, the sanctions imposed on violators cannot be called serious. In my opinion, penalties here are an archaic and ineffective tool of struggle. Why? Because for some doctors and pharmacists, they may be excessive, and for others - completely insignificant.

In countries where the struggle against this dangerous phenomenon has been conducted for a long time and quite effectively, the mechanisms of exclusion from medical and provisional activities are applied. We have no such practice. In addition, I don’t know a single case where Roszdravnadzor would conduct an investigation and apply a fine to some organizations. That is, this, in principle, does not attach much importance, which is very bad, since this is one of the central issues of fair competition in the drug circulation market. After all, such violations make it impossible for the patient to choose.

Many people say that by our initiatives we deprive the doctor of the right to choose when prescribing treatment to patients. But it is not. Only a doctor has the right to prescribe a drug. Moreover, the prescription must be written out according to the international non-proprietary name (active substance), which characterizes the therapeutic activity of the medicinal product, in equivalent formulation and dosage. By this, he realizes his right to choose therapy. Then the patient can contact the pharmacy, ask him to give him the entire list of drugs with this active ingredient, the appropriate formulation and dosage, and choose a medicine based on its budget.

Today in developed countries, even wealthy people use inexpensive drugs. They understand that there is no difference between the original drug and the generic. In our country, patients are often intimidated. They are told stories based on personal experience, looking confidentially into the eyes, and at the same time receiving money from pharmaceutical companies. Behind this story, appropriate control is needed. The Ministry of Health should clarify to people that generics are copies. It should also monitor the interaction of doctors, pharmacists and pharmaceutical companies. If this task is not seen and not performed, then the population is left alone with the pharmaceutical giants. People do not have special knowledge to protect themselves from them, and when they are also intimidated about the non-identity of drugs, this is a real problem.

In the roadmap for the development of health care competition, you have a proposal to oblige pharmacies to offer the buyer a cheaper equivalent of the drug. How is work going in this direction?

This story is hard to develop. A federal law must be passed obliging pharmaceutical workers to offer low-cost counterparts. Then we immediately dismiss a whole layer of unscrupulous practices. Compliance with this requirement shall be verified by test purchase. This should be part of the licensing requirements for pharmacies.

What effect does FAS plan to achieve by re-registering prices for drugs from the list of Vital and essential drugs (VED)? How much can prices go down? What was the result of the re-registration work done last year?

Since the antimonopoly service was transferred to the functions of the Federal Tariff Service, including an economic analysis of marginal prices for medicines, we have done a great job. We managed to reduce 1.08 thousand registered prices for expensive drugs from the list of VED. The average decline was about 43%, but there were also leaders, drugs that reduced prices 10 times. This work clearly showed the inefficiency of the old pricing methodology, which was based on a cost analysis. On the one hand, it led to an increase in drug prices, and on the other, it discriminated against Russian manufacturers. Therefore, the Russian government decided to develop a new methodology that would take into account modern approaches to price analysis based on objective indicators that are difficult to manipulate. Since January 1, the prices of drugs that are now in the list of vital and essential drugs, we have already recorded a new method.

Are pricing requirements for generic and original drugs different?

It is important to understand that drugs are divided into two groups: original (reference) and reproduced. Reference is in 90% of cases, the first time registered innovative medicines. The second and more significant part of the market is reproduced drugs, copies of the reference ones. Their common name is generics. They are registered on the basis of comparative studies with original drugs, which are to establish their full equivalence to each other. That is, generic drugs are no different from reference drugs, and are identical in their effectiveness.

Registration of prices for these two large groups of drugs varies. Original drugs are registered in Russia based on a comparison of prices for them in reference countries, as well as taking into account the prices stated when the drug is included in the list of Vital and Essential Drugs.

The price of generics is recorded depending on whether it is of Russian origin or foreign, of biological nature or chemical, first or not first. Based on this, the so-called reduction factors are established, which depend on the cost of the reference drug: in the amount of 5% for reference drugs cost from 500 rubles, and up to 60% for drugs worth more than 100 thousand rubles. Moreover, the reduction factors do not apply to drugs worth up to 500 rubles. In some countries, these levels of decline are higher than in the Russian Federation, in some countries - slightly lower. We are somewhere in the middle of the levels of rates of decline.
However, it so happens that manufacturers, having the opportunity to register prices higher, themselves come out with an offer to register a price lower. Thus, not only a comparative analysis shows that these reduction factors are not too burdensome for manufacturers, but also the manufacturers themselves demonstrate that for them these slats are very comfortable.

In general, with regard to prices for reproduced drugs, they cannot and should not cost more than the original drugs. Manufacturers of generics do not invest in the development of a new molecule, they come with their drugs to an already established market in which demand is formed. Their investments are much lower. At the same time, it is impossible not to note the fact that the generic is valuable for the market and for the consumer in that it makes the medicine available with the same therapeutic effects as the original drug. It is thanks to generics that drug prices sometimes drop 10-20 times.

It turns out that the opinion that generics are worse than original drugs is a stereotype?

Yes. Today, around this stereotype unfolding active unfair activity. Any pharmaceutical company sets itself the task in any way to generate demand for its product. For this, it interacts with doctors, patient organizations, pharmacists, whose task is to direct this demand to its product. The main dramaturgy of this activity is to spread false ideas that the original drugs are better than reproduced, and some reproduced are better than the original ones. But all this is not true. The meaning of the whole story lies in the fact that a generic can be registered only if it shows the same therapeutic activity as the original drug.
I repeat once again: the generic itself does not provide any therapeutic advantages, it only reproduces the therapeutic properties of the original drug. Therefore, registration of generics is a matter of competition, increasing the availability of medicines.

You said that some manufacturers register prices below the maximum allowed. Does this model of producer behavior lead to dumping?

If they offer a very low price to be chosen, then they can afford it. Nobody will work at a loss. Of course, there are cases when a company can set the price below cost, but this is rare. However, there are very strong price reductions. For example, recently the company reduced the price 24 times from the permissible level established by the methodology. They had the opportunity to set a price of 6.5 thousand rubles, and set - 211 rubles. Imagine the depth of the fall? At the same time, when there were discussions of this case, a company representative said that their profitability was 20%.

In the current rules for registering prices, as well as in the draft law, which provides for the revision of prices, which is currently being discussed in the State Duma, there are mechanisms that protect against dumping by foreign manufacturers. For example, if a foreign manufacturer reduces the price in the Russian Federation, but does not reduce it in the reference countries, then generic drugs may not lower their price if there are decreasing factors for this price group.

After re-registration prices will decrease. But can a situation occur when it becomes unprofitable for a number of manufacturers to sell certain categories of drugs in Russia?

Only those prices that were unreasonably high are reduced. Previous experience, which I mentioned above, shows that prices can be reduced by an average of 30-40%.

Could there be a risk of washing out some drugs from the market due to re-registration of prices?

Due to re-registration no. We do not demand anything extraordinary from manufacturers. Drugs are washed out of the market due to the fact that they were previously registered at an inadequately low price. Due to the fact that the pricing mechanism is conservative, it did not allow these manufacturers to sharply equalize prices. Therefore, they were forced to leave the market.

When we discussed this issue in the government together with the Ministry of Health, the Ministry of Health said that “falling out” drugs have analogues and there should not be any problems with their availability on the market.

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