Population & Type of Government
With 100 million citizens, the semi-presidential Arab Republic of Egypt is the most populous country in the Arab world and the third most populous in Africa, according to the 2017 census ; with 10% of Egyptians living abroad. The country’s estimated 2017 population growth rate is 2.45%. Most Egyptians are 20 to 39 years old; 40% are under age 24. Egypt’s 1-million square kilometer area is divided into 27 governorates, with 90% of the population living along the Nile River.
Egypt has one of the largest healthcare markets in the Middle East and North Africa (MENA). Healthcare services are provided through the public and private sector. The government is considered the main provider of healthcare services in terms of expenditures, capacity, and the breadth of services.
Government Body Responsible for Healthcare
Formally, the Egyptian Ministry of Health and Population (MOHP) is responsible for ensuring healthcare services for all Egyptians. However, the healthcare system is fragmented with many public and private entities providing healthcare services without MOHP oversight or sovereignty. These issues are addressed in the universal health coverage law passed by Parliament in December 2017.
New Universal Healthcare Coverage
According to MOHP, universal healthcare coverage, one of Egypt’s sustainable development goals for 2030, will be implemented in stages with the first phase starting in late 2018 and covering the population of five governorates (Port Said, Suez, Ismailia, North Sinai, and South Sinai). Coverage will gradually expand to include the entire population by 2032. Currently, approximately 43% of the population does not have health insurance. Out-of-pocket health expenditure is at 60% of the total health expenditure. [2-3]
Subscription to the universal policy will be mandatory. This will spread the financial risk of illness across the entire population and will use funds from the government health budget, other ministries’ budgets, health insurance premiums, co-pays, and additional funds from other resources, such as international donations and nongovernmental organization (NGO) contributions. Premiums will be set at 4% of a citizen’s salary, with 3% paid by the employer and 1% paid by the employee. Employees will pay an additional 1% for each child and 3% for their spouse. Co-pays and deductibles will vary depending on income. Free coverage will be provided for those individuals with incomes below the minimum wage threshold, an estimated 30% of the population. Additional sources of funding include taxes on polluting industries, eg, cement producers and on tobacco users. 
Under the new Universal Health Care Coverage Law, payers and providers of healthcare services will be separated to reduce conflict of interest and potential corruption as well as improve accountability. Three separate entities will be instituted.
In the 2016/2017 fiscal year budget, Egypt allocated 53.3 billion Egyptian pounds (EGP) to healthcare spending, which represents 5.7% of total government spending, or 1.6% of GDP, far below the recommended 3% of GDP as per the Constitution . The World Health Organization’s (WHO) data on current health expenditure (CHE) as percentage of gross domestic product (GDP) indicated that CHE was 4.2% of GDP in 2015. 
For more details on healthcare expenditures, see the World Health Organization’s Global Health Observatory data repository.
Healthcare System Funding
While 5 of 28 governorates will operate under the universal healthcare system, the remaining 22 will continue to operate under Egypt’s current healthcare system. The financing sources include:
The current healthcare system is fragmented, with services provided by different entities that can be categorized mainly into:
Public and Governmental Sector
Public health services are offered free of charge at the MOHP’s large network of hospitals and primary care facilities. Egypt has around 5,000 primary healthcare units and more than 400 general and specialized MOHP hospitals. The MOHP is considered one of the main providers of public healthcare, along with the Health Insurance Organization (HIO) and the Curative Care Organization (CCO), which are quasi-governmental organizations.
The HIO, which covers government employees and school-age children, was created decades ago as the umbrella organization to provide all Egyptians with insurance and care. However, it was never implemented. Under the new universal health coverage, the plan is to re-institute the role of the HIO as the provider of insurance and care for all Egyptians. The increased premiums and co-payments for universal coverage take into account the employee’s salary range and the rise in healthcare services and prices. The CCO operates in specific governorates and contracts with other entities to provide care.
