Cost of 132 drugs decreased

Reem Leila, Sunday 26 Dec 2010

The Health Ministry has moved to reduce the price on an additional tranche of drugs with a full review of all prices ongoing

Hatem El-Gebali, Egypt's minister of health, has announced that some 132 drugs will be subject to price cuts.

The prices, according to El-Gabali, will be reduced by 10–60 per cent. The minister affirmed that the decree would amend the process of medicine pricing and will not lead to any increase in prices, as some thought, but rather opportunity for a periodic review of prices.

Foreign drugs routinely go could through exhaustive procedures before being priced and approved for sale in Egypt. The decree is an attempt to reform these regulations. The new system sets prices in accordance with the lowest price in foreign markets, with an additional 10 per cent discount. Foreign pharmaceutical companies have accepted the decree.

Abdel-Rahman Shahin, spokesman of the Ministry of Health, told Ahram Online that the decree did not yet come into force, but will come into effect "on newly introduced medicine". According to Shahin, reducing the cost of medicines will help consumers. “We can’t allow [pharmaceutical] companies to fool us by selling us medicine at higher prices than that of our neighbouring countries,” he added.

Drugs whose prices have been reduced include those to treat liver and kidney disorders, high blood pressure, some medicine used for patients suffering cardiac diseases, in addition to anti-biotic medicines for children. According to Shahin, Egypt is among very few countries that subsidises medicine. 

“These international companies have their factories in Egypt while the country subsidises electricity, gas and water.” Accordingly, the overall cost of manufacturing medicine is cheaper than in other countries. Moreover, Egypt has a high population density. “Selling medicine to a country with only 20 million people is not equivalent to selling to a 80 million-strong country,” he said.

According to Shahin, the new decree will be assessed after two years, in order to evaluate its efficacy. “Both parties will be free in continuing with the agreement, or in terminating it.”

This decree coincides with a Ministry of Health review of prices of medicines. According to Kamal Sabra, assistant to the health minister for pharmaceutical affairs, the ministry has checked drug prices in neighbouring countries and some European countries. “We discovered that prices are lower than in Egypt,” Sabra said.

Some 93 medicines out of 9,000 in Egypt have been found to be higher in price than in neighbouring or European countries. “Accordingly, the minister agreed with international pharmaceutical companies to sell us the medicine at lower prices,” Sabra said.

Those who violate the decree will face severe penalties, including the closure of pharmacies. Meanwhile, pharmacists' profit margins will be upheld. “It is protected by the power of law. They have a fixed per cent of profit on the medicine whatever its price is,” Shahin added.

The rest of the 9,000 drugs will be reviewed within the coming months.

This is not the first time the ministry has moved to decrease the price of medicines. In March, the prices of 60 drugs were reduced by 10-60 per cent, followed in April by reductions on an additional 40 drugs.

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