The Well-Informed Patient

I write my column The Well-Informed Patient in TCS Daily on 11 March 2005.

Liberty and efficiency in Europe's pharmaceuticals markets

Since the 19th century the traditional role of European governments has been to provide health care for their citizens. But times have changed and so must Europe's health systems. The first area in which adjustments need to be made are the strict regulations that exist for medical drugs.

The first sign that changes are on their way is a recent case in the European Court of Justice in Luxembourg, where Sweden has come under scrutiny. The Swedish government has for more than 30 years held the retail monopoly on pharmaceuticals. The only place where Swedes can buy their medicines is in government run stores -- regardless of whether they are prescription or non-prescription. The socialization of pharmacies was a kind of compromise reached when the social-democratic government failed to socialize all pharmaceutical companies. Consumers had less political clout than corporations. Since then Swedish consumers have had to endure bad service, centrally decided prices, no competition, and frequent scandals as a result of the government monopoly. This situation will most probably change now since Advocate General Phillippe Léger has recommended the dismantlement of the monopoly to the European Court of Justice. A verdict is expected soon.

Although a government run monopoly on retail drugs makes Sweden unique (except for countries like Cuba, Libya and North Korea), many other European countries have only slightly less strictly regulated pharmaceuticals markets. One of the main arguments for the strict regulations is that they help the patients. The patient is seen as lacking the sufficient knowledge to make his or her own decisions on how and when to choose a medication. Why are consumers able to make their own decisions based on advertising when buying cars, breakfast cereals or pension schemes, but not drugs?

The regulations and advanced tests required for newly developed medicines have in many cases helped to make drugs and therapies safer, but they have also elevated the costs. The regulations' main problem is their tendency to give artificial advantages on the market place for big corporations. Not many companies have the strength to wait for the successful drug that pays for failed ones. It is not surprising that companies are pressured into lobbying doctors to buy their products, since they are prevented from communicating with their real customers, patients.

In the 1960s it took about three years to develop a new drug. Today it takes 10 to 12 years, mainly because of the strict regulations for approval. All the big pharmaceutical companies are desperate to find few "blockbuster drugs" to pay the enormous costs of failed experiments and R&D.

Politicians are worried that new drug therapies and unregulated markets will raise health care costs. So to prevent this they regulate drug markets even more and tighten the guidelines under which medicines and drugs should be made available. The next step is to increase control over physicians and what medicines they prescribe to their patients - in other words, no more expensive therapeutic medicines and drugs are to be given. The only alternative is to give only second generation medicines or generics to patients, all in the name of cutting expenses in the medical systems around Europe.

European healthcare systems are mainly financed by taxes. This forces health care administrations to focus on costs instead of benefits. There are always areas in need of trimming. This is going to be a futile search, and in the long run hospitals around Europe are going to lack the excellence needed for the continent's ageing population.

Another fear for bureaucrats and doctors alike is the increasing knowledge the internet brings patients. The patient often now comes to the doctor armed with the latest information on his specific illness and medical condition, and a clear picture of what alternatives are given in other EU countries. Many see this as a major problem, but it should instead be seen as a positive development. It is better that patients are knowledgeable rather than ignorant on health issues.

In the future the well-informed patient is going to become even more independent, and in the long run this will enable health care systems to focus on benefits instead of costs. But if this is to happen, a free flow of information must be established on the pharmaceutical market in the EU between health care agencies, corporations and patients alike- removing the bans on drug commercials.

The Swedish case shows that the EU at its best can be an agent for freer markets and consumer choice, with the European Court of Justice forcing the government to open up this important market. But will the rest of Europe follow in this positive trend?