Pangaea Express: The World Health Organization (WHO) plans a fair pricing model for drugs 

July 29, 2016

By Marla Weingarten

As the price of medicines has become a global issue, the World Health Organization plans to develop over the course of the next year “a fair pricing model for pharmaceuticals”. Through stakeholder discussions with governments, patient groups and manufacturers, the WHO’s objective is to keep medicines affordable without discouraging drug makers from their research and development efforts for future discoveries.

WHO will investigate specific price drivers:

  • How do manufacturers set prices?
  • What are the R&D costs?
  • What strategies do countries, payers, and health systems use to manage prices and which are effective?
  • What is the return on investment required to ensure manufacturers continue to produce medicines?

The WHO also wants to determine the proper price setting process for drugs where the initial research is carried out by public institutions. Should a company that takes over the production of such a publicly developed drug be able to set a price at its own discretion?

They will also look at generic drugs from the pricing set by single source suppliers to the discontinuation of valuable drugs due to lack of commercial interest.

This eagerness to build more transparency into drug pricing is centred on the WHO’s ability to meet their “Sustainable Development Goals” by 2030 whereby “all countries must be able to provide full coverage for quality health services to their entire populations”.

Timing: A draft review is expected by the end of 2016 to set the stage for a broader discussion in early 2017.

It will be interesting to see the outcome of this WHO model. How much information will companies provide and will they really agree to a global pricing model??

For more information contact Marla Weingarten