While the Pharmaceuticals Management Department does not allow drug price increase in the local market, the cost of many kinds of drugs has gone up, causing great concerns among people and hospitals. Deputy Prime Minister Pham Gia Khiem signed a document to implement measures to stabilise drug prices in 2006
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While the Pharmaceuticals Management Department does not allow drug price increase in the local market, the cost of many kinds of drugs has gone up, causing great concerns among people and hospitals. Deputy Prime Minister Pham Gia Khiem signed a document to implement measures to stabilise drug prices in 2006.
Under the document, the Ministry of Health will be assigned to instruct pharmaceutical importers and distributors to consider the costs of production and marketing to ensure proper drug prices. At the same time, MOH should investigate and evaluate drug prices for local medicine production establishments, strengthen control over imported foreign drugs, eradicate monopolies and publicise the price of drugs.
The same day, the Pharmaceuticals Management Department under MOH replied to press agencies about the rise of drug prices and announced some measures to stabilise prices in 2006. Head of the Pharmaceuticals Management Department Cao Minh Quang said four pharmaceutical companies announced adjustments to drug prices of between 3-5 percent for 28 items in early 2006.
Various drug prices increase
While the department does not allow drug price increase in the local market, the cost of many kinds of drugs has gone up causing great concern among people and hospitals.
Regarding the chaotic drug pricing in the market, deputy head of the department Quoc Cuong said “Drug pricing is normal as no goods have a fixed price”. He added that in 2005, drug prices increased by 4.9 percent compared to an overall consumer price index of 8.4 percent. Pharmaceutical enterprise explained that the increase in drug prices can be attributed to the necessity to invest in the Good Manufacturing Practice (GMP) standard production line, causing high production costs.
Mr Cuong said enterprises’ proposal to increase prices is appropriate, as the prices of materials for drug production are soaring. Currently, 58 out of 175 enterprises meet the GMP-ASEAN standard. However, only two of them proposed to raise drug prices in order to invest in the GPM-standard production line endorsed by the World Health Organisation (WHO).
In addition, 2-5 percent of enterprises, mostly domestic businesses, asked to reduce drug prices. Nevertheless, these enterprises’ drug price cuts are considered an unhealthy competition tool. An official of the Pharmaceutical Management Department affirmed that the proposal to decrease the prices of some ordinary types of drugs of domestic enterprises will prevent the pharmaceutical sector from further developing because they cannot encourage investment in production lines for re-investment.
To better manage the drug prices, the Pharmaceutical Management Department will announce the prices of imported-drugs in the first quarter of this year so that the retail and wholesale units can select suitable suppliers. Following this, they will release the set retail prices to the public.
Mr Cuong said that circular No.08 require the public announcement of the retail prices of drugs will cause difficultiesfor consumers.
By February 125, the Pharmaceutical Management Department had not yet allowed any businesses to increase drug prices. Representatives from the department affirmed that there will be no sudden increase in the drug prices in 2006. If the price of any types of drugs rises by more than 5 percent, the Ministry of Health will use the national drug store.
(Source: VOV)
