Fifteen percent of 900 drug samples from developing countries failed at least one quality test and are priced 13 to 18 percent lower than non-failing drugs. The poor-quality/low-price link is as of yet inconclusive, says Roger Bate of the American Enterprise Institute, in part because of price overlaps between poor-quality drugs and generics relative to brands.
If Bate and the AEI sound familiar, it's because their recent work has highlighted variability in the composition of drugs made in Africa and Asian countries as well as evidence of China's involvement in drug fakes attributed to India.
In this latest report, Bate takes on counterfeiting and substandard production and distribution in a study of the economics of poor-quality drugs. His emphasis is on the prevalence of poor-quality drugs in association with local regulation, income and literacy rate.
The research finds that the difference between failing and non-failing drugs is greater in countries with lower-than-median literacy rates. Another finding: covert shoppers involved in the research were able to draw some conclusions about drug quality and price based on the appearance of pharmacies.