South Africa will announce draft regulations on Friday that aim to slash medicine prices by up to 70%, Health Minister Manto Tshabalala-Msimang said in Pretoria on Thursday.
Cheap medicines are a burning issue in South Africa where about 5,3-million in a population of 44,8-million are infected with HIV or Aids, a higher number than any other country.
The minister told a news conference on Thursday that the regulations on transparent pricing had been delayed by four years due to legal action by pharmaceutical companies.
The draft regulations will give the pharmaceutical industry three months to comment before the government enforces them through legislation in May, she said.
”When these regulations are fully implemented, the price of medicines to consumers would be between 40% and 70% lower than the current levels,” the minister said.
”Our research has indicated that formally listed manufacturers’ net price of medicines has been inflated to allow for the impact of a complex system of bonuses, rebates and other incentive schemes within the pharmaceutical industry.
”This incentive system allows hospital groups, pharmacy groups and other major outlets to obtain medicines at prices about 50% below the manufacturers’ net prices,” she said.
”Due to complex mark-ups in the distribution chain, the consumer seldom benefits from this incentive system.”
The new regulations will ban the supply of medicine through these incentive schemes and permit the single exit price of medicine to be set at no higher than 50% of the present listed price.
Recently, the South African government announced that more than R320-million has been allocated for the rest of the fiscal year — until March 31 — to fight HIV/Aids, and that it would supply anti-retroviral drugs, after tremendous pressure from lobby groups that it was ignoring the pandemic. — AFP
