A CORE SET OF INDICATORS TO

CHARACTERISE AND ASSESS THE

DISTRIBUTION CHAIN IN THE

PHARMACEUTICAL SECTOR

Valérie Paris – OECD Health Division

Global Forum on Competition28 February 2014, OECD, Paris

• OECD: a few questions in previous Product Market Regulation survey; # of pharmacists in OECD Health Statistics

• WHO– European Health for all database: # of pharmacists and

pharmacists graduated– WHO pharma country profiles data and reports: #

pharmacies and pharmacists; accreditation of pharmacies ; inspection and quality controls for distributors, implementation of good distribution practices, pricing policy, distribution mark-ups and taxes; public sector procurement and distribution; private sector distribution

• PHIS information system (European countries): – Density of POM dispensaries; type of price regulation at

manufacturer, wholesale and pharmacy levels, taxes on pharmaceuticals and reference prices systems

– PPRI and PHIS Country profiles: regulation of wholesalers and retail distributors; # of wholesales and retailers; regulation of mark-ups

Information regularly published on pharmaceutical distribution

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Propose a core set of indicators (qualitative and quantitative) for a possible data collection in order to:

• Describe the regulation and characteristics of the distribution of pharmaceuticals in countries

• Assess the effectiveness of a country’s distribution chain

Taking account availability of data for a maximum of countries

Objectives of the presentation

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Regulation• Regulation of ownership and licensing;• Regulation of vertical integration of retailers;• Public service obligations: range of products (full- vs short-

liners), delivery delays;• Regulation of mark-ups;• Regulation of discounts to pharmacies.Market structure• Number of wholesalers by type• Market concentration.

Regulation of wholesalers and market structure

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Wholesale remuneration scheme – out-patient sector 2010

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Price control at wholesale level

Scope of medicines Type

AT Yes All medicines Regressive mark-up/marginBE Yes All medicines Regressive mark-up/marginBG Yes POM Regressive mark-up/marginCZ Yes Reimbursable Regressive mark-up/marginDE Yes POM, reimbursable OTC Regressive mark-up/marginDK No - -EE Yes All medicines Regressive mark-up/marginEL Yes All medicines Linear mark-up/marginES Yes All medicines Regressive mark-up/marginFI No - -FR Yes Reimbursable Regressive mark-up/marginHU Yes All Regressive mark-up/marginIE Yes Reimbursable Linear mark-up/marginIT Yes Reimbursable Linear mark-up/marginLT Yes Reimbursable Regressive mark-up/marginLU Yes All medicines Different6

LV Yes All medicines Regressive mark-up/marginMT Yes All medicines Linear mark-up/marginNL No - -PL Yes Reimbursable Linear mark-up/margin

Note: The table is incomplete, Source: PHIS database, available at https://phis.goeg.at

Regulation- Types of retailers allowed to distribute medicines (POM

and OTC): pharmacies, dispensing doctors, other outlets, internet retailers

- Regulation of ownership for pharmacies (Is ownership reserved to pharmacists? Can a pharmacist own several pharmacies?)

- Regulation of establishment of new pharmacies? (Quotas per population; Distance between pharmacies; other)

- Service obligations for pharmacies (Regulation of opening hours; range of products, provision delays)

- Regulation of mark-ups and/or retail prices.Market characteristics- Number and density of retail POM dispensaries (by type)

Regulation of retail distribution and number of retailers

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Pharmacy remuneration scheme – out-patient sector 2010

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C. Price control at pharmacy level

Scope of medicines Type

AT Yes All medicines Regressive mark-up/marginBE Yes All medicines Regressive mark-up/marginBG Yes POM Regressive mark-up/marginCZ Yes Reimbursable Regressive mark-up/marginDE Yes POM, reimbursable OTC Different

EL Yes All medicines Linear mark-up/marginFR Yes Reimbursable Regressive mark-up/marginHU Yes All medicines Regressive mark-up/marginIE Yes Reimbursable Linear mark-up/marginIT Yes Reimbursable Linear mark-up/marginLT Yes Reimbursable Regressive mark-up/marginLU Yes All medicines DifferentLV Yes All medicines Regressive mark-up/marginMT Yes All medicines Linear mark-up/marginNL Yes POM FeesPL Yes Reimbursable Regressive mark-up/marginPT Yes POM, reimbursable OTC Linear mark-up/marginRO Yes POM Regressive mark-up/marginSE Yes POM Regressive mark-up/margin12

Note: The table is incomplete, Source: PHIS database, available at https://phis.goeg.at

Manufacturer’s selling price+ Mark-ups added on at various points of the supply chain+ National and regional taxes + VAT- Discounts and rebates+Fixed pharmacy fee, dispensing fee or prescription fee= retail price

Outcomes: Assessing distribution costs

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Outcomes: Distribution costs

Some data are also availableon mark-ups observed on essential medicines in M&LIC from ad-hoc surveysor studies by WHO-HAI)

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Outcomes: Assessing availability of medicines

• Density of POM dispensaries, geographical distribution and/or distance to the closest dispensary;

• Occurrence of shortages in supply - Monitoring of product shortages is sometimes available at national level

• Actual availability more difficult to measure, especially in M&LIC (WHO-HAI conduct surveys in outlets)

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Outcomes: Quality of supply

• No simple indicator to measure quality (of services and products)

• Density of pharmacists or health professionals with a minimum training in pharmacy can be used as a proxy for the quality of service (POM)

• The existence of policies of on inspections and control of distribution facilities and/or products (collected in WHO country profiles) are indicators of process

• Data on counterfeit medicines are scarce (but in expansion)