FOURTEENTH CONGRESS OF THE REPUBLIC ) 
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OF THE PHILIPPINES 
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First Regular Session 
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Introduced by Senator Miriam Dei-ensor Santiago 
EXPLANATORY NOTE 
The Constitution in Article 2, Section 5 provides that: 
Section 5. The maintenance of peace and order, the protection of 
life, liberty, and property, and promotion of the general welfare are 
essential for the enjoyment by all the people of the blessings of 
democracy. 
Article 2, Section 5, on the other hand, provides that: 
Section 15. The State shall protect and promote the right to health 
of the people and instill health consciousness among them. 
The cost of medicines in the Philippines is among the highest in the world. A 
study shows that it would take a full six days of wages for an average worker to purchase 
basic medicines in the country. There are more than 17,000 registered drugs in the local 
market, but a majority of the population can barely afford these expensive essential 
drugs.' 
According to the same news article, Lawmakers are bewildered why Norvasc, a 
medicine for hypertension, is sold in the Philippines by a multinational pharmaceutical 
company for 41.41 pesos (US$l) per 5-mg tablet; while in India and Pakistan, the same 
drug manufactured by the same company is priced at around 5.77 pesos (US.14). 
Plendil, also for hypertension, is priced in the Philippines at 21.82 pesos (US$.54) per 
tablet while it costs only 2.69 pesos (US$.07) in India. A Ventolin inhaler for asthma 
patients is sold for 3 15.00 pesos (nearly US$8) in the local market while in India it costs 
only 126.78 pesos (US$3). Other medicines also show the same disparity. Ponstan, a 
common painkiller, costs only 3.22 pesos (US$.OS) in India but costs 24.92 pesos 
(US$.60) per pill in the Philippines. Bactrim 400, priced at 17.75 pesos (US$.40) per 
' http:llwww.yehey.codnewslarticle.aspx?id=195725 


tablet in the Philippines, can be bought for only 1 peso (US$.02) in Pakistan and 0.69 
centavos in India (less than US$.OI). 
In a US. study, two significant factors contributing to the increase in drug 
costs are the large annual profits of drug companies and the costs in promotional 
spending by pharmaceutical manufacturers. Drug companies, however, argue that prices 
are high due to the high cost of research and development (r&d). However, according to 
the Kaiser Family Foundation, since 
1996 
promotional 
spending 
by 
drug 
manufacturers in the US has increased by 60 percent. Promotional spending by drug 
manufacturers includes paying for television commercials, giving free drug samples to 
physicians, and taking physicians and their staffs on expensive trips. 
The situation in the Philippines is no different. Drugs manufacturers spend 
millions of pesos in marketing expenses. In order to create policy decisions as regards 
the problem of high medicine costs, lawmakers should be informed of the current level of 
marketing costs in relation to total production cost of drug manufacturers. This bill aims 
to require drug manufacturers to submit annual reports of their marketing expenses to the 
Secretary of Health in order to fill in the information gap in the minds of our lawmakers. 


