OVERSIGHT COMMITTEE FINDS DRUG IMPORT SCHEME A FLOP

THE PARALLEL Drug Importation program of the Department of Trade and
Industry and Department of Health is a flop, according to a
congressional oversight committee tasked to monitor the Executive
branch's compliance to the pledges made by President Macapagal-Arroyo
in her 2001 State of the Nation Address.

The program is intended to reduce medicine prices by importing
low-price medicines from India for sale at accredited hospitals at
prices far below those of multinational pharmaceutical companies and
commercial sellers in the Philippines.

The committee's finding was revealed by its chairperson, Albay
congressman Jose Sarte Salceda, who recommended that the trade and
health departments get an allocation of five billion pesos for the
purchase of medicines from India and that they explore other options
under the new policies adopted by the World Trade Organization at the
WTO meeting in Doha, Qatar, last year.

The program is a pet project of Trade and Industry Secretary Manuel
Roxas II, who has advocated reducing medicine prices since he was a
congressman. He had also pursued it when he was trade and industry
secretary of former president Joseph Estrada.

In his report, Salceda said the program hardly caused a ripple in the
market since the volume of importation, at 75 million pesos, accounted
for only 0.16 percent of the total turnover in the pharmaceutical
industry in 1999.

Roxas had previously promised to increase the outlets for the
low-price medicines from 30 to 300, including private drugstores and
hospitals, and expand the list of medicines in the program from eight
to 30.

A survey by the congressional oversight committee showed that while
prices of some medicine decreased, the reduction was nowhere near the
50 percent that the trade and health departments had reported and
which the President promised in her speech in July 2001.

The committee said a check on the inventory of hospitals where the
medicines were available showed that these were sold at a very slow
pace.

The survey also showed that most of its respondents had been led to
believe that the promise of the trade and health departments to bring
down prices applied to all drugstores, both government-owned and private.

Salceda said the qualification by the two departments that the
medicines were available only in selected government-owned and
government-accredited hospitals and outlets, was not acceptable to the
committee and the public.

He said the failure of the program could be partly blamed on the
meager budget allocated for it, because most of its funding was
uncertain and it depended largely on the budget of the Department of
Health. He said the program needed a substantial budget of five
billion pesos to attain its objective. Salceda said the program's
proponents had also set unrealistic goals that, even if they had
achieved them, were unsustainable.