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Thailand Shows How to Cut Medicines Costs

Countries across Southeast Asia face rising rates of non-communicable diseases (NCDs). NCDs like heart disease, diabetes and cancer are the leading cause of death in the region. The government of Thailand is taking action to cut the cost of critical treatments for patients by eliminating unnecessary tariffs and exposing hospital markups.

Thailand has the highest average tariffs on medicines in Southeast Asia (9.3%) and taxes the greatest number of medicines in the region. The Council of Ministers of Thailand agreed to exempt the importation tax on orphan drugs, which are considered medicines with relatively low everyday use. Dr. Thares Krasnairawiwong, Secretary-General of the Thai FDA, said this new measure “will help the Government Pharmaceutical Organization (APS) and private entrepreneurs support government agencies in procuring orphaned drugs and reducing the cost burden so patients can access essential medicines.” This tax exemption is a step in the right direction and a policy that Thailand should continue to advance to drive costs down.

Additionally, the Department of Internal Trade recently collaborated with the Faculty of Commerce and Accountancy at Chulalongkorn University to study factors affecting drug pricing at private hospitals. The study analyzed medicines, medical supplies and services in the hospital setting and found that some make profits of more than a 100 percent on medicine markups.

In order to provide transparency and improve patient access to medicine, the Department of Internal Trade has set up guidelines to identify the private hospitals with the most fair drug pricing schedules and has invited them to participate in the Moral Hospital Project, in which the government celebrates these institutions and publicizes their commendable practices.

Thanks to treatment breakthroughs and wider health care access, people across Southeast Asia are living longer than ever before. Thailand is helping lead this charge by working to make life-saving medicines more affordable for its citizens.

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