R.M.B. Senanayake concludes his spirited response to my critique of his economic approach to the drugs debate by saying: "I am a patient myself and I would prefer to go by the opinion of my doctor, but Prof. Carlo does not have to do so. He is more fortunate" (The Island, 19 April). I owe my good fortune in this matter to the taxpayers of this country who gave me my undergraduate, postgraduate and postdoctoral education free, gratis and for nothing. Consciousness of my indebtedness to the people of this country oppresses me every now and then and all I can do to repay it inadequately is to share with them the information I have acquired at their expense. This information has enabled me to derive maximum benefit from modern medicinal drugs with minimal physical and economic damage.

Heaven knows RMBS is right when he says that as a patient he has to trust his doctor. So must all of us, even when the patient happens to be a doctor. During the past few years I have sought the advice of two specialist doctors. By my good fortune both happen to be very lovable and kind former pupils of mine. One is a professor of medicine, Janaka de Silva, the brilliant academic physician. The other is the eye surgeon Dr. Imalka Fonseka, a skilled glaucoma expert.

Prof. Janaka's advice to me was to take every morning half of a 50mg tablet of a State Pharmaceutical Corporation product called Hydrochlorothiazide (HCT). The 15 tablets of HCT I require for a month cost so little that my pharmacist cannot be bothered to bill me for them. So I get them for free. Even as he gave me the advice, Prof. Janaka remarked that he prescribed such a cheap drug for me because he knows that I am not the sort of rural idiot who lives by the rule "cheap drugs, no good". I took his advice because I was myself aware of the ALLHAT Trial (short for Antihypertensive and Lipid-Lowering Treatment to Prevent Heart Attack Trial). In this trial conducted by the National Institutes of Health of the USA, over 42,000 people at more than 600 clinics participated. It took 8 years to complete. Four types of drugs used in the treatment of hypertension were compared. In the following table I will set out the relevant information in a way that will serve my present purpose. (The prices are those which prevailed at the SPC in February 2008)

The results of the ALLHAT Trial published in The Journal of the American Medical Association showed that HCT was just as good as the others for lowering blood pressure and better than the others for preventing heart disease and stroke. The conclusion was: "ALLHAT shows that diuretics are the best choice to treat hypertension both medically and economically." So Prof. Janaka's advice to me was spot on. Literally it was just what the doctor ordered.

Dr. Imalka Fonseka who has skillfully prevented me from going blind is obliged to prescribe for me a very expensive proprietary (branded) drug because its patent period has not elapsed. So it is still not available as a generic medicine. But as a thoughtful service to patients she (and other eye surgeons) used to send patients directly to the importers of the drug who gave them a discount of Rs. 250 per vial. To facilitate matters and to prevent commercial abuse the doctors referred the patients to the company on a specially printed form. Sad to say, ill-informed and unfair criticism of this practice by some careless newspaper reporter has so piqued the eye surgeons that they no longer go to the trouble of directing patients to the importer. I appeal to the eye surgeons to resume their kind extra service to their glaucoma patients because for many pensioners a saving of Rs. 250 per month for the rest of their lives would be a great boon. As an old teacher let me tell them that we must not stop doing the good things we do just because ignorant people say malicious things about us.

In his reply to me RMBS has made several points and invited comments. From the standpoint of his economic approach to drugs he says:

1. The asymmetric information gap between doctor and patient leads to imperfect markets in healthcare, but state failure in Sri Lanka is worse than market failure.

2. The ethical behaviour of doctors is outside the purview of economics, but the patient has to trust his doctor to do him nothing but good.

3. Drug companies are known to promote drugs unethically and the state must intervene to regulate it.

As an economist RMBS's strategy for coping with the above realities is based on two principles.

I. The principle of congruence. Both patient and doctor want a cure, the patient for his own good and the doctor for the good of his reputation. RMBS believes that this congruence will ensure optimal service to the patient.

II. "Better doctors have more patients" principle. Therefore, to get the best deal patients should consult the doctor with the most number of patients because he has a reputation to maintain.

These principles sound reasonable enough but let me try to show why they are unlikely to work well in the field of healthcare in Sri Lanka. The assumption underlying the principle of congruence is that because both patient and doctor want a cure the doctor will do his best to cure the patient optimally. Let us suppose that the patient has high blood pressure and that any of the drugs included in the table above will control it. If the doctor is a prescriber of generics, he can satisfy the principle of congruence at a unit cost of 20 cents; 70 cents; Rs. 1; or Rs. 1.10. On the other hand if the doctor swears only by proprietary drugs he can satisfy the principle at a unit cost of Rs. 7.56; Rs. 12.75 or Rs. 17.40. To illustrate my point let us consider the extreme cases: The principle of congruence can be satisfied at a unit cost of 20 cents or Rs. 17.40. In the latter case the patient pays Rs. 17.20 more! If an unethical doctor works hand in glove with an unethical drug merchant they can satisfy the principle of congruence and coolly fleece the patient.

As to RMBS's second principle, in Sri Lanka the doctors who get the most number of patients in different specialties are not necessarily the most competent, but the ones in charge of the wards in state hospitals. Patients go to them not because they believe that those doctors have a reputation to maintain, but because they know the doctors have the power to allocate hospital beds. Thus RMBS's second principle will not achieve the desired aim of optimal cost effective medical attention for patients. Clearly, the economic approach to medicinal drugs is bound to be unsatisfactory. What then is to be done?

Intervention of a well-advised welfare state is the tried and tested solution. RMBS is, however, so prejudiced against state intervention in economic affairs that he will have none of it. The state of Sri Lanka may have messed things up in other fields, but it has a long and widely acclaimed impressive record of direct intervention in the field of social welfare and healthcare. The evidence that RMBS demands for the cost-effectiveness of state intervention in social welfare of which healthcare is an important aspect has been well documented. In the 1970s Sri Lanka with a per capita GNP of USD 179 had a Physical Quality of Life Index (PQLI) of 82. (The PQLI is computed on the basis of life expectancy, infant mortality rate and literacy rate) In 1979 Morris D Morris judged: "Sri Lanka provides the most dramatic example of a country that has been able to achieve remarkable life quality results at startlingly low levels of income". And in 1981 world famous economist Amartya Sen remarked: "For a poor country… Sri Lanka's record in providing a higher quality of life is quite remarkable". How did Sri Lanka achieve those results?

The major benefits of modern drugs are both on the quality of life and the quantity of life (life expectancy). Even at present 95% of indoor patients and 50% of outdoor patients in our country are cared for in state institutions and treated with generic medicines imported and distributed by the state. This policy has prevailed over the last four or five decades. It has prevented the country from squandering our meagre resources on importing exorbitantly priced proprietary drugs. In the delivery of healthcare the state sector has practiced orthodox, textbook medicine. For example, Clinical Medicine by Kumar&Clark (6th edition 2005) states that "generic drugs are required to go through the same stringent regulatory processors as their branded counterparts" ,and it recommends that "to reduce costs all drugs should be prescribed by their generic (approved) names". (page 996). That was precisely what Prof. Senaka Bibile advocated from 1959. Therefore, I submit that the way forward for Sri Lanka in the healthcare field is to go back to the Bibile drugs policy.