Other public sector and governmental entities— such as university hospitals and clinics, ministry-affiliated hospitals and clinics (e.g., military and railway hospitals), and institution-affiliated hospitals (Egypt Air hospitals and clinics)—provide healthcare services for their members and the population at large for a reduced fee. The Teaching Hospitals and Institutes Organization (THIO) provides primary, secondary, and tertiary services . Both of these entities have self-governance but abide by the MOHP regulations.
The private sector includes several private insurance organizations as well as a network of outpatient clinics and hospitals. There are also health facilities run by religious entities and NGOs as a charity service. The private sector has its own set of regulations and standards. Some are the same as those for the public sector and some may differ. Private insurers and providers negotiate prices with drug manufacturers, but are not involved in the drug evaluation process.
DECISION MAKERS AND INFLUENCERS
Egyptian Cabinet of Ministers
Ministry of Health & Population (MOHP)
Egyptian Drug Authority (EDA)
National Organization for Drug Control and Research (NODCAR)
National Organization for Research & Control of Biologicals (NORCB)
Central Administration for Pharmaceutical Affairs (CAPA)
The Procurement Department
Efficacy, safety, and drug costs are taken into account for coverage by reviewing each application to ensure that medications have acceptable pharmacokinetics, pharmacodynamics, safety (no alerts), and efficacy. The tender drug list is renewed every 2 years, when all drugs go through the review committee again. All applicants have to follow this mandatory review.
The Pricing Unit
Pharmacoeconomic Unit (PEU)
PEU’s four main missions:
Health Insurance Organization (HIO)
The last major expansion of health insurance in Egypt was the introduction of the School Health Insurance Program in the mid-1990s. The HIO continues to have gaps between revenues and expenditures for several reasons:
Beneficiaries in low-income regions bear a larger cost burden than those in high-income regions. The cost to buy insurance is higher for females, those living in rural areas, and those in the lowest income quintile. The lowest income population is less likely to use HIO facilities because they are less likely to be insured.
Medical Supply Department
DECISION-MAKING PROCESS SCHEME FOR HEALTH TECHNOLOGY APPROVAL & REIMBURSEMENT
The Procurement Committee in the MOHP, as well as in other ministry-affiliated health facilities (eg, military hospitals and facilities operated by the ministries of the interior and electricity for their employees and their families) are the initial reimbursement decision makers. Not all market-authorized drugs are reimbursed by MOHP or listed in the tender drug list. The tender drug list is a list of approved medications for reimbursement based on requests by all MOHP hospitals and primary care units. It includes all essential drugs and biologics that need to be covered for patients.
There are three tender drug lists:
The Procurement Technical Committee reviews all MOHP hospitals and primary care units’ needs for medications and applications submitted by drug manufacturers and then decides, based on pharmacokinetics, pharmacodynamics, safety, and efficacy, whether a medication will be listed.
The MOHP makes the final decision on reimbursement based on the Procurement Technical Committee recommendation for the public sector. Other ministries are parallel final reimbursement decision makers for the healthcare services they provide.
PRICING AND REIMBURSEMENT PROCESS
For the mandated market price, the drug manufacturers recommend prices for new medicines. These prices are reviewed by the pricing committee. The recommended price is approved or reduced according to the lowest price-referenced country for the referenced product. The referenced product is then applied to the branded drug.
The pricing committee’s IRP model is based on a list of 36 countries, and a cost-plus model that examines the cost of raw materials, industrial expenses, distribution expenses, as well as company and pharmacy profits. The set price is reviewed every 5 years or upon request by the drug manufacturers. In addition, prices are re-evaluated in the case of a new indication or if foreign exchange rates change by 15%.
A pharmacoeconomic study, based on data from several studies conducted by the CAPA’s PEU, is conducted upon request for high-technology products, such as biologics and chemotherapy drugs. The pharmaceutical company can choose to do its own study; the MOHP can use that study or do its own. The study’s recommendations are considered advisory, not mandatory.
