Indonesian Medicine Prices Five Times Higher than Malaysia, Prompting Anti-Corruption Agency Intervention
Health Minister Budi Gunadi Sadikin has complained that pharmaceutical prices in Indonesia are five times more expensive than those in Malaysia. The Anti-Corruption Commission (KPK) has stepped in to investigate the causes of this significant price disparity.
Sadikin made these remarks during a ceremony to sign a memorandum of understanding (MoU) between the Indonesian Health Ministry and the KPK regarding efforts to eliminate corrupt practices in the healthcare sector at the Health Ministry building in Jakarta on Wednesday (11 March 2026).
Sadikin highlighted that one of the most common complaints from the public concerns the high cost of medicines in Indonesia compared to other countries, including Malaysia. “The issue that probably affects most people is expensive medicine. Compared to Malaysia, the difference can be three to five times more expensive,” he said during his address.
Suspected Systemic Corruption
Sadikin assessed that the substantial price difference with Malaysia could not be solely attributable to taxation. “People in the health industry say, ‘Sir, it’s because of taxes’. But taxes are only 20 to 30 per cent—how can that result in a 500 per cent increase? The maths doesn’t add up,” he said, in remarks made in the presence of KPK Chairman Setyo Budiyanto.
This suggests there are other undisclosed factors at play beyond taxation. “It’s impossible. There must be other things beyond taxes that they don’t want to disclose. It definitely isn’t taxes,” he stated.
Sadikin characterised the high medicine prices as potentially indicative of systemic corruption within the healthcare industry ecosystem. Systemic corruption refers to corrupt practices that occur widely and in a structured manner within a system.
He explained that the healthcare industry involves numerous stakeholders, including regulators, hospitals, health insurers, medical professionals, and pharmaceutical companies. “We want to improve corrupt behaviour in this industry. Because beyond the Health Ministry as a regulator, there are hospitals, health insurers, doctors, and pharmaceutical companies that build the healthcare industry ecosystem,” Sadikin said.
Requesting KPK Assistance
He therefore hopes the KPK can help reorganise the healthcare sector to be more transparent and free from corrupt practices. “We truly expect the KPK to help us. Not only to clean up our institutions, but also to eliminate systemic corruption from our industry,” he said.
KPK Response
The KPK welcomed the Health Minister’s commitment to anti-corruption efforts. The KPK explained that anti-corruption work can be conducted through three simultaneous approaches: education, prevention, and enforcement.
“Through a prevention approach, the KPK together with the Health Ministry can strengthen systems, governance, and corruption risk mitigation, especially in programmes with significant budget allocations,” said KPK spokesperson Budi Prasetyo to journalists on Thursday (12 March 2026).
He also stated that should evidence of irregularities in the pharmaceutical sales industry be discovered, the KPK will immediately take enforcement action in accordance with applicable regulations. “However, should indications or suspicions of corrupt acts be found during the process, the KPK will certainly follow up in accordance with its authority as regulated in the legislation,” Prasetyo said.
KPK Commitment
The KPK views the healthcare sector as highly strategic because it manages large state budgets. According to the KPK, the healthcare sector also directly affects the welfare of the general population.
Synergy between the KPK and the Health Ministry is important to ensure that every programme and budget allocation truly provides optimal benefits to the public, whilst also serving as protection against irregular practices.
“The KPK hopes this commitment to transparency and collaboration can continue to be strengthened so that efforts to prevent and combat corruption in the healthcare sector can run effectively, thereby safeguarding the integrity of government governance whilst improving the quality of healthcare services for the public,” Prasetyo added.