The shortage of medicines in public health institutions, the Social Security Fund (CSS) and the Ministry of Health, and the high cost of these in private pharmacies are problems with which the Panamanian people are, unfortunately, all too familiar. The problem became visible in 2022 when it was reported that in the CSS, of the 610 basic medicines, there was a shortage of about 130, affecting 80% of the insured. In response, the now former president Laurentino Cortizo signed a decree to implement a 30% discount on 170 medicines in private pharmacies. Two years later, this decree has been extended again, as the problem persists.
Multiple factors have caused this shortage that mainly affects the Panamanian population, both insured individuals and private consumers. From the great demand accumulated globally after the resumption of production following the Covid-19 pandemic, the high costs of importing medicines into the country and the lack of national pharmaceutical infrastructure, to the complex bidding processes for the importation and distribution of medicines. This lack of public access to medicines has also generated a monopoly in the hands of the private market, which has led to price increases.
Faced with this complex problem that impacts a large part of the Panamanian population, particularly the most disadvantaged, what are the alternatives?
What is the solution?
One possible solution, both to the problem of shortages of medicines and supplies and to the high cost of medicines in private pharmacies, is the purchase of medicines through non-profit organizations, such as United Nations agencies. Panama could benefit greatly from these international mechanisms for the purchase of medicines and assistance in the procurement process. This is a proposal that the Panamanian medical association, COMENENAL, has been offering since before the 2022 crisis broke out, and which would solve part of the problem of shortages. So why has the Government not incorporated this system?
According to a study on the high costs of medicines in Panama by the Indesa group, no evidence was found that buying from these organizations was advantageous, since “the costs of buying from them did not really make the purchasing mechanism materially different”. The study also points out that perhaps if the purchases were not per individual country (4 million inhabitants) but as a whole (50 or 100 million inhabitants) “it could change the story”. However, this is contradictory to what we have observed in other Latin American countries with small populations. It would be interesting to explore why in Panama this option is perceived as unfavorable and why it is not considered a viable solution.
How does this system of comparison work?
Direct procurement from the UN agencies would be an attractive and viable solution, for which there is evidence in other countries in the region. In 2022, the United Nations recognized that the purchase of medicines through the United Nations Office for Project Services (UNOPS) is the best procurement modality available due to its high impact, sustainability, timely implementation, proven benefits, best practices, added value for the environment and contributions to achieving the 2030 Agenda for Sustainable Development Goals.
This project has contributed enormously to Mexican public health, for example. UNOPS is responsible for 28% of the total expenditure of the Mexican public health system for the purchase of medicines and medical supplies. In only two years, the opening of the market, which in 2018 concentrated 80% of public spending in 18 suppliers, to 80% of public spending divided among 99 suppliers, was achieved. As a reference, in Panama 83% of the largest imports of medicines are concentrated in 8 companies.
In Mexico, this system has also promoted transparency and public information on purchases and has strengthened public health institutions. The Health for Wellness Institute (INSABI) of the Government of Mexico reported that: “the specific agreement with UNOPS includes an institutional strengthening component, so that our country can consolidate an international supply chain, which was achieved before the established deadline.”
In Guatemala, the Ministry of Public Health and Social Assistance (MSPAS) has just approved the implementation of a system for purchasing medicines through UNOPS, a mechanism that had already been implemented through its Social Security since 2007 and which generated savings of US$200 without reducing the quality of the medicines. This system has also made procurement processes more efficient and transparent.
Honduras has also incorporated this procurement system through UNOPS with excellent results, generating a price reduction in reference medicines of between 40% and 300%. In addition, market participation was opened to a larger number of actors. The success of these agreements in neighboring countries, although with larger populations, but with similar problems, reaffirms that this is an encouraging solution.
Therefore, due to the instability of the Panamanian public system and its consequences on drug costs in the private market, I believe that direct purchases through the UN agency could be a good solution. A solution that would alleviate the already heavy burden of the Social Security Fund and benefit Panamanian public health.
*Machine translation proofread by Janaína da Silva
Autor
Researcher at the International Center for Political and Social Studies, AIP (Panama). PhD in Health Services Research from the University of Arkansas for Medical Sciences, with postdoctoral training in community-based participatory research from the University of Maryland, Baltimore.
