The high cost of medicines in Panama is a widespread and known fact and of special interest to the State. The government has initiated debates on reform of the Medicines Law as part of its agenda. However, the solution lies not only in the hands of government, because there are various contributing factors concerning the processes of distribution and supply of medicines. 

The objective is to secure a steady supply of safe, quality medicines, at the best cost and in the shortest possible time, to avoid the monthly high price increase. 

Why these fluctuations?

Mr. Daniel Abrego, general manager of Intercontinental Logistics Corp (ILC) explains that in this industry there are costs associated with the distribution chain, the size of the markets (volume of demand), and the prices of APIs (active ingredients) that directly affect the cost. In addition, we must not ignore the margin of handling and clearance errors that make the logistics of distribution more expensive and result in an increase in prices. And we cannot forget the high margins that distributors and laboratories use to mark up a product. 

Variables to consider 

Panama does not have a government subsidy for the acquisition of medicines due to low comparative demand, but given the situation, a more appropriate solution is necessary in place of putting pressure on distributors or pharmacies to reduce prices. And to find an answer we must ask ourselves what products we are offering, whether they are branded, generic or pure generic. Abrego believes the wise solution is to maintain a continuous improvement in purchase management and price consultation, in the storage and in the type of products. Recurrent corrective measures related to purchase management, quality validation and dispatch to the local distributor, pharmacy or government institution must also be in place. This is in addition to exploring other modalities such as direct dispatch to the pharmacy, or the evaluation of generic medicines suppliers (laboratories) to reduce costs without affecting quality. 

Specialists agree that to decrease the cost of medicines, one must consider technical, operational, quality and commercial aspects. It would be advisable to look for new, less expensive providers who secure the drug in pharmacies at the lowest cost, and to purchase generic medicines and put price control in place on certain therapeutic areas. 

How to guarantee the quality of these generic medicines? 

  1. Opt for FDA or EMEA certified plants only 
  2. Buy products that have free sale certificates from high standard countries
  3. Validate the quality of the medicine through a reference laboratory, which samples the quality of each lot that enters the country to be marketed. (Such as the IEA, Instituto Especializado de Análisis in Panama for instance.) 

New needs 

Some of the emerging needs in Panama include modernizing the processes related to the pharmaceutical sector. For example, streamlining the registration processes, testing models to reduce distribution costs, giving high-quality and low-cost medicines such as generics a chance, and outsourcing storage, inventory and conditioning operations. These are some of the solutions that could be brought to the institutional market.