Let’s look at one indicator of fair value of deworming meds on the international market – list prices and actual transactions.
Why? As I understand, the biggest med in financial statements of U.S. relief and development NPOs is mebendazole. The usual dosage is 500 mg. I also understand that particular dosage is not approved for distribution in the United States. Since you can’t use or distribute that dosage of that medicine in the U.S., seems like we should look at international pricing instead. In addition, after FAS 157 went into effect, the principal market should be considered.
One source for international pricing is the International Drug Price Indicator Guide.
Here’s a description of the guide on the homepage:
The International Drug Price Indicator Guide contains a spectrum of prices from pharmaceutical suppliers, international development organizations, and government agencies. The Guide aims to make price information more widely available in order to improve procurement of medicines of assured quality for the lowest possible price. Comparative price information is important for getting the best price, and this is an essential reference for anyone involved in the procurement of pharmaceuticals.
Management Sciences for Health (MSH) has published the International Drug Price Indicator Guide since 1986 and updates it annually.
What data does this Guide have? Indicators of pricing for a huge number of medicines. For each medicine there is information listed for suppliers and buyers. Those categories are defined here:
Suppliers who maintain a warehouse and supply items directly to customers. All these suppliers provide a wider range of products than shown in this Guide. For a complete list of products, contact the vendor directly.
Buyer, usually government agency international competitive bidding, or tender, prices from public sector sources. These are actual prices obtained by the organizations listed and are included for information purposes. It is not possible for a reader to place an order with any of these organizations. These prices should not be used as international reference prices since they may only be available to the organization conducting the tender or procurement. This is especially true in domestic tenders, because local manufacturers may not sell internationally.
To me, that means the information listed for suppliers is their list, or offer, price. I think it means you can buy this medicine from that vendor at the listed price for the specified year. Might be able to do better or worse on an actual purchase, but those are the list prices.
The buyer information, I think, means these are actual purchase prices paid by various agencies in actual transactions. While adjustment may be necessary for what an NPO might pay compared to a government agency, these are actual transactions.
Seems to me the information here would be a very good indicator of international drug prices.
In addition to containing list prices and actual transactions, the price is attractive – free.
If I’m confused about what is contained in the International Drug Pricing Indicator Guide or misunderstand the data, please correct me.
If you know of another source for international drug pricing, please let me know.
So here is some pricing information. I’ve provided the links so you can check out my comments.
All of the following data is for one dose of 500 mg mebendazole expressed in US dollars.
Here are the highest and lowest prices in the Guide for suppliers and buyers for 2010.
- $0.0200 – UNFPA – UN Population Fund
- $0.0920 – MEG – Medical Export Group
- $0.0171 – CAMERWA – Centrale d’achat des Médicaments Essentiels, Consommables et Equipements Médicaux du Rwanda
- $0.1827 – SAFRICA – South Africa Department of Health – this is for one tablet packaging
Here are the high and low prices per unit for suppliers and buyers for 2008:
- $0.0119 – UNFPA – UN Population Fund
- $0.0290 – IDA – IDA Foundation
- $0.0213 –Senegal– Pharmacie Nationale d’Approvisionement du Senegal
- $0.1286 – SAFRICA – South Africa Department of Health
To give a longer time horizon, here are the high and low prices for suppliers and buyers of the same med in 2005:
- $0.0115 – UNFPA – UN Population Fund
- $0.0914 – IMRES
- $0.0084 –SENEGAL- Pharmacie Nationale d’Approvisionement du Senegal
- $0.0390 –Nicaragua- Ministerio de Salud de Nicaragua
Looks like the South Africa Department of Health prices are an outlier for some reason.
It helps to see all those highs and lows together, so here is the compressed data. I also listed the second lowest supplier price for each year.
- $0.0200 –$0.0119 –$0.0115 – lowest of list price each year
- $0.0325 – $0.0164 – $0.0140 – second lowest list price for each year
- $0.0920 – $0.0290 –$0.0914 – highest of list price each year
- $0.0171 – $0.0213 –$0.0084 – lowest of actual purchases each year
- $0.1827 – $0.1286 – $0.0390 – highest of actual purchase each year
As an aside, a comment in the FASB Nonprofit Advisory Committee’s meeting on 3-1-12 suggested there is one provider that is distorting the market, I noticed there are five suppliers listed for the three years of data I listed: UN Population Fund, Medical Export Group, Missionpharma, IDA Foundation, and IMRES. I included the second lowest list price above.
To simplify, I calculated an average of the 3 data points above:
- Supplier – average of lows is $0.0145, average of second lowest is
$0.210$0.0210, average of highs is $0.0708
- Buyer – average of lows is $0.0156, average of highs in $0.1168
Making it even more simple, the Guide points to list prices and actual purchase prices per pill of pennies per dose. The outlier on the high side is 5 for $1.00.