In a recent working paper, published in November, Oxfam Perú and Acción Internacional para la Salud link together Peru’s highly inequitable tax system and the incidence of cancer among women.
Each year some 45,000 cases of cancer are detected in Peru, of which women are the most affected. Some 1,200 women die each year of breast cancer alone. The incidence of cancer is, of course, most catastrophic among poor people who simply cannot afford the high costs of treatment.
In the absence of an effective health system that could protect women sufferers, pharmaceutical companies benefit from huge tax exonerations (introduced in 2001) that amount, according to the study’s authors, to twice the Health Ministry’s total budget for 2018. This budget figure would be four times higher if there was no tax avoidance.
Tax exemptions (from VAT and import tax) are supposed to lower the cost of cancer drugs for patients, but studies show that such exemptions have had little impact on prices while pharmaceutical companies’ profits have increased substantially. The main companies with a presence in Peru are Johnson & Johnson, Bristol Myers Squibb, Eli Lilley, Roche and Merck. Of these, the largest exemption was enjoyed by Roche whose drug Trastuzamab is one of the main drugs used in the treatment of metastatic breast cancer.
Not only does Peru have one of the lowest tax takes in Latin America, but expenditure on health (in relation to GDP) is only 5.8% of GDP, compared with a Latin American average of 7.1%.
Diagnosis and treatment of cervical and breast cancer is far better in Lima than elsewhere in Peru, especially in rural parts of the country. But overall, much larger funding is required if treatment is to be made more widely available.