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Access to essential medicines is poor in India. To improve accessibility of essential medicines, the Government of Delhi (India) implemented a drug policy based on the essential medicine concept in 1994. A list of essential medicines was selected and systems for quality assurance and pooled procurement of medicines were established. In this study the impact of the drug policy, on costs and quality of medicines has been assessed. The costs and quality of medicines procured by the Delhi Government's Central Procurement Agency (CPA), for public health facilities were analyzed from 1995 to 2009. The CPA costs were compared with procurement prices of other public sector agencies: Medical Stores Organization (MSO) and Tamil Nadu Medical Stores Corporation (TNMSC), local hospital tender, retail pharmacies (Government and private) and international reference prices. The costs of prescriptions in Public health facilities were monitored and the quality of medicines being procured was assessed. The findings showed that costs of essential medicines have decreased by 33.3% over 15 years. Over three years (2006-2009) the unit costs of medicines and the average expenditure per prescription increased marginally. The local tender prices were 27.2% and medicine costs at Government retail pharmacies 96.5% more than CPA prices. The procurement prices of agencies, with larger volumes of bulk purchase ie. MSO & TNMSC, were lesser than CPA prices by 18.7 % and 44.23% respectively. The private retail prices were variable and 242.7% to 897.12% more and international reference prices higher than CPA prices by 226%. The costs of medicines procured by CPA were lower than all other agencies, except MSO and TNMSC. The medicine samples that failed quality tests decreased from 1.45% to 0.13%. Implementation of an essential medicine policy by the Government of Delhi has enabled quality medicines to be procured at low costs. Such policies may help improve medicine accessibility in India.
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