On January 21 a new rule was set into action that requires drugstores to limit prices for drugs that are used for COVID-19 medical treatment. According to drugstore owners, this rule may lead to a deficit of those drugs as the business is no longer interested in selling them.
As health system officials said, the new rule is designed to prevent a summer scenario when people couldn’t find proper drugs amid the spike of coronavirus.
The rule covers 230 items that have been used in the COVID-19 treatment. It is expected that the price limitation will help make prices lower by 27%. To achieve this goal, the ministry has offered to not use marketing costs in price calculation as well as to lower margins in retail and bulk sales.
The changes were initiated by the Agency for Protection and Development of Competition (APDC), which made an analysis of the drug prices and figured out how to lower prices. Usually, distributors only work with brokers while ignoring drug producers, and of course, they do not care about how high the price is. However, when responding to the Kursiv edition, the agency refused to reveal companies that maintain this practice by saying that it is sensitive information.
Not only COVID
According to drugstores, the new rule by the health system may lead to absolutely different results, for instance not to make prices lower, but make drugs used for treating COVID and other diseases disappear. Even before the rule went into effect, the businesses said it won’t be cost-effective to sell these drugs.
«Several drugs will disappear. For example, we were told to price Sumamed at 3641 tenge ($8.70), but the bulk sale price is 4600 tenge ($10.99). As it’s supposed, we should cover 1000 tenge ($2.39) from our pocket, but we are not interested in such a business and would prefer to not sell these drugs at all,» said Talgat Omarov, the owner of the Arys Farm drugstore.
A similar opinion was expressed by Andrey Klimenko, head of the Astana-Farma drugstore, who said that the warehouses are full of medicine and now business is forced to make a sacrifice and sell at a loss.
As initiative group members noted, among the drugs most likely to disappear are Ciprolet, Zinnat (antibiotics), Cardiomagnyl, Trombopol (thrombosis drugs), Heparin and Xarelto (anticoagulants). The health system’s list also added eye drops (Ciprolet, Signecef) and gels (Heparin, Lioton) because they might be used for COVID-19 treatment.
«All this mess is a result of the unprofessional approach of those who have made this list of drugs. They just are not pharmaceutical specialists. It’s a good idea to support people during these tough times, but you can’t ignore the consequences such as the disappearance of certain drugs. As a result, consumers won’t be able to buy even cheap heparin gel that was always available without any prescription for thrombophlebitis treatment. This is just one particular example and we have a lot of them,» said Natalya Filatova, head of the Salus 2 drugstore from Kostanay.
Commenting on the issue, the acting Director of the Medicines Policy Department under the Ministry of Health Botagoz Syzdykova noted that the agency has prepared the new proposition on price limitations.
«The current list of drugs is based on clinical protocols for COVID-19 treatment. Concerning those drugs that were never used for this purpose but were added to the list, we have formed a new project of drugs that should have limited prices,» she stated.
New year – new prices
Another example of the mess with prices was shown by Maral Sailybayeva, owner of a drugstore in Nur-Sultan.
«Clexane’s price is now limited to 13,000 tenge ($31.07), which does not even meet the producer’s price. We used to sell it for 18,000 tenge ($43.02) and currently, I have 156 items of it that I have bought for 17,000 tenge ($40.63) per item. I am not going to sell it because I can’t make the price lower. At the same time, I can’t sell it for a real price because I don’t want to mess with the government and be punished. This drug is necessary for pregnant women after In Vitro Fertilization; the babies need it. Women cry and ask me to sell but I can’t. It’s crazy, I don’t understand the purpose of the list that the health ministry has created,» the woman said.
Price regulation is common for Kazakhstan pharm business since 2019. From the beginning of this practice to the end of 2020, the price of Kleksan was 15,267 tenge ($36.49) for bulk sale and 18,625 ($44.51) for retail. Now it will be 11,603 ($27.73) and 13,053 ($31.2) respectively. So, indeed the difference in 2214 tenge ($5.29) which drugstore owners must cover from their own pocket.
The initiative group of drugstore owners believes that the special joint commission, which may consist of ministry officials, drugstore owners, and industry association representatives, should be created. However, until there is no such commission, the new rule should be rolled back.
The initiative group’s statement is not the only one. On January 14 five industry associations (Association of International Pharmaceutical Producers, Association for Support and Development of the Pharmaceutical Activities in Kazakhstan, Association of the Pharm Products Distributors, Eurasian Medical Association, and Pharmaceutical and Medical Industry of Kazakhstan Association) asked Aleksey Tsoy, head of the health system, Serik Zhumangarin, head of the APDC, and Nurlybek Asylbekov, deputy head of the Committee on Medical and Pharmaceutical Control to roll back the order or postpone it for three months to let distributors and drugstores sell all these drugs.
However, the Ministry of Health rejected those initiatives and on January 21 the order went into action. The ministry has just promised to use a case-by-case approach during the inspections.
«We will inspect not only drugstores but also producers and distributors to make sure that the price ceiling principle is respected,» Syzdykova said.
Moreover, the agency said the SK Pharmacy, which is a state-owned company responsible for drug supply, has already bought 44 items, including anticoagulants, antibiotics and non-steroid hormones.
«If we see a deficit of medicine, the local stabilization funds will replenish stocks of it,» added Botagoz Syzdykova.
The requirement to make drug prices lower was made public by President Kassym-Jomart Tokayev on November 16, 2020.