Drug prices spiral out of control in hospitals

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Mismanagement of drug prices at local hospitals has placed a huge burden on patients and the national fund for social insurance, officials said Saturday.

Nguyen Duc Thu, an official of the National Assembly's Office, said even though drug supply contracts at hospitals have gone through a bidding process, the prices of some drugs were 150-300 percent higher than their real prices.

The situation is the same even at state-owned hospitals, and this is having negative impacts on patients as well as the country's social insurance fund, Thu said at a conference in the northern province of Vinh Phuc on Saturday.

"All drug commissions go to sales agents, pharmaceutical representatives and doctors, which leads to drug abuse and high prices," he said.

Many experts have expressed suspicions that the bidding process has not been carried out properly, allowing drug suppliers to make "backdoor" entries and win bids, Thu said.

It's unreasonable that drug prices at hospital are even higher than market prices considering they buy in large volumes, said Le Bach Hong, general director of Vietnam Social Insurance, which manages the national social insurance fund.

Hong said his fund has to pay trillions of dong to cover medical treatment fees for policy holders and the biggest expense, 60 percent, was for drugs. This ratio is too high, compared to 45 percent in China, 38 percent in Indonesia and 35 percent in Thailand, he added.

Though important, drugs are only one of the medical products and services required for treatment and their use should not be abused, he said, citing a case in which nine different drugs, some not really necessary, were prescribed for a 70-year-old patient.

"If the expense on drugs can be cut by only 10 percent, the country can save VND1 trillion a year," Hong said. "This money can help provide health insurance for another 2.5 million poor patients."

Ta Van Bang, another Vietnam Social Insurance official, said many different drugs can serve for the same purpose but many hospitals choose to sell the more expensive ones.

Prices of the same drugs also vary between hospitals, with gaps of up to 30 percent, he said.

He said it was necessary to invite bids for drug supplies on a provincial level to ensure prices are the same and reasonable at all hospitals in each city and province.

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