The Argentine ministry of commerce (MoC) has an initial agreement with the main representatives of the pharmaceutical industry to maintain a price freeze on around 138 medicines until December.
Implications | The list of drugs included in the price freeze plan would be quite restricted, comprising about 138 active ingredients, including over-the-counter (OTC) and best-selling medicines. Second-tier brand treatments will also be included in the price-fixing programme. |
Outlook | Although some pharmaceutical companies have already agreed to sign the agreement, some parts of the industry have resisted these government measures, stressing that the industry should fix its own prices. |
Argentina's ministry of commerce (MoC) has an initial agreement with the main representatives of the pharmaceutical industry in Argentina – the Industrial Chamber of Argentine Pharmaceutical Laboratories (Cilfa), the Argentina Chamber of Medical Specialities (Caeme), and the Business Chamber of Pharmaceutical Laboratories (Cooperala) – to maintain a price freeze on certain medicines until December, reports Pharma Biz.
According to the source, the list of drugs included in the price freeze plan comprises about 138 active ingredients. The draft of the list that details the medicines that are likely to be included can be accessed here.
The draft list contains over-the-counter (OTC) and best-selling medicines. Second-tier brand drugs will also be included in the price-fixing programme, with such treatments effectively benefiting from advertising. According to the newspaper La Nacion, the Argentine government plans to fix the prices of these initial 138 medicines included in the draft list until the end of the year.
Outlook and implications
Although some pharmaceutical companies have already agreed to sign the agreement, some parts of the industry have resisted these government measures, stressing that the industry should fix its own prices, and have expressed concerns about fines if pharmacies do not stick to the price plan. Pharmaceutical companies must also ensure the normal supply and sales of medicines, at guaranteed prices.
Officials have not revealed the number of manufacturers that have approved this agreement, although it is hoped that 85 firms will participate in the programme overall. In the long term, once prices are brought under control, the government aims to do away with such programmes and generate greater competition in the pharmaceutical sector through measures such as the implementation of generic medicine legislation. The MoC's current proposal about frozen prices comes after the prices of some drugs increased by more than 10%, contravening the ministry's ruling that price increases should not exceed 5% (see Argentina: 17 March 2016: Survey shows medicine prices increase on average by 15.76% in Argentina and Argentina: 4 February 2016: Argentina's MoC agrees to 5% medicine price reduction).
The MoC has set a precedent of imposing price freezes. In June 2014, the ministry published a resolution ordering the pharmaceutical industry to reduce medicine prices to the level recorded on 7 May that year, and to maintain these prices for 60 days (see Argentina: 25 June 2014: Argentine government promulgates price-reduction resolution in medicines). The response of the pharmaceutical industry to the enforcement of the proposed regulation requiring it to maintain its drug prices at the same level until December remains to be seen. However, considering the high levels of inflation and production costs in the Argentine market, it is unlikely that a potential approval and enforcement of these measures will be fully welcomed by the industry.