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Meeting on increasing the efficiency of medication supply system

November 16, 2018, St Petersburg

Vladimir Putin held an offsite meeting on measures to increase the efficiency of Russian medication supply system at the GeroPharm plant in St Petersburg.

The participants discussed the accessibility of medicines, the mechanisms for quality control of pharmaceuticals, and the practice of purchasing medications for benefit-entitled individuals within the framework of regional procurement.

Before the meeting, the President inspected the GeroPharm plant and its laboratories.

After the meeting, Vladimir Putin visited one of the city’s pharmacies to see if it had essential and vitally important medications available at affordable prices.

* * *

President of Russia Vladimir Putin: Good afternoon colleagues!

We are at an interesting enterprise. I have had a brief look at it. I hope you have also seen it. I was very happy to learn that those who organised this process and established this enterprise did so from scratch and at the highest levels. I am indeed impressed that they found specialists, took the first steps and developed industrial production at the highest levels. They hold a solid position in the market and are now working on promoting their products further in external markets. They are already working on this and also have good plans to expand production. This applies not only to insulin but also to other medications with unique properties, of top quality, and with a good economic component.

We are here for a reason. The day before yesterday, World Diabetes Day was observed, and I decided to see where we stand in this area and, to be honest, I was pleased to see what we have here.

The launch of the new production line – a full-cycle production line from substance to pharmacy ready, is certainly a good and special achievement, primarily for people suffering from diabetes, and there are 4.5 million diabetics in this country – as of last year.

The plant plans to produce insulin on a scale that will fully meet our requirements for this medication. You already hold 30 percent of the market and this is a decent figure.

I would like to emphasise again that upgrading living standards and prolonging life span is a key goal of national development. Everything should be built around these goals for our people, including our national projects and programmes.|

It is possible to successfully counter many ailments, including the most serious ones – primarily through advanced medical technology and new generations of medicines. Science and biotechnology in particular are making rapid progress.

When we launched the project for a children’s blood cancer centre in Moscow with Ms Golikova, I recall the indicators from the efforts to combat these dangerous diseases in this country. What was the survival rate?

Healthcare Minister Veronika Skvortsova: It was up to 15 percent and now it stands at 90 percent.

Vladimir Putin: Think about what a difference this is! And this figure applies to the country as a whole. This is what new technology can produce if purposeful efforts are made – not only financial (of course, you will get nowhere without money) but also organisational and administrative. In this case everything works out fine.

We are seeing this in the Russian pharmaceutical industry. Almost 3,000 domestic medications fully meeting quality and safety criteria have been registered in the past six years.

Last June we discussed with Government members ways of enhancing the efficacy of pharmaceutical provision of the population. Today we will continue discussing this matter with the participation of members of the State Council Presidium.

This is important because the regions of the Federation bear the brunt of the burden and responsibility for providing people with medications. But this is not about how powers are delegated, not at all. The main point is to provide people with the required assistance regardless of where they live.

In general, over 380 billion rubles from the budget are spent each year on drug provision in this country. We must understand clearly how efficiently these funds are used and whether they make it possible to relieve the cost burden of vital medications on people.

I will speak in more detail about access to subsidised medications. Some 19 percent of our citizens receive them during out-patient treatment. This is a good figure but in practical terms, in far from all regions do the authorities know how many people are entitled to subsidised medications, how many are using this benefit and under what state programme.

What does this mean? This means that if there is no proper accounting, budget money is slipping through our fingers very often. Still worse, not all people entitled to subsidised medications receive them.

Inequality in benefit funding is an alarming factor. In 2017, the average cost of medications per benefit recipient varied across different Russian regions more than sevenfold. I can understand a difference of a few percent, maybe twofold, but sevenfold is too much.

The lists of medications available to benefit recipients vary as well. I will not name these regions, but in one region, this list included a total of 554 medications, while in others it included only 317, and even 180. This also will not do.

Note that I am not even naming these regions so as not to offend anyone; we will talk about this later, without the media present. So what does it mean? People, citizens living in the neighbouring regions – I am talking about the neighbouring regions in the centre of Russia – so the people can communicate with each other. One gets a medication, while another one nearby does not. Why? We cannot explain it to people. In fact, there is no need for explanation – we simply must ensure that the system is functioning properly.

As a result, people entitled to benefits often have to pay for their medications on their own. This means that in certain regions, people get their medication with discount prescriptions, while in others they simply have to pay for it. And there is every reason to be angry about this state of affairs.

What we are left with is the fact that the current system for supplying beneficiaries with medications is, unfortunately, inefficient, and does not take into account individual needs.

It is obvious that we need to get the regions under control in terms of both registries of eligible citizens and the lists of medications they need.

We have been dealing with these issues on the federal level for several years, and have created a special information and analytical system for monitoring the procurement of medications for public needs. Just recently, several days ago, we discussed this during a meeting with the Government, where Ms Skvortsova talked about the launch of this system.

This system is aimed at ensuring the transparency of public procurement, but its main goal is to prevent overcharging. The introduction of this system will allow us to block every attempt at overcharging, which means saving and efficiently spending budgetary funds, allocating them in a way that better provides beneficiaries with medication, and, most importantly, significantly improving access to these medications and increasing the number of people entitled to these benefits.

At the same time, we must raise the whole medication supply system to an entirely new, higher level. Of course, in this regard, I expect the Government to provide us with specific and clear suggestions and measures.

One more important issue is combating the negative practice of the regional governments’ ignoring the principles of competition and choosing a single medication supplier. As a rule, only local unitary enterprises become such privileged service providers. We could let it pass if they were doing a good job, but, as a rule, they do not. These enterprises focus primarily on their own benefit and, unfortunately, very often abuse their market monopoly by simply overcharging for their services. And there are no other suppliers, as they are the only ones that had been chosen.

This leads to overcharging and, consequently, a decrease in the amount of available medications and the number of people who can obtain them, eventually leading to inefficient budgetary spending – and the people are the ones to suffer from it. We have already adopted decisions on these issues. I would like to hear what has been done – and not just in words, but how it is in fact, in reality.

I identified only a number of areas that require further discussion. Our meeting agenda includes other topics as well, such as supplying medications to those suffering from rare diseases, the so-called orphan diseases. Starting next year, the federal budget will cover the cost of medications for those suffering from five such diseases. Every year, we will allocate up to 10 billion rubles for this purpose. But there are hurdles here, too, and a lot of them.

Remember that by 2024, all regions must have the electronic prescription system in operation.

We will analyse what has been done in this regard as well.

Let us get to work.


November 16, 2018, St Petersburg