Hailed as a landmark piece of legislation almost two decades ago, Republic Act No. 6675 — more popularly known as the generics law — has unfortunately suffered from years of lax implementation.

by ALECKS P. PABICO

AMONG ALBERTO Romualdez Jr.'s saddest experiences as a physician, one that he says he continues to encounter, involves his regular trips to the drugstore. "You cannot miss this scene," shares Romualdez, who was the health secretary during the brief presidency of Joseph Estrada. "Somebody with a prescription, say for antibiotics for one week, comes up to the sales clerk and pleads, 'This is the only money I have. Is it possible to buy just one or two tablets or whatever this amount can afford?'"

"The poor," he continues, "will spend all their money, give as much as they can bear, which is usually too much for them especially if it concerns catastrophic illnesses."

Romualdez laments how medicines, including essential, life-saving ones, are priced way too steep beyond the reach of ordinary Filipinos. It's an anomaly that he blames primarily on unregulated free-market forces that wreak havoc on the country's healthcare system.

Indeed, compared to the demand side, the supply side — the pharmaceutical industry — is so dominant that it can dictate whatever price it wants. As a result, next to Japan, the Philippines has the highest drug prices in Asia. It's almost as if the country had no law aimed precisely at bringing down the cost of medicines to levels the masses could afford.

Table 1: Comparative Retail Prices of 100 Units (Tablets/Capsules) of 12 Commonly Used Drugs in Five Developing Asian Countries and Canada, July-September 1995 (in US$) Source: Issues Concerning High Drug Prices in the Philippines by Prof. Joseph Lim (1997)
DRUG NAME	STRENGTH (in mg)	CANADA	INDIA	INDONESIA	NEPAL	PAKISTAN	PHILIPPINES
Amoxycillin	250	8	9	10	8	5	22
Amoxil	250	14	10	40	9	8	29
Tagamet	200	25		56		14	95
Cotrimoxazole	48	6	5	7	3	3	20
Septrin	480	6		25	3	5	53
Odofenac	50	30	2	48	2	7	25
Voltaren	50	46	2	52		18	37
Erythromycin	250	6	12	10	10	5	20
Erythrocin	250	9	11	37	11	7	35
Adalat	5	28	2	18		2	40
Inderal	40	15	8	74		28	25
Zantac	150	81	3	150	3	39	95

Table 2: Price Comparison of Selected Generic Drugs between the Philippines nd Selected ASEAN Countries (in PhP) Source: A Comparative Study of Drug Prices in the Philippines and in ASEAN Countries by DOH and DTI (1999)
DRUG NAME	PHILIPPINES	THAILAND	INDONESIA
Penicillin G	9.8	4.83
Rifampicin	4.5	11.49	5.58
Nifedipine	4.15		1.78
Tetracycline	3.45	0.64	1.3
Glibenclamide	3.45	0.93	0.99
Pyrazinamide	2.15	3.17
Amoxicillin	2.14	4.27	2.68
Chloramphenicol	1.95	2.21	2.68
Cotrimoxazole	1.55	0.97	1.05
Prednisone	1.55	0.44	0.54
Mefenamic Acid	1.35	0.91
Metronidazole	1.07	0.94	0.99

In 1988, though, the Philippines, ahead of everyone else in Asia, enacted a law on generics in consonance with the national drug policy of the then fledging democracy under President Corazon Aquino. Helping usher in an era of social-reform measures, Republic Act No. 6675 sought to promote, require, and ensure the labeling, prescribing, and dispensing of medicines using their generic names.

Eighteen years later, the consensus among stakeholders in the healthcare sector — government agencies, generic-manufacturing companies, distributors, and nongovernmental organizations — is that the implementation of the landmark Generics Act has been for the most part a blow hot, blow cold affair. No less than the health department admits that its enforcement has not been that good.

"In fact, it's somewhat dismal," says health undersecretary Alexander Padilla. But then he also says the law itself is defective, because he sees it as bearing the mark of the strong pharmaceutical lobby that insisted on the right of doctors to continue prescribing branded medicines.

"While the law compelled doctors to issue generic prescriptions," says Padilla, "it also allowed them to continue prescribing the branded equivalent of their choice, the net effect of which has been to nullify generics altogether."

