MINIMUM OF 1.6 EUROPEANS PER HOUR AT RISK OF DEATH
DUE TO PHARMACEUTICAL PRICE CONTROLS

BRUSSELS, 01 JULY 2004 — A new report, The Human Cost of Pharmaceutical Price Controls in Europe: A Case for Reform, published today by the Centre for the New Europe, the Brussels-based think tank, analyses the impact on patients of price controls on pharmaceuticals.

A PDF copy of the full report, by Stephen Pollard, Dr. Sean Gabb and Alberto Mingardi is available at http://www.cne.org/pub_pdf/2004_07_01_humancost.pdf.

The key findings are:

1. On the conservative assumption that one per cent of patients heavily dependent on their medication are worried by well-founded reports of counterfeiting into not taking their medication as recommended by their doctors, 370,000 people throughout the European Union are at any particular moment at risk of death or serious decline in their quality of life.

2. Taking this figure and averaging it throughout the year, over 42 people per hour can be seen to be at risk of death because of some of the problems raised by attempts to reduce the price of pharmaceutical products within the European Union.

3. Confining this to the populations most at risk as the main destinations of parallel imports – Britain and Germany (140 million) – and further reducing the figure of those not taking their medication from one per cent to 0.1 per cent., the figure is 14,000 per year – or a potential death rate of 1.6 per hour.

Contacts
For more information, please contact:
Dr. Tim Evans (President, CNE) +32 2 506 4000 or on +44 7956 969523
Stephen Pollard (Senior Fellow, CNE) +44 07956 118035
Dr. Sean Gabb +44 07956 969523

Key Extracts
The ‘seen consequence’ of pharmaceutical price controls is to hold down medical costs, allowing wider access at any one time to treatment than would otherwise be the case. Its ‘unseen consequences’ however are to diminish the range of treatments available in the long term, and to increase medical costs; and to kill or otherwise to harm patients throughout the western 15 member states of the European Union.

Price control will in the long term reduce the number of new products introduced to the market. And this may actually increase pressure on health budgets. Money spent on pharmaceutical products is, of course, a cost. But it is also a cost saving, taking into account often larger amounts of money that would otherwise need to be spent on less effective forms of treatments.

Today, more than 140 million medicines move around the European Union each year. All of them have to be tampered with. Products marketed by the manufacturers can be tracked through the entire chain from factory to patient by means of elaborate computer systems. Defective products can be identified and recalled with very little difficulty. This is not the case with parallel imports. Parallel trading provides the route to counterfeiters for the introduction of their substandard products in to the distribution chain.

In 1990, it was estimated that an average of 20 per cent of the population of a developed country are on some form of prescribed medication, and that half of this figure covers medication that is required for the continuation of life or to avoid a catastrophic decline in quality of life. This being so, we can calculate that 74 million people in the 15 member states of the non-expanded European Union are on medication, and that 37 million are in more or less desperate need of their medication.

The numbers of people known to have died or been seriously inconvenienced by incorrectly labelled or counterfeit pharmaceutical products are not significant. However, the numbers of people alarmed by media reports of these problems into suspending use of their medication are significant.

Let us, therefore, assume that at any particular moment, one per cent of patients heavily dependent on their medication are worried into not taking their medication as recommended by their doctors. That gives us a figure of 370,000 people throughout the European Union at any particular moment at risk of death or serious decline in their quality of life. If we take this figure per year and average it throughout the year, we arrive at a figure of just over 42 people per hour who might die because of some of the problems raised by attempts to reduce the price of pharmaceutical products within the European Union.

These are conservative assumptions, but we can make them more conservative still. Let us confine the populations at risk to the main destinations of the parallel imports – Britain and Germany. This gives us a reduced population of around 140 million. Let us further reduce the figure of those not taking their medication as prescribed from one per cent to 0.1 per cent. This still gives us a figure of 14,000 per year – or a potential death rate of 1.6 per hour. .

The Centre for the New Europe (CNE) is a pan-European policy research institute based in Brussels.