Are Some Medicines Too Cheap?

That’s a question few of us ever expected to be taken seriously. Just the opposite is the norm. But there is a developing problem about low-priced medications -- they are becoming in short supply.

This is certainly a problem in the U.K., where access to a basic AIDS drug has been difficult. But shortages of essential drugs -- mostly generic medicines whose patents have long expired -- are becoming increasingly frequent globally. In fact, the World Health Organization (WHO) has gone as far as to suggest minimum prices may be needed to keep some products on the market.

These drug shortages are due to several factors, from manufacturing, quality and raw material problems to unexpected spikes in demand -- all of which are exacerbated by the fact that there are fewer and fewer suppliers.

This notion of minimum prices for certain essential medicines contrasts sharply to traditional pricing debates about how to reduce the  extremely high cost of new patented drugs for diseases such as cancer and hepatitis C.

Of major concern is that shortages in developing countries may go unreported for months or even years, which increases the risk of counterfeits entering the supply chain.

As in most businesses, the bottom line is the bottom line: If prices become too low, manufacturers of essential drugs are driven out of the market by their economic responsibilities.

Sourced from: Reuters, Drug shortages prompt question: are some medicines too cheap?