Dr. Eduardo Banzon, vice president of the government Philippine Health Corporation (Philhealth) and a health economist, does not go as far as describing the generics law as flawed. But he agrees with Padilla that it has suffered from weak enforcement. While consumers are now familiar with the generic names of several popular over-the-counter branded medicine such as Tylenol (paracetamol) and Ponstan (mefenamic acid), he says that people still do not ask for the generic equivalents.

"How we've implemented the law hasn't empowered consumers enough," he says. "We need to push for it more."

FOR SURE, despite Padilla's misgivings, the crafters of the generics law had tried to cover all bases so that generic medicines would have a fair chance in the market. Drugstores, for instance, were supposed to have a generics menu visible and accessible to customers. They were also to remind consumers about available generic equivalents of branded medicines. Each doctor's prescription, meanwhile, had to have the generic name of every medicine a patient was told to take. Even medicine ads carried a brand's generic name.

Table 3: Cost Structure of Pharmaceutical MNCs Source: Interview with a pharmaceutical company official For every peso of the price of medicines that Filipinos buy, drug companies spend for the following:
COST (in centavos)	NATURE OF EXPENSES	DESCRIPTION
40	Product transfer price	price of the medicine as bought by the subsidiary from its “mother company” based abroad (almost all the foreign drug companies are merely into distribution and no longer engage in drug manufacturing in the country)
20	Promotions	expenses incurred by drug companies for sponsoring doctors’ seminars, conferences and foreign trips, as well as advertisements and other endorsements to sell their products
15	Sales force expenses	mainly for the salaries, vehicles and other benefits provided to medical representatives
12 to 18	Distribution costs	discounts offered to pharmacies and drugstores
5 to 8	Medical expenses	clinical trials, market research and surveys

In the United States, which passed a generic-drugs law just four years ahead of the Philippines, generic drugs now have a 50-percent market share. By contrast, so-called "true generics" still account for a measly three percent of nominal drug sales in this country. Prices of branded medicines should decrease by 50-60 percent when a generic equivalent is introduced in the market — but only if consumers start buying the latter in sizeable quantities, thereby putting a challenge before the branded-drug makers.

That generic medicines are barely making a mark can in fact be traced largely to Padilla's very own department. As it has turned out, the implementation of the generics law depends on the zeal of who heads the Department of Health (DOH), which monitors compliance with Generic Act's provisions, particularly among doctors and drug outlets. (See status of compliance with specific provisions of the generics law)

When Dr. Alfredo R.A. Bengzon headed DOH, a nearly 100-percent compliance rate was registered particularly among government hospitals controlled by the department. At the time, the DOH put forth the vision of "health as a right" rather than a privilege of the few.

This encouraging trend was more or less maintained when Dr. Juan Flavier Jr. (now in his last term as a senator) succeeded Bengzon as health secretary. "He even had a (mascot), Eric Generic," recalls Romualdez of Flavier's effective media campaign to promote generics.

Unfortunately, the health secretaries that came after Flavier — Dr. Hilario Ramiro Jr., Dr. Carmencita Noriega-Reodica, and Dr. Felipe Estrella — did not seem to have given much attention to generics. Says Romualdez: "It was still part of the program, and I'm sure they were all in favor of the generics law, but they were not too hot about it. Kaya medyo napabayaan (That's why it was neglected a bit)."

By the time he assumed the Cabinet post in 1998, Romualdez says the compliance rate had fallen below 50 percent. "So we had to start all over again, always doing monitoring, asking for hospital records and so forth," he says. "By the time I left (in 2001), it was again at about 80 percent, more or less."

Today the situation appears to have returned to the post-Flavier years. Pastor Joseph Lee, manager of Botika Binhi, a nationwide nongovernment village pharmacy initiative that has been around since the early 1990s, attests to the vigorous promotion of generics and the support his organization received during Flavier's time. But he rues that the enthusiasm of those days has declined over the years. "It's harder now," he says. "We really feel the lack of support."

Padilla, for his part, puts the compliance rate at 30 to 40 percent, "50 percent at the maximum," which he attributes to poor monitoring and weak penalties.

Penalties for violating the generics law include reprimands, fines, the maximum of which is P10,000, suspension of licenses of doctors for a year at the most, and six months to a year behind bars. But Joshua Ramos, deputy director of the Bureau of Food and Drugs (BFAD), says the perception is nobody really gets penalized, given that the government seems to be having a hard time keeping track of what doctors, hospitals, drugstores, and pharmaceutical companies are doing.