Role of the Private Sector

Private manufacturers, importers, sales agents, wholesalers and pharmacists are a key element of the real world pharmaceutical market in most countries. In many cases they dominate the market from a quantitative perspective. However, drug policy frequently focuses on the public sector only, thereby leaving the private sector and its customers in a regulatory vacuum.

Regulation of the private sector should follow two leading principles:

1. Provide a framework that allows the private sector to grow and be profitable
2. Set and implement rules for the private sector that ensure quality of care, safety and a contribution to public health goals

These two principles lead to certain considerations that inform legislation and regulation of the private sector:

• Existing and desired structure (industrialized and integrated or de-centralized and fragmented)
• Information requirements (for statistical and policy purposes)
• Human resource requirements, governance and personal accountability
• Technical requirements e.g. storage conditions and participation in quality circles
• Contracting rules with public providers and insurers
• Self-regulation bodies such as associations
• Tax incentives for desired behavior