Research

Evaluating the impact of single exit pricing (SEP) on medicine product withdrawal from the private healthcare market in South Africa

K Naidoo, F Suleman

Abstract


Background. The introduction of medicine pricing policies in South Africa (SA) in the form of single exit pricing (SEP) provided a mechanism to improve medicine price transparency and reduce the medicine price and inflation. However, regulation of medicine prices may have further unforeseen effects on the availability of medicine. This research presents the impact of SEP on discontinuation of medicine products on the private healthcare market in SA.

Objectives. To evaluate the impact of SEP legislation on the availability of medicines in the SA private health sector in terms of withdrawal of medicines from the market.

Methods. A descriptive, quantitative analysis of all registered medicines on the SA market by stock-keeping units (SKUs) was done to establish medicine products that were withdrawn from the market by SKUs during a 14-year period (2001 - 2014).

Results. A total of 152 manufacturers discontinued 3 691 SKUs between 2001 and 2014. The mean number of discontinuations per generic manufacturer was 22.34 (standard deviation (SD) 58.11), while innovator manufacturers discontinued a mean of 27.61 (41.89). The largest number of SKUs were commercially withdrawn in 2002 (n=603), followed by discontinuations in 2003 (n=463) and 2004 (n=407). There was a negative correlation between number of discontinued SKUs per year and SEP increase (Pearson’s correlation coefficient r ‒0.414; p=0.14). The results showed that SEP and a transparent pricing policy may have had an impact on SKU withdrawal from the market prior to SEP implementation.

Conclusions. The result of reduced product availability on the market and its impact on the cost and quality of healthcare to the patient need to be regularly monitored and evaluated to ascertain if direct price regulations achieve the intended outcomes. Other intended or unintended effects on pharmaceutical market dynamics should also be evaluated.


Authors' affiliations

K Naidoo, Discipline of Pharmaceutical Sciences, School of Health Sciences, Westville Campus, University of KwaZulu-Natal, Durban, South Africa

F Suleman, Discipline of Pharmaceutical Sciences, School of Health Sciences, Westville Campus, University of KwaZulu-Natal, Durban, South Africa

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Keywords

Medicines; Policy; Pricing; Withdrawals; South Africa

Cite this article

South African Medical Journal 2021;111(5):444-447. DOI:10.7196/SAMJ.2021.v111i5.15297

Article History

Date submitted: 2021-04-30
Date published: 2021-04-30

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