Bitter Pills:Medicines & The Third World Poor | Page 54

governments need to obtain reliable drugs at the lowest possible prices. On the
other, the leading companies claim they need to charge high prices in relation to
other manufacturers to pay for their costly research establishments.
There are striking differences in drug prices from one market to another, between
different manufacturers and in the prices that the same producers charge different
buyers. Pricing is a complex issue, not least because of all the external factors
that influence prices, including the size of the market, the degree of competition
between similar products, the extent of government controls, taxes and the margins
added by wholesalers and retailers.
Recent cooperation between Caribbean countries on drug policies has unearthed
some major discrepancies in the prices of identical drugs. One supplier sold
methyldopa tablets (for high blood pressure) to Trinidad at six times the price
quoted in Barbados for the same quantity, and roughly three times the prices
charged in Guyana and Jamaica. Meanwhile the small island of St Kitts obtained
the same drug from another manufacturer under a group purchasing scheme for
about a ninth of the price paid by Trinidad. These and similar price differentials
cannot be explained away by different market size, or variations in freight and
insurance costs. (4)
An important factor underlying different prices between both developed and
developing countries is the degree of government price control. A recent UNCTAD
report reveals that in the Philippines, where the Government exercises few controls
on the market, prices are generally much higher than elsewhere. For example,
the least expensive tetracycline capsule cost over 8 times more than the cheapest
available in the USA and four-and-a-half times more than in neighbouring
Malaysia. Similarly in the Philippines Roche's products Librium and Valium were
priced 8 times and 14 times higher than in Britain. l5)

£14 FOR 100 ASPIRIN
Contrary to some popular misconceptions actual drug prices are not always higher
in developing countries. On a straightforward currency conversion, actual prices
are often much lower than prices in developed countries, even in manufacturers'
own home markets. For example out of 24 identical products marketed in
Bangladesh and Britain in 1980/81 by seven transnational companies, with two
exceptions, prices were all lower in Bangladesh."1'
But direct price comparisons can be misleading because they ignore vast differences
in purchasing power, in this case between the majority of people in Bangladesh
and in Britain. In terms of purchasing power the real cost of these products is
much higher in Bangladesh. One 60 ml bottle of Beecham's ampicillin syrup, sold
under the brand-name Penbritin, costs a poor family in rural Bangladesh about
66p -or 6% of their total monthly income. If a British family with a net income
of £7,000 a year had to spend the same percentage of their monthly income on
the drug, one bottle would cost them about £35. Similarly, the cost of 20 capsules
of ICI'soxytetracycline, Imperacin, represents 5.3% of the Bangladeshi family's
monthly income. So proportionately, this short course of antibiotics would eat
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