Generic medicine policy can save $2.6bn annually

August 2020

The implementation of a generic medicine framework (legislation) in Saudi Arabia can result in an estimated decrease of 35 per cent to 40 per cent, equivalent to SR10 billion ($2.66 billion), in medication spending annually, according to a new report report released by Bupa Arabia for Cooperative Insurance.

The whitepaper is considered to be the first of its kind to explore generic medicine legislations in the Kingdom.

Dr Ayman Al-Sulaimani, Medical Director at Bupa Arabia, said there’s an existing policy in favour of generic medicine in Saudi Arabia. However, it lacks enforcement due to the non-availability of generic medicine at the desired level of quality and price even though healthcare continues to be a top priority for Saudi Arabia.

“Today, only 30 per cent of pharmaceuticals are manufactured locally,” added Dr Al Sulaimani. “Introducing a generic medicine framework can boost local manufacturing of drugs, which not only provides employment for Saudis but also reduces the medication cost burden.”

The World Health Organization (WHO) defines a ‘generic drug’ or ‘generic medicine’ as: a pharmaceutical product usually intended to be interchangeable with the originator brand product, manufactured without a licence from the originator manufacturer and marketed after the expiry of patent or other rights.

A study conducted by the IQVIA Institute for Human Data Science concluded that the global spending on pharmaceuticals reached a staggering $1.2 trillion in 2018 and is expected to exceed $1.5 trillion by 2023. In the Middle East and Africa, the study pointed to an increase in pharmaceutical expenditure by 9 per cent, amounting to $25 billion, of which $8 billion came from Saudi Arabia alone.

Based on Bupa Arabia’s report, Saudi Arabia is the largest spender on healthcare across the Middle East, with over $37 billion (SR139 billion) spent. 

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