Oxfam: 85 percent of the world is priced out of the drug industry's market
While pharmaceutical companies are often portrayed as cunning entrepreneurs, they don’t always make perfect business decisions. So says Oxfam, whose new report suggests that drug firms are ignoring a potentially mammoth market by failing to make drugs affordable for people in the developing world.
To date, 85 percent of the world's population is priced out of the industry's market, the report says, and the anti-poverty charity suggests “prices for essential medicines need to be tiered, in line with people's ability to pay.”
"The industry is operating in a short-sighted way,” Oxfam's head of research Sumi Dhanarajan told the BBC, “because it could gain enormous benefits from emerging markets, including lower development costs and cheaper manufacturing. Yet instead it continues to blindly use the same strategies in poor countries."
Many of the world's biggest drug firms have done next to no research on illnesses that affect the world’s poor. According to Oxfam, “Between 1999 and 2004, there were only three new drugs targeted at diseases affecting the developing world out of 163 drugs brought to market.”
Sick citizens of developing countries could certainly use the drugs. One million people die of Malaria every year while 2 million people perish annually from TB.
Pharmaceutical companies contend that high prices are necessary to finance research and development, which accounts for billions of dollars a year. "High taxes" and pharmacists and dispensing doctor mark-ups also push medicine prices higher, they suggest.
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