In 1994 the pharmaceutical sector was characterised by lack of equity in access to essential drugs, with a consequent impact on quality of care. High drug prices, irrational use of drugs, and cost-ineffective procurement practices posed additional challenges.
A number of interventions have been implemented to address these challenges.
An essential drug list was compiled for the country by a group of experts for use in public health facilities, to ensure that appropriate medicines are available at the appropriate level of care. South Africa’s essential drug list is now used as an international model on the selection and use of medicines at various levels of care. This introduced levels of rigour in assessment of medicine selection.
In the public sector, the procurement systems have been amended so that government can achieve better prices for ARVs and other medicines, resulting in South Africa now having the lowest prices for these medicines in the world. The reforms to the public sector procurement are now being used as a benchmark for other procurement agents internationally.
In the private healthcare sector a transparent pricing system has been implemented that regulates the price of medicines in the supply chain from manufacturer through to the patient. This system reduced the cost of medicines in the private sector by over 20% with a compound reduction through regulation of the annual price increases.
However, government’s efforts to make medicines more affordable and thus more available to the public progress have not gone unchallenged.
In February 1998, the South African Pharmaceutical Manufacturers’ Association and 40 multinational corporations brought a lawsuit against the government for its passage of the Medicines and Related Substances Control Amendment Act No. 90 of 1997, arguing that it violated the Agreement on Trade-Related Aspects of Intellectual Property Rights. As a result of immense international pressure, the pharmaceutical companies dropped their case in April 2001 and the resultant lowering in pharmaceutical prices had an international impact.
– By The Presidency, 20 Year Review
