24 September 2014 – Australia’s system of scheduling medicines means that Australian consumers cannot access several non-prescription medicines over-the-counter (OTC) that are available without a prescription in many other countries, says consumer behaviour expert Professor Scott Koslow.

Professor Koslow will present the results of new research on consumers’ current and future potential behaviour in relation to accessing medicines, at the Australian Self Medication Industry (ASMI) Conference on 18 November 2014.

“Consumers are very familiar with OTC medicines. Approximately 80 per cent of adults and 40 per cent of children use an OTC medicine in any given month,” said Professor Koslow.1 “They are comfortable using OTC products and they want greater access to them to achieve better healthcare outcomes.”

OTC products include analgesics and pain relievers, cold and flu medications, treatments for allergy and sinus problems, muscle and pain rubs, quit smoking aids, first aid and antiseptics, and medicated skin products, amongst others.

Professor Koslow, from the Macquarie University Centre for the Health Economy, surveyed, in two parts, the attitudes of 1,146 Australians over the age of 18 regarding their use of OTC and prescription medicines.

The first part of the study focused on the current contribution of OTC products to the health economy. It revealed that between 52 to 70 per cent of respondents would visit a doctor to obtain required medication if faced with the unavailability of an OTC product.

“Visits to the doctor cost individuals and Australia’s healthcare system a lot of money – this hypothetical scenario would cost an incremental $3.8 billion in doctor’s visits,” explained Professor Koslow. “Of that amount Medicare would have to pay an additional $2.5 billion for 58 million doctor’s visits and consumers’ out-of-pocket costs would be approximately $1 billion. Added to that are the productivity losses of time spent travelling and waiting at the doctor’s surgery.”

“So the key message here is the vast majority of consumers are very comfortable with OTC’s and this behaviour is saving the health economy quite a bit,” said Professor Koslow.

The second stage of the study examined the possible economic and budgetary impact if 11 categories of common prescription only medicines were made non-prescription and down- scheduled to Pharmacist Only medicines. That is, the impacts if more medicines were made available to the consumer as OTC’s.

It found that the potential future benefit to the community as a result of this ‘down-scheduling’, or ‘switching’, was equivalent to a further $2.1 billion a year.

Of this amount, a total of $1.1 billion would be saved through some 17 million avoided GP visits, while $1 billion derives from productivity savings.

Dr Deon Schoombie, ASMI Executive Director, said there was potential for considerable savings to governments and the community by ‘harmonising’ product schedules with other ‘like’ markets.

“Most of these medicines have a long history of use and many have already been switched to non- prescription status in countries such as the UK, USA, New Zealand, Sweden, Germany and Canada.

Professor Koslow concluded that Australian consumers are missing out on potential healthcare benefits and cost savings because of their limited access to OTC medicines compared with consumers around the world. “There is strong empirical evidence that demonstrates consumers are ready to purchase a greater range of OTC products but Australia’s regulatory system means potentially poorer healthcare outcomes and higher out-of-pocket costs,” said Professor Koslow.

Professor Scott Koslow

Professor of Marketing, Macquarie University

Professor Scott Koslow researches advertising creativity and strategy, and also consumer behaviour and marketing research methods. His research has appeared in premier marketing journals like the Journal of the Academy of Marketing Science (JAMS), Journal of Advertising (JA), Journal of Advertising Research (JAR) and the Journal of Consumer Research (JCR).

Scott received his PhD from the University of Southern California and he has taught at the University of Texas, the University of Michigan and most recently at the University of Waikato. He has also been an academic visitor at Imperial College London, New York University, Baruch College of the City University of New York, and Wayne State University in Detroit, Michigan.

References

Koslow, S. The value of OTC medicines in Australia. Macquarie University Centre for the Health Economy, 2014.