Don't raise price of generic drugs, NGO says
Don't raise price of generic drugs, NGO says
Sari P. Setiogi, The Jakarta Post, Jakarta
The Indonesian Health Consumers Foundation (YLKKI) has rejected
as irrational the government's plan to raise the price of generic
drugs by 6 percent to 7 percent this year.
"In a situation where the economic position of most people is
relatively weak, increasing the price of generic drugs is not the
right decision," YLKKI chairman Marius Widjajanto told The
Jakarta Post on Saturday.
The supply of generic (unbranded) drugs is expected to meet
the medication needs of people on a limited budget, as they are
sold more cheaply than branded drugs.
Marius said that in May 2003 the government offered discounts
of 10 percent to 70 percent on generic drugs at outlets and
drugstores.
"That means the government still makes a lot from selling
generic drugs, so why should it increase the price?" Marius said.
He added that the appreciation of the rupiah against the U.S.
dollar should have brought down the price of medication, instead
of increasing it.
"Previously, drug producers said the price was high because
many of the ingredients were imported," he said.
Most imported drugs distributed in the country come from India
and Greece. "The drug producers are eager to sell their products
here, as they make more of a profit," said Marius.
Health Minister Achmad Sujudi said last Tuesday that the
planned increase was aimed at improving the distribution of
generic drugs.
"The government has tried to provide low-cost medication for
the community by supplying generic (unbranded) drugs, but outlets
and distributors don't like low prices, as they reduce their
margins," Sujudi said.
"If the distribution side doesn't work, that is a problem
because we operate under a market system. It's therefore
necessary to increase the price (of generic drugs)," he said.
He guaranteed, however, that the new prices would still be far
below those of branded drugs.
According to Marius, the price differential here between
generic and branded drugs can reach 600 percent.
He cited as an example the price of a 500-milligram tablet of
the antibiotic, amoxicillin. The generic version is available at
Rp 560 (about 7 U.S. cents) per tablet, while the branded one can
be as much as Rp 3,000 per tablet.
"Abroad, the price differential is only 20 percent to 30
percent," said Marius. He thought that the price of the generic
drug could still be set at about Rp 300 per tablet. "At that
price, the producer can still make a profit."
"Why is the government so reluctant to deal with the
distributors?" Marius asked.
"Most distributors not only distribute generic drugs, but also
branded ones. With such large margins, they can make a huge
profit on the branded ones," Marius said.