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After a long dry spell, the pharmaceutical research industry has brought to market a spate of innovative treatments that can extend life and often have fewer side effects than older treatments. But these medicines are not affordable to most of the people who need them. Recent treatments for hepatitis C and cancer – both widespread conditions globally – can cost from $50,000 annually to well over $150,000.
Amid public outcry, political battles and media articles, no one seems to understand how, exactly, medicines prices are set. For years, pharmaceutical research companies have cited the large investment of time and resources that go into bringing a drug to market. More recently, they argue that their medicines are actually saving money by preventing expensive medical interventions like surgery and hospitalization.
But whatever the argument used, the price setting mechanisms for commodities that are inextricably linked to people’s health and survival must be made more transparent so that we can, as a global community, devise effective solutions.
To that end, the World Health Organization is planning to convene governments, patient groups and industry stakeholders to develop a fair pricing model that can affordably deliver the medicines needed by patients while keeping companies interested in developing new and better treatments and producing generic treatments. That model will need to hinge on greater transparency in industry’s research and development and marketing approaches; it will also need to understand what the inputs are into price setting, as well as the barriers companies face in bringing new products to market.
In late 2015 we entered the era of sustainable development, with universal health coverage at the center of global health efforts. That means that by 2030, the deadline for the Sustainable Development Goals, all countries must be able to provide full coverage for quality health services to their entire populations. The only way we can reach that objective is to enter a social contract between the public and private spheres so that innovation and generic production can respond effectively to global public health needs – both in the quality and effectiveness of the treatments, their availability, and their affordability.