The United South African Pharmacies (Usap), an industry body representing more than 1 200 community pharmacies, says Monday’s Supreme Court of Appeal decision to set aside the government’s medicine-pricing regulations provides an opportunity for pharmacies to adopt a pricing model that it believes will be acceptable to all role players.
Julian Solomon, chairperson of Usap, said on Tuesday: ”There are a few dispensing-fee models produced by various independent bodies that are now being evaluated by the Pharmacy Benefit Management companies with a view to resolving the pricing impasse now imposed on the profession.”
Solomon says the pricing models are based on the smoothed-curve principle.
”They consist of a combination of a fixed rand amount and percentage value that provides for an acceptable return on the spectrum of drug prices without inflating the top-end drug prices,” he said.
Solomon said while Monday’s court ruling vindicates pharmacies’ position over the past year, it in itself does not completely clear up the confusion.
”The only thing that will clarify matters is for the Department of Health to talk directly to all the players in the industry. Cooperation is the best way to achieve the objects of the Act as well as bring the full effect of price reductions to the public.
”Cooperation has to be more effective than confrontation. If done reasonably and sensibly, the entire issue could be resolved within a matter of hours.”
Usap spokesperson Isgak Ismail said: ”Government has previously said that it was unable to engage in talks because of the court proceedings. Now that the Appeal Court has ruled on the issue, the department has unfortunately already issued a statement that they will appeal to the Constitutional Court.
”We believe they should withdraw it from the courts and seriously consider the industry’s alternative recommendations on an equitable fee for retail pharmacies.”
Ismail says pharmacies cannot afford to wait for the case to go to the Constitutional Court, which could take many more months.
”The reason more pharmacies haven’t closed their doors is that they were expecting the case to be resolved quite soon. Many were just breaking even with the capped dispensing fee, but they cannot continue in that state for much longer.”
Pharmacies bearing the particular brunt of the regulations, which were introduced in July, are those in the more economically marginal areas. Ismail, who runs a pharmacy in Elsies River in Cape Town, says he cannot charge the administrative fees that have kept other businesses afloat as his customers simply cannot afford them.
”Medical aids were refusing to absorb these costs, which many pharmacies considered a survival fee. Our decision in the next few days to implement a fee structure which is acceptable to pharmacies and medical aids alike will bring welcome relief to all concerned.
”As health-care providers, pharmacists understand the need for affordable health care. We therefore support the aims of the legislation. A fee that does not cover even the basic operating costs of a pharmacy is clearly unworkable. Government must work with us to adjust the fee if it wants pharmacies to stay open.”
Solomon offered the following appeal to the Department of Health: ”Having heard from the courts, having heard from the profession, having heard from every quarter in South Africa, you have been given a wonderful chance to now urgently review the position, and rectify the problems, which you have, on occasions, promised to do.” — I-Net Bridge
Related articles
Dept of Health doesn’t give up
‘The judgement was wrong’