E-DRUG: informal pharmaceutical sector

Dr. Kizito --

Thanks for your recent note to the e-drug forum on the informal distribution
of pharmaceuticals.

I'm an American doctor (Internal Medicine) and lawyer from Harvard, just
finishing up a Fulbright project in Yogyakarta (Java), Indonesia on the
subject of the economic and health consequences of information flow (or the
lack thereof...) in the local pharmaceutical market. Informal distribution
in Indonesia is a HUGE problem, which I believe to have an extremely
important and deleterious systemic (i.e., pathophysiological) effect in
addition to the two problematic outcomes (i.e., symptoms) which you mention
(i.e., corruption leading to a lack of equity & widespread irrational
self-selection of medications).

Specifically, I am finding that informal distribution acts as an enormous
barrier to the development of market self-corrective mechanisms in the
pharma sector, by imposing large information costs and by exacerbating the
usual pharma sector economic problems of information assymetry and agency
control.

Some anecdotes from various components of my study:

1) in a neighborhood survey which asked a cross-section of citizens about
medication purchasing and use behavior, my hired interviewers (two
anthropology students from a major local university) reported to me that
they were extremely surprised by the "fanatical" level of devotion they
witnessed among people they interviewed to an evidently quite famous
("terkenal") black-market toko obat (medicine shop) on the outskirts of town
here. I've visited the place, and it is apparently nearly always swamped
with people purchasing all manner of traditional and Western (i.e.,
manufactured) medicine. When I spoke with the customers about why they were
there, they reported to me that they had great faith in the prescribing
powers of the elderly Chinese gentleman running the shop, and that by coming
and describing their illness to him, and then buying whatever he
recommended, they i) saved on the time and expense of visiting a
Western-style doctor; and ii) felt like they were about as likely to get
better doing this as they were after having been to a doctor's office or
community health center. Having visited these places as well, and having
seen the quality of medicine routinely practiced there (or rather, the
appalling lack thereof...), I'd certainly have to agree with their second
point, and given their average income level, it's hard to fight very hard on
the first point, either.

2) in an different targeted-buy survey, in which hired surrogate customers
visited both apoteks (apothecaries) and toko obats (medicine shops) and
purchased antibiotics either without the legally required prescriptions (in
the case of the apoteks) or *at all,* in the case of the toko obats (which
are not legally allowed to sell any form of so-called "obat keras"), my
buyers were successful in nearly every case (depending on the precise
numbers you look at, anywhere from 85-100% of the time). In the few
instances in which they weren't successful, the apoteker informed the buyers
that he was reticent to sell them the medication himself (in several cases
since he had recently been closed down for doing so), but that my buyers
were free to go to a specific nearby apotek which made a practice of selling
drugs without prescriptions, and in fact felt quite free to do so since it
was owned by the local head of POM, the regulatory agency charged with
enforcing the very drug control laws this particular apotek was flagrantly
violating. There you go.

My point with both of these anecdotes (and the perhaps less-colorful hard
data which I will present at the 1rst WHO/INRUD ICIUM meeting in Chiang Mai,
Thailand in April) is that in the distribution of pharmaceuticals, as in
most other aspects of life, a regulatory dam never could stop an incentive flow.

As long as decent medical care is haphazardly available at best, and often
of appallingly poor quality when it is; as long as bureaucrats with lists
set import targets which are incredibly easy for companies to manipulate
with a little clever transfer pricing; as long as legal systems do not
respect hard-earned property, and are little more than veiled excuses for
the extortion of the weak by the strong; as long as a "guild" mentality more
concerned with protecting income than with protecting health rules the
established medical professions in many developing (and developed...)
countries; as long as the rules change more with your income than with your
competence -- so long will people continue to go outside the established
system to meet their needs, especially needs so pressing as one's own
serious illness or the illness of a loved one.

While this may be an annoyance to those charged with the collection of data
on health demands in the pharma sector (and, as a partner in that particular
crime, I'll felt the frustration it causes down to the bottom of my
soul...), from another perspective it really must be a very good thing,
since informal distribution of medicines at least allows some form of access
to important drugs (like antibiotics...) for those who might otherwise be
entirely bereft of the opportunity.

Dr. Kizito, isn't it really time to go beyond the established bureaucratic,
regulatory, command-and-control paradigm (which is already almost collapsing
of its own ancient, dusty, creaking weight...) and try to use the enormous
body of literature and knowledge which has been gathered by thousands of
profit-oriented companies on influencing and manipulating market behavior in
the developed countries -- but for slightly more laudatory purposes than the
pursuit of the almighty dollar, like, for instance, the health of poor sick
people?

I think a more productive approach would aim not just to fix the problems,
especially problems of a primarily statistical nature, but rather to fix the
system. Once people's incentives are correctly structured, the problems
tend to go away by themselves.

Bryan Walser, MD, JD

(Pusat Studi Farmakologi Klinik dan Kebijakan Obat,
Harvard Drug Policy Research Group, and the
Boston Consulting Group, Los Angeles --

but the opinions expressed above are entirely my own, and not necessarily to
be attributed to my sponsors.)

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