Govt to raise price of generic drugs by 15%

JAKARTA (JP): Minister of Health Sujudi has said the government would raise the price of generic drugs by as much as 15 percent after March.

The price hike, he said, was necessary because prices of imported raw materials to make the drugs had continued to soar due to the depreciating value of the rupiah against U.S. dollar.

Currently, the pharmaceutical industry still had to import 70 percent to 80 percent of its raw materials used to manufacture quality drugs, he said.

"I will approve the raise and it will be taken step by step," said Sujudi during a fast breaking gathering with officials from the Health Ministry and members of the House of Representatives Commission VI at his residence Saturday.

Legislators in Commission VI are responsible for health and social affairs.

Records from the health ministry show that the import of raw materials has increased in value in the last two years. Last year, it reached US$178.32 million, some $22 million higher than in 1994.

The government introduced generic drugs in 1989 so customers could purchase quality drugs at more affordable prices.

There are now reportedly 201 types of generic drugs on the Indonesian market.

During the 1996/1997 fiscal year, the total value of the drugs' distribution to stores and health centers throughout the country reached Rp 378 billion ($63 million).

The annual per capita drug consumption in Indonesian was just $6 last year, still considered low among Asian countries compared to South Korea, Taiwan, Singapore and Thailand.

Since 1993, the price of generic drugs has been relatively stable, with the government subsidizing its distribution to community health centers in villages throughout the country.

The drugs are manufactured by 54 out of the 225 pharmaceutical companies operating in Indonesia. Forty-seven of the companies producing the generic drugs are privately owned.

While maintaining that the government had no choice in raising the price of generic drugs, Sujudi still made an appeal to patent-owning medicine manufacturers not to raise prices.

He said many Indonesians were dependent on these drugs which were not available in generic form.

"If they set a high price, nobody will be able to buy it. In the ongoing monetary crisis, their markets have become slanted since people prefer to buy generic drugs (with a more affordable price)," he said.

Already there have been reports that patent medicine prices have increased by two to three times in some parts of Indonesia since August last year when the monetary crisis began.

In a separate development, an official in Bengkulu said a pharmacy had been caught selling fake medicine.

Head of the Bengkulu heath office, Bachtiar Karatu, when asked to comment on the report, remarked that it was very harmful since patient trust in drug manufacturing companies would suffer.

Bachtiar said his office conducted routine investigations of medicine dispensaries every six months in order to detect any illegal sales of fake medicine. (09)