Pharmaceutical industry ready to cut drug prices by up to 13%

• Renews calls to establish transparent, equitable and fair pricing mechanism 

While renewing calls for an equitable and fair pricing mechanism,  Sri Lanka Chamber of Pharmaceutical Industry (SLCPI) yesterday said the industry stands ready to reduce prices of pharmaceuticals upto 13 percent in line with the recent rupee appreciation under the condition of flexibility for future price increases in case of  deprecation of the currency.

“The current value of the dollar justifies a price decrease of 10 percent-13 percent in pharmaceuticals when all factors are taken into account. This is the same price reduction the SLCPI proposed in writing to the Minister of Health. However, any price decrease at the present time must be with a provison for a price increase if there is an appreciation of the dollar,” a SLCPI statement said.

It pointed out that rupee has already seen a slight depreciation in the last few days after appreciation by over 20 percent against the US dollar during the year.

Although, the government has allowed price increases , the SLCPI noted that the final price increase was allowed in April last year when the US dollar was reading at Rs.352. 

“After that the dollar reached a peak of Rs.372 and the pharmaceutical industry was not allowed to increase prices any further for a period of almost 10 months. The dollar deprecation only started,” it said Last year, the government has allowed price increases of 5 percent, 14.4 percent, 9 percent, 29 percent and 40 percent respectively in order to counter the impact of the rapidly depreciating rupee.

Currently, 61 molecules covering more than 900 common generic/brands used to treat most chronic illnesses such as diabetes, heart disease, hypertension, and also most common antibiotics are under a strict price control regime.

These 61 molecules where strict gazetted price control is applied, account for approximately 35 percent of the most commonly consumed  medicines according to independent IQVIA data.  Other than these 61 molecules, all others have their initial price determined by the National Medicines Regulatory Authority (NMRA) where the prices in the country of origin as well as the regional prices are considered in determining the final price. This price too is re-evaluated during the issuing of import licences every year and when the registration is renewed every five years.

With the introduction of price controls with effect from 2016, SLCPI stressed that ‘market forces’ no longer apply to pharmaceutical pricing.

Moving forward, SLCPI urged the government to establish a transparent, equitable and fair pricing mechanism to ensure an uninterrupted and uniform supply of high-quality pharmaceuticals to the general public.