Two Silent Pandemics

A Reuters article discusses plans by global drug companies to reduce their prices for some drugs in developing countries - particularly those drugs aimed at chronic diseases.  The World Economic Forum thinks that conditions like diabetes, cancer, obesity will become a "silent pandemic" in developing countries as life expectancy improves.

Unless we are really careful, the second, unintended effect of price reductions in developing countries could be to set up a very profitable criminal arbitrage.  The conversion of low priced but genuine product, intended for third world markets, into higher-priced, identical products for the USA (for example) is a fantastic profit opportunity for organised crime and a potential second silent (but deadly) pandemic.

I support price reductions for the developing world - it will help to reduce the level of counterfeit drugs there and bring better healthcare to millions - but we must think through the consequences as well.

Maybe the global drug industry will become a much lower margin business.  That would please some, but it runs the risk of stifling investment and the killing the creativity of the pharmaceutical industry - love them or hate them, we all need "big pharma" if the cures of tomorrow are to be developed.

Better to make sure that governments and the drug industry invest in strong anti-counterfeiting and anti-diversion measures to accompany any price differentials, to minimise  easy profits for the criminals.

Photo: tobyotter