The United Arab Emirates' Ministry of Health and Prevention has announced the seventh round of major drug price reductions, with the prices of 762 innovative medicines to be reduced by between 5% and 63%.
Implications | The UAE's seventh round of major drug price reductions is intended to boost access to a range of innovative treatments and includes 574 more medicines than the sixth round conducted in August last year. |
Outlook | The MoH detailed that the price reduction will be applied to 657 medicines from 1 September, while the prices of the remaining 105 will be reduced from 1 January 2017. A full list of the revised prices will be published this week. |
The United Arab Emirates' minister of health and prevention, Amin Hussein, has announced that 752 innovative medicines would have their price reduced by between 5% and 63%, reports the media source Arabian Business. He made the announcement before representatives of international pharmaceutical companies as well as delegates of the 11 pharmacy chains across the UAE.
The Ministry of Health and Prevention (MoH) stated that the price reduction would be applied to 657 medicines from 1 September, while the prices of the remaining 105 would be reduced from 1 January 2017. The MoH also stated that a list indicating the revised prices and their date of applicability would be published on its website this week.
According to several local sources, this new round of price cuts involves mainly innovative medicines for the treatment of central nervous system, cardiovascular, and health-related diseases, including gastro-intestinal disorders.
According to local newspaper Gulf Today, the MoH and the regional organisation of pharmaceutical manufacturers will next year launch a study to assess the need of implementing price cuts on generic medicines as well.
Outlook and implications
The UAE's seventh round of major drug price reductions is intended to boost access to a range of innovative treatments and includes 574 more medicines than the sixth round conducted in August last year (see United Arab Emirates: 31 August 2015: Prices of 188 innovative medicines to be cut in UAE from 2016). Price cuts worth AED267 million (USD73 million) on 8,725 pharmaceutical products have been made since the initiative was launched in July 2011 (see Sub-Saharan Africa - United Arab Emirates: 24 February 2016: UAE has reduced the prices of 8,000 drugs in last six rounds of cuts).
The MoH seeks to use the savings achieved with the implementation of this seventh round of price cuts to support patients suffering from chronic diseases. The MoH argued that this new price reduction would facilitate access to innovative medicines at affordable prices, lowering them to levels similar to those in Turkey, Algeria, and Egypt. This measure is likely to be widely welcomed by payors (see United Arab Emirates: 5 February 2013: UAE to introduce drug pricing scheme, cost of 6,619 medicines expected to fall by up to 40%).
The MoH price cuts were also introduced to encourage multinational drug makers to produce treatments in collaboration with local manufactures. The UAE's policy of allowing foreign producers to collaborate with domestic manufacturers has enabled firms to pass on lower shipping costs to patients in the form of lower drug prices.
Despite the fact that lower drug prices are likely to help the UAE rein in healthcare spending and improve patient access to innovation, the frequent pace of price cuts has been a challenge for the innovative pharmaceutical industry and could reduce international companies' confidence in investing in the market. Furthermore, new rounds of pricing cuts and the extension of this policy to generics cannot be ruled out.