The healthcare system
Since 2000, healthcare reform in Chile has been on of the major political issues in order to reduce the inequality in healthcare access that currently exists (1). The government is attempting to guarantee the population a minimum level of care for 56 priority illnesses. By 2002, healthcare funding was increased by 10% and it formed one of the largest components of government spending. The emphasis on healthcare has led to building and modernization of 83 hospitals, the creation of 13 new specialized centres, 126 clinics, 117 dispensaries, and 50 primary emergency units. There are currently 186 public hospitals and 40 private hospitals in Chile (1).
Around 70% of the population use the public healthcare system with the remainder using private services. All employees must contribute to either healthcare system via their salary. The Ministry of Health is responsible for the overall running of the healthcare system, but 29 regional health services control healthcare at a more local level. The government’s current plans are to invest US$40 million in healthcare with around half of this devoted to medical equipment.
The pharmaceutical market
Chile’s pharmaceutical market is one of the smaller Latin American markets, but it has shown promise and has attracted inward investment from most of the multinationals (1). It currently represents around 3% of the Latin American market (1). Public sector spending on pharmaceuticals is estimated at US$137 million per year.
The Chilean pharmaceutical sector is heavily influenced by the activities of the large multinationals (1). There are around 30 foreign companies in Chile and it has been estimated that in 2005 they spent US$45 million on R&D activities (1). The companies are represented by the Cámara de la Industria Farmacéutica de Chile (CIF). Not surprisingly, branded pharmaceuticals are well-represented on the market. Despite the domination by brand name pharmaceuticals, generics now represent 25% of the market (1). The most popular therapeutic categories are CNS, respiratory and gastrointestinal. One of the growth areas for the market has been for over-the-counter (OTC) products. This is because they are increasingly being made available to the public through pharmacies (1).
The Bolivian pharmaceutical industry has complained that it is suffering because of products from Chile appearing on its market (1). As there are no tariffs for products being imported into Bolivia from Chile, the national market has seen a steady rise in Chilean products at the expense of the local industry (1). According to representatives of the Bolivian industry, more than 50 Chilean companies commercialized over 1000 products on the Bolivian market during 2003 (1). The market for these Chilean-derived products was valued at US$8.5 million. One of the problems for the Bolivian industry is that it does not export products to Chile and is unable to compete with the companies based there. The Bolivian industry has called on the government to provide greater support for the national industry and rectify the imbalance that it perceives in the market (1).
In Chile, pharmaceutical products can be classified into three types: brand name products, generics and similares (1). Branded products are the most expensive because they are patented and are mainly developed outside the country. Generic products, originating from Chilean companies are roughly ten times cheaper and similares products have an intermediate price. According to an economic study, pharmaceutical prices in Chile have increased because of new government policies, with the price of generics rising by almost 25% (1). There has been a greater demand for generics as drugs are prescribed according to their generic name rather than brand name. The economists behind the study have predicted further rises in the price of generics, because of the need to carry out bioequivalencey studies, which will necessitate further investment by companies (1).
At present Chile is considered a minor Latin American market, with most companies tending to direct their sales efforts towards Mexico, Brazil, Argentina and to some extent Venezuela. However, Chile does appear to be of particular interest for R&D purposes, especially for clinical research. In 2003 the Instituto de Salud Pública (Institute of Public Health) registered 45 approved clinical trials and valued this type of research at between US$10 million to US$15 million per year. A 2002 survey found that 800 investigators in Chile were involved in clinical research and that the therapeutic areas of greatest interest were cardiovascular, diabetes, central nervous system, cancer, osteoporosis and vaccine studies (2).
Apart from industry activity, the government is also keen to promote innovative research. For example, Chile has been attempting to develop a biotechnology sector but this has been made difficult through a lack of central coordination. An additional problem is that many observers consider Chile’s patent legislation for the biotechnology industry to be inadequate by international standards (1). The current areas of interest for this sector include substances for diagnostic kits and vaccines.
- Kermani F (2005). Healthcare and Pharmaceuticals in Latin America: A guide to the markets and regulations. Urch Publishing. ISBN 0954698177.
- Urbina S (2004). Ensayos Internacionales de nuevos fármacos aumentan 50% en el país. La Tercera, 26th July 2004. Boletines Fármacos.
Dr Faiz Kermani has several years experience in both academia and the pharmaceutical industry. He has worked in pharmaceutical R&D, pricing and reimbursement, marketing and medical communications. He holds a PhD in Immunopharmacology from St. Thomas’ Hospital, London and a First Class Honours degree in Pharmacology with Toxicology from King’s College, London. He has written extensively on international healthcare issues, and is on the editorial board of a number of publications. In March 2006, he was a delegate on the UK Government’s Trade and Investment Biotech Scoping Mission to China and was a speaker at the subsequent presentation.
You can contact Dr Kermani via firstname.lastname@example.org