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FOURTEENTH CONGRESS OF THE REPUBLIC ) 
OF THE PHILIPPINES 
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C’ 
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i., 
First Regular Session 
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Introduced by Senator Miriam Defensor Santiago 
AN ACT 
TO REQUIRE MANUFACTURERS OR LABELERS OF PRESCRIPTION DRUGS TO 
REPORT THELR ANNUAL MARKETING COSTS 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Corigress assembled: 
SECTION 1. Short Title. - This Act shall be known as “Annual Marketing 
Expenses Report for Drug Manufacturers Act of 2008.” 
SECTION 2. Declaration of Principles. - The maintenance of peace and order, 
the protection of life, liberty, and property, and promotion of the general welfare are 
essential for the enjoyment by all the people of the blessings of democracy. In order to 
protect the general welfare of the population as regards access to cheap medicines, it is 
the policy of the state to inquire into the reasonability of marketing expenses of drug 
firms. 
SECTION 3. Dejnition of Terms. - As used in this Act, unless the context clearly 
indicates otherwise, the following terms shall have the following meanings: 
(a) “Labeler” means any person or entity that receives a prescription drug from 
the manufacturer or a wholesaler of such drug, and repackages such drug to be dispensed 
in this country. 
(b) “Manufacturer” means a manufacturer of prescription drugs dispensed in this 
country, and shall include the subsidiary or affiliate of such manufacturer. 
(c) “Marketing” means advertising and promotional activities for prescription 
drugs dispensed in this country including, but not limited to, those activities described in 
this Act. 
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SECTION 4. Reportorial Requirement. - The Secretary of Health is authorized 
and directed to require manufacturers or labelers of prescription drugs, which dispense 
such drugs in this country and which employ, direct or utilize marketing representatives, 
to report the marketing costs of each of its prescription drugs dispensed in this country. 
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SECTION 5. Manner of Reporting. - On or before February 1 of each year every 
manufacturer and labeler shall file a report with the Department of Health on its 
marketing activities conducted in the country. Such report shall be submitted in such 
form and manner, and include the payment of such a fee as shall be determined by the 
Secretary of Health. Each such report shall include the value, nature, purpose and 
recipient of marketing expenses including, but not limited to: 
(a) all expenses associated with advertising, marketing and direct promotion of 
prescription drugs through radio, television, magazines, newspapers, direct mail and 
telephone communications as they pertain to residents of e country; 
(b) all expenses associated with educational 
or 
informational programs, 
materials and seminars, and remuneration for promoting or participating in educational 
or informational sessions, regardless of whether the manufacturer or labeler provides 
the educational or informational sessions or materials, 
(c) all expenses associated with food, entertainment and gifts valued at more that 
One Thousand Pesos (Php 1,000.00) and anything provided 
to 
a 
health care 
professional for less than market value, 
(d) all expenses associated with trips and travel for marketing purposes, 
(e) all expenses associated with product samples, except for samples that will be 
distributed free of charge to patients; and 
(9 the aggregate cost of all employees and contractors of the manufacturer or 
labeler who directly or indirectly engage in the advertising or promotional activities, 
including all forms of payment to such employees and contractors. 
The cost reporled pursuant to this Act shall reflect only that portion of payment to 
employees and contractors that pertains to activities within the country or to recipients of 


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country. 
The cost reported pursuant to this Act shall reflect only that portion of payment to 
employees and contractors that pertains to activities within the country or to recipients of 
the advertising or promotional activities who are residents of or are employed in this 
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SECTION 6. Exceptions. - The following marketing expenses shall not be subject 
to the reporting requirements of this subdivision: 
(a) expenses of One Thousand Pesos or less; 
(b) 
Reasonable compensation and reimbursement for expenses in connection 
with a bona fide clinical trial of a new vaccine, therapy or treatment; and 
(c) scholarships and reimbursement of expenses for attending a significant 
educational, scientific or policy-making conference or seminar of a national, regional or 
specialty medical or other professional association if the recipient of the scholarship is 
chosen by the association sponsoring the conference or seminar. 
SECTION 7. Department Reports. - Annually on or before November 30, the 
Department of Health shall submit a report, providing information in aggregate €om, on 
prescription drug marketing expenses to both Houses of Congress. One year after the 
passage of this Act and every two years thereafter, the Department of Health shall 
provide a report to both Houses of Congress, providing information in aggregate form, 
containing an analysis ofthe data submitted to the Department ofaealth, including the 
scope of prescription drug marketing activities and expenses and their effect on the 
cost, utilization and delivery of health care services and any recommendations with 
regard to marketing activities of prescription drug manufacturers and labelers. 
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SECTION 8. Violations. - Any person who violates any provision of this Act 
shall be punished with a penalty of Five Hundred Thousand Pesos (Php 500,000.00). 
Subsequent violations shall be cause for the revocation of the manufacturer’s or labeler’s 
permit to do business in the country. 
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SECTION 9. Implementing Rules and Regulations. - Six (6) months after the 
passage of this Act, the Secretary of Health shall promulgate the rules and regulations 
necessary to implement the provisions of this Act. 
SECTION 10. Separability Clause. - If any provision or part of this Act is held 
invalid, the remainder of this Act shall not be affected thereby. 
SECTION 11. Repealing Clause. - All laws, decrees, executive order or rules 
and regulations inconsistent with this Act are hereby repealed or modified accordingly. 
SECTION 12. Effectivity Clause. - This Act shall take effect fifteen (15) days 
after its publication in the Official Gazette or two (2) newspapers of general circulation. 
Approved, 
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