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Consumers to gov’t: No turning back on lower drug prices

By Bernie Cahiles-Magkilat

Consumer group Laban Konsyumer Inc (LKI) has warned government against turning back on its commitment to implement Executive Order 104, which will slash prices on essential and life-saving drugs.

LKI President Victorio Mario Dimagiba said “there should be no turning back” as EO 104 will take effect next month, June 2.

Atty. Vic Dimagiba

LKI President Victorio Mario A. Dimagiba

In a radio interview with Angelo Palmones of DZRH , Dimagiba also noted they while some relief for consumers were granted during this lockdown, “We still struggle to make money and raise enough funds for our expenses, medicine prices will be going down very soon.”

Dimagiba pointed out under the EO, 135 medicines will see their prices drop by 45 to 55 percent of
their current prices.

This includes hypertension, diabetes, anti-asthma, anti-coagulant, anti-depressant, and anti-viral medicines. This has been studied for a long time, and this was issued by the President by Executive Order 104 in February 2020. This price drop should start on June 2.

The Department of Health will come out with an infomercial campaign so consumers by next week will know about this. There will also be posters in the drugstores. Consumers will know what are the new prices of medicines. Consumers with maintenance medicine will know the lower prices they will pay for.”

Dimagiba explained “We cannot tolerate the pharmaceutical companies going against
this drop in prices, because they admitted that their prices have already gone up, admitting that their prices for medicine is already high. The EO shall grant access to medicine at lower prices. This executive order was not just signed, there was a lot of technical review, and in our view, the implementation of this EO is very timely because of the pandemic. We must follow the government’s wishes, and implement these low prices immediately for the welfare of consumers. The major pharma companies should not counter these moves, as now is not the time to complain about losing money when this crisis of coronavirus is taking away livelihoods of our fellow brothers and sisters.”

“This drop in medicine prices… is the best news that should start already for everybody, whether senior citizen or PWD. We want to see this reduction of 40 to 50 percent in list of medicine prices,” he said.

DOH and DTI ordered that within 30 days, there should be additional medicines added to the list, but the pandemic got in the way and prevented additional medicines to be put in.

Dimagiba further pointed out that based on the Bayanihan Act, big pharmaceutical companies should not anymore complain about the billions they will lose in taxes. “Consumers are the ones paying these taxes, so them complaining about the loss in billions makes them indirectly admitting to their current or recent high prices. It is only just that the prices they pay for medicine is lowered now for the good of all consumers,” LKI concluded.

Earlier, the Pharmaceutical and Healthcare Association of the Philippines (PHAP) warned the government stands to lose P28 billion in revenues as a result of price controls on medicine, according to PHAP, a group of branded or the research-based Filipino and multinational pharmaceutical firms in the country, issued this statement as the Executive Order 104 entitled “Improving Access to Healthcare through the Regulation of Prices in the Retail of Drugs and Medicine” will take effect next month, June 2, 2020.

Under the EO, 87 drug molecules (equivalent to 133 preparations/ formulas) were placed under the Maximum Retail Price (MRP) and Maximum Wholesale Price (MWP).

EO 104 will slash the prices of medicines from the manufacturers’ level but not all prices will be reduced at the patient level.

The industry projects its sales to drop by P57 billion from P200 billion once the full price control plan of the Department of Health, is fully implemented,

Projected government revenue losses are broken down into: P4 billion in foregone customs duties; P7 billion in lost VAT; and P17 billion in corporate taxes.

“The EO does not benefit the public in the end because of the formula used to compute the price adjustments. We appeal that the measure be withdrawn until further studies especially at this time when the government needs funds to fight Covid-19,” said PHAP.

It added: “Price control has not been effective based on global experience. It is a populist proposition but discourages production, creating scarcity that will likely hurt those in need of the medicines the most, and shrinks an industry. We continue to appeal for a thorough review on the impact of this policy.”

Instead, PHAP said the government should continue the practice of buying in bulk and price negotiation to assure both supply and price stability.

Instead of implementing the EO, PHAP appeals DOH for policy recall, return to market forces and sustainable medicine.


Source: Manila Bulletin (https://business.mb.com.ph/2020/05/26/consumers-to-govt-no-turning-back-on-lower-drug-prices/)

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