Catherine Sasman
13 January 2009
Windhoek — Will the new medical formulary implemented by medical aid funds make medicine unaffordable for ordinary Namibians, or cheaper, while a battle between pharmacists and the funds erupts?
The Namibian Association of Medical Aids Funds (NAMAF) has made a decision to implement a Namibian Medicines Formulary (NMF) by March 1. The Pharmaceutical Society of Namibia claims this will have negative effects on the pharmaceutical market across the country, making a number of medicines not listed on the NMF unaffordable - and hence inaccessible - to members of medical aid funds.
NAMAF represents the nine registered medical aid funds - Bankmed, NMC, Nammed, Namdeb, Napotel, NHP, RCC Medical Aid Scheme, Renaissance, Woermann & Brock Medical Aid Fund - in Namibia, which provide medical aid to about 60000 members. It is a statutory body in terms of the Medical Aid Funds Act of 1995 that is the controlling body of medical aid funds.
The NMF, according to NAMAF, is a restricted branded formulary that only applies to some generic substitutable medicines. And according to the NAMAF decision, only the 400 approved and listed generic brands on the NMF will be payable by the registered medical funds. But, it added, generic equivalents of drugs listed on the NMF will not be reimbursed to their members, who will have to pay for those drugs from their own pockets.
The NMF allows access to two brands in any generic category where there are more than two brands available on the market. In categories where there are only two brands available - the originator of the brand and a generic equivalent - only the generic equivalent is listed, and therefore payable by the medical aid fund.
According to the Medicines and Related Substances Control Act of 2003, pharmacists are allowed by law to substitute any prescribed medicine (originator brand) with a relevant generic equivalent without obtaining prior consent from the prescribing doctor. The Act further makes it compulsory for pharmacists to inform all patients of the benefits of generic substitution, if a generic equivalent of the prescribed medicine is available.
The Act states that it is compulsory for pharmacists to generically substitute such prescribed medicine, unless the patients refuse these generic substitutes, or the available generic substitute is more expensive than the prescribed brand, or where the doctor prohibits substitution in writing.
"We are well within the confines of the law," stated CEO of NAMAF, Gabriel Mbapaha, who said that NAMAF is completely behind the decision on the NMF.
The overriding rationale for the NMF is financial.
But the Pharmaceutical Society claims otherwise, stating that industry players have not been consulted; the decision is essentially undemocratic because it limits the choice of drugs to the patient and it does not really make much financial sense.
The Society charged that it is NAMAF's expressed intention to make all Namibian medical aid funds use the NMF, and through that therefore control 100 percent of the insured market.
"Any entity trying to control more than 30 percent of the market contravenes the spirit of the Competitions Act," the Society maintained.
It added: "Under the NMF the member [patient or client of the medical aid funds] will not have the right to obtain the medicine of his/her choice if he/she is prepared to make the relevant co-payment if he/she chooses a medication not on the formulary. How can a member possibly be denied any cover at all if a certain monetary value has been approved for an active ingredient, but he refuses to take the one that generates a profit for the fund? That must surely infringe upon his right to fair competition."
It went on to say that patient-compliance and desired therapeutic outcomes could be jeopardised if patients, stabilised on a specific branded medicine, is to be switched to the formulary medicine.
"Since the choice of generic to be used is determined by the formulary and not by the prescriber [read doctor] or dispenser, the legal liability for any adverse medicine reaction will have to rest with NAMAF," the Society stated.
It further said that the procedure to select a medicine onto the formulary lends itself to the possibility that a more expensive generic may be chosen to the exclusion of a cheaper alternative.
The Society further claimed that the formulary arrangement further means that medicine destined for Namibia must be packaged separately from the bulk South African market, which could further endanger constant availability of medicine to Namibia.
Further, it stated, all products must then be registered in Namibia at a cost of N$3000 per application and an annual retention fee of N$1080. According to the society, pharmaceutical companies have indicated that they will not register products that are not on the formulary due to the miniscule size of the market remaining outside the NMF.
"We want to emphasise that no generic company in the past 10 years could provide a continuous supply on a like. Quite often the wholesalers had to import the original product after all the generic companies were unable to supply. If an original product is not registered in Namibia, the wholesalers will not be in a position to import the substance needed. For this reason the substance will not be available at all to the detriment of the patient."
Moreover, said the society, should products be considered for removal from the formulary, stock would not be able to be returned to South Africa due to the various costs like airfreight and others attached to such an exercise.
Mhapaha and the NMF trustees are adamant that wide-range consultations have been held with the local market, and that the NMF does make financial sense.
Johan Blignault, director of the trustees that run the NMF, said a recent NAMAF study (2007) on medical fund claims showed that about 25 percent of the total health care budget in the private sector is being used on medicines. This is the second biggest expense after hospitalisation expended by medical funds.
Effective additional payments made by members reached about N$40 million (or 19.1 percent) of the approximately N$200 million spent on medicine.
Blignault said generic medicine has the same effects on the body as originator brands, adding that of the 3373 different prescribed medicines currently available on the Namibian market, 2108 are original brands and only 1265 (or 37 percent) generic equivalents of original medicines.
He stressed that the NMF would only apply to the generic component of the market, and that the NMF therefore under no circumstances affects patients' access to medicines for which there are no generic equivalents.
"The funds will in future continue to pay for the drugs, subject to normal rules of the relevant medical funds.
"The impression created in the market is that medical funds in future will only pay for generic medicines, is completely ungrounded," Blignault said.
He further stated that current supplies of medicines would not be affected during January and February during the phasing in of the NMF, urging members to consult with their doctors to find out if their current treatments will be affected by the implementation of the NMF, and if so, to get new prescriptions from their doctors.
"It is further important to understand that the patient's doctor will still be in control of the patient's treatment. Should any patient react negatively [to listed drugs], or experience any side-effects on any of the preferred drugs on the formulary, the doctor of such patient can at any time prescribe an alternative drug, which will be paid by the funds, as long as the doctor provides clinical motivation to the funds."
Blignault said while contributions to medical funds increase on a yearly basis, so too are funds compelled to limit benefits on an annual basis.
"The annual increase in medical costs is currently making medical insurance for the man on the street unaffordable," Blignault added.
However, the society argued that medicine prices in 2009 will be cheaper than in 2003, with the average value of items sold by wholesalers today being approximately 35 percent cheaper than in 2003.
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