Unrealistic pricing in the local pharmaceuticals has already led to the withdrawal of many trusted brands from the market, a recent audit report by the National Audit Office of Sri Lanka stated
The discussion on the pricing of medicinal drugs in Sri Lanka has been ongoing for years without any substantial progress. This questions the reasonableness and accuracy of the Maximum Retail Price set by the authorities.
Pharmaceutical pricing is an emotive subject and many patients do not understand the costs involved in producing quality medicines. The demand for low-priced generics has led to a WHO report indicating that about 30% of medicines in countries like Mexico, Pakistan, and India are fake or substandard.
“Sri Lanka must take all necessary steps to avoid such a calamity in its pursuit of cheap medicines,” the report stated.
A structured Pricing Mechanism is urgently needed, covering manufacturers, importers, distributors, and retailers.
“This mechanism should segment products into essential and non-essential categories and account for inflation and other costs. Viable margins must be incorporated to ensure the availability of quality medicines, contributing to a healthier society,” it stated.
Medicines must be priced based not only on cost but also on efficacy and safety. The quality of raw materials, packaging, quality control, storage, and transportation are all essential to ensure that consumers receive products that meet their doctors’ diagnoses confidently.
Recent incidents involving the import of substandard drugs have had disastrous, even criminal, impacts on patients.
The National Medicinal Drugs Act mandates the formation of a Pricing Committee composed of various experts to establish a Pricing Mechanism for all registered medicines. “Unfortunately, these crucial steps have been overlooked for reasons that remain unclear.”
To avoid the influx of fake, counterfeit, and substandard medicines, it is essential to define a practical pricing mechanism. Medicines, whether imported or locally manufactured, rely on foreign exchange, and dealers need protection against currency fluctuations. Additionally, all medicines must be stored at recommended temperatures, which incur significant costs.
The global inflationary environment, driven by wars and other disruptions, naturally leads to increased prices for raw materials and finished drugs, affecting local retail prices.
The production of medicines involves not only raw materials but also special packaging, especially in Sri Lanka’s high-humidity climate, to maintain stability and potency.