In the case of generic products, the rule is to set the price lower than the referenced product by the following percentages:
This price includes a profit margin for importers, wholesalers, and pharmacists.
The price of the product can be reduced when a lower price for the same product is set in another country.
The reimbursement process in the MOHP applies to MOHP facilities, as well as HIO. Other institution or ministry-affiliated public facilities follow MOHP regulation, but have their own budget and autonomy. As for private sector entities, while they have to abide by the MOHP’s healthcare standards and regulatory rules, they do not have to follow the same reimbursement regulations as the MOHP. They may follow their own set of regulations and negotiation processes for reimbursement.
The Procurement Department is responsible for setting the tender drug list and reimbursement price, which is published and distributed to all MOHP facilities. Each hospital or primary care facility with a plausible budget can purchase their directly from drug manufacturers or wholesalers according to the price specified in the tender drug list (no negotiations).
Each year, the Procurement Department requests that all MOHP hospitals and primary care units submit the needed list of medications and the quantities consumed per year to build the tender drug list. The department then calculates the average amount of medications needed to be covered and forms a new list. The drug manufacturers or wholesalers are informed of the total amounts of medications needed to be covered in the new list, to which the drug manufacturers or wholesalers submit bids.
However, many pharmaceutical companies do not submit bids for the first tender drug list to secure a higher price for a drug and to protect themselves against manufacturing issues that may arise.
After drug manufacturers and wholesalers submit an application, the Procurement Technical Committee meets and decides, based on safety, efficacy, and medical need, whether the medication should be listed. The application then goes to the MOHP Committee for Financial Offers reviews the financial issues to ensure the offered price by is lower than the mandatory market price and doesn't exceed an estimated value (estimated value not regulated by any law) calculated by the Procurement Department for each medication.
The lowest price for each medication is selected for reimbursement. Reimbursement prices are based on acceptable technical offers and the lowest price provided by the drug manufacturers or wholesalers. After the price is set, it is valid on the tender drug list for 2 years. This reimbursement process includes all drugs whether locally manufactured or imported and utilized by the MOHP and HIO facilities.
The procurement committee selects drug manufacturers and wholesalers that have presented the lowest price for the medication with the same active pharmaceutical ingredient (API) to receive reimbursement. Reimbursement is split equally between those manufacturers and wholesalers.
To be listed on the tender drug list, the drug must be effective and safe. The implementation of cost-effectiveness is not mandatory. The time frame to get reimbursed depends on the Procurement Technical Committee’s meeting schedule. Normally, it takes 8 months from the reimbursement dossier application to the official reimbursement status. After a final decision on reimbursement is made, random batches from each product must be tested at NODCAR or NORCB to ensure quality.
In cases of a projected negative reimbursement decision, the Procurement Technical Committee informs the applicant about the negative decision. The applicant may then apply for re-evaluation before the official reimbursement decision has been issued by the committee. Examples of arguments for re-evaluation include price adjustments at the final stage or additional data.
Data Requirements for Pricing for All Egyptian Facilities
Data Requirements for Reimbursement of MOHP and HIO: Three Tender Drug Lists
MOHP: Ministry of Health & Populationوزارة الصحة والسكان
PEU: Pharmacoeconomic unit وحدة أقتصاديات الدواء
Mahmoud Diaa Elmahdawy, PharmD, Patient Access Director, Novartis, Cairo, Egypt
AUTHORS & CONTRIBUTORS
Gihan Hamdy El-sisi, PhD, MSc, Managing Director, HTA Office, Middle East and North Africa, and Treasurer, ISPOR Egypt Regional Chapter, Cairo, Egypt
Randa Eldessouki MD, MSc, MBBCH, Assistant Professor, Faculty of Medicine, Public Health & Community Medicine, Fayoum University, Cairo, Egypt