On 23 March Statistics SA released the annual consumer price inflation (CPI) rates, sending waves of worry throughout the country as we braced ourselves for another ripple of price increases across the board.
Everything’s going to cost more
The CPI was 7% in February, up from 6.2% in January, breaching the SA Reserve Bank’s target range as well as the dubious achievement of hitting the highest rate since May 2009, when it was 8%.
This means everything – food, transport, housing, medicines – is going to cost us more.
With the cost of medication already putting quality healthcare out of the reach of most South Africans – as this mother who was denied possibly life-saving cancer treatmentcan confirm – we’re asking: Will we ever improve the SA life expectancy age of 58.83 years for women and 54.74 years for men?
It’s important to know that the sustainability of the healthcare system – and the national economy – depend significantly on the availability of affordable medicines.
MSF’s access campaign officer, Julia Hill says, “When desperately needed drugs are too expensive, people pay both with their wallets and their lives.”
What’s driving up the cost of medicines and healthcare in SA?
- Low SA growth forecast for 2016: 0.7% and 0.8%
- Cost of medical products increased by 4.9% over the last year
- Lack of foreign investment in SA
- Low job creation and increased unemployment
- Rising debt levels
- Depreciation of the South African rand
- High cost of imported medication
- Price increase of 4.8% for pharmaceuticals
- Deep segregation between private and public healthcare facilities
- SA’s lax patent laws that allow pharmaceutical companies to get multiple patents on the same medicine, blocking more affordable generic competitors from bringing products to a market beyond the 20 years required by international trade agreements
- The price of private healthcare in South Africa (that services 16% of the population) has increased by 300% in the last 10 years, moving from R42bn in 2002 to R142bn in 2014
See infographic: How much money generics could save South Africans
What can be done to bring prices down?
- Large pharmaceuticals must invest directly in SA, thereby supporting the local economy.
- Pharmaceuticals must focus on local manufacturing facilities to boost production of local medication.
- The South African Health Products Regulatory Agency must streamline the approval process of new medicines to enable greater access to medication for patients.
- Government must increase investment into the development of generics and biosimilars.
- Government must invest in specialists to conduct clinical research locally to develop new medicines relevant to the continent.
- Greater investment into the direct distribution of pharmaceutical products to the various Government depots, clinics and hospitals nationwide.
- Increased competition between generic medicine manufacturers to further drive down the cost of medication.
- Transfer of the logistical and distribution costs of medicines to the suppliers to avoid delays, additional transport costs and stockouts.
- Department of Trade and Industry must establish a proper patent examination system that prevents the granting of low-quality patents to large pharmaceutical companies, and put in place legal safeguards that limit the abuse of market dominance by patent holding companies. This could help bring patents more in line with those given out internationally and put affordable medication in the hands of patients.
- Reform of South Africa’s patent laws to prevent abuse of patent monopolies by pharmaceutical companies.
- Department of Health must address the cost differences between private and public healthcare by reducing huge administrative costs and brokers in the latter and improving public health services.
The Department of Health has attempted to reduce the cost of medicines by introducing a single exit price system as well as setting a dispensing fee for pharmacists.
Use this handy tool to:
- Know what to expect to pay when you get a prescription from your doctor.
- Find possible generics for a branded medicine.
- Ensure that you are not being overcharged for your medicine.
How the 2016/2017 SA health budget will be spent:
The health budget will be R168.4 billion in 2016/17, of which R31.9 billion will be for primary healthcare services, R88.2 billion for hospitals, and R15.9 billion for HIV/Aids treatment and prevention.
The private sector spends about R66-billion to service approximately 7 million people, while the rest of the population depends on R59-billion spent through the public health sector.