Challenges In Regulating The Pricing Of Medicines In South Africa 2003 – 2008

The pricing of medicines has been unregulated in South Africa until the recentpast. The pharmaceutical industry was the sole determinant of medicinespricing, resulting in high medicine prices acting as barriers to access tomedicines and therefore quality healthcare for many South Africans. Thisphenomenon is not only true for developing countries like South Africa, but alsoan international dilemma affecting the developed countries of the world. Theadoption of the National Drug Policy in 1996 and subsequent legislative changesincluding the introduction of regulations for the pricing of medicines in 2003generated high interest. The new medicine pricing regulatory environment wouldsee the setting of a single exit price for medicines, elimination of a mark-upsystem and perverse incentives, and the imposition of limits to professional fees(e.g. dispensing fees) charged on medicines. It was considered a crucialintervention intended, inter alia, to lower the cost of medicines, promote costeffective and rational use of medicines.A qualitative research methodology was used to collect data by interviewingparticipants (i.e. mainly retail pharmacists and consumers) in urban and semiurban environments in the Limpopo province. In addition, key nationalgovernment officials responsible for the medicines pricing policy andrepresentatives of pharmacy professionals’ associations were interviewed. Aquantitative dimension was also selectively pursued to further elaborateemerging patterns. Information such as lists of newly opened or closed retailpharmacies, amongst others in addition to descriptive records were requested foranalysis following qualitative interviews.The study found implementation process was characterized by conflict betweenstakeholders and government. Several different stakeholders at different stagesargued or contested certain legislative aspects citing poor consultation andnegative effects for the industry in general.IIIIn respect of retail pharmacy, the ongoing difference is around the formula todetermine appropriate dispensing fees. Early signs of unintended outcomes weredetected like the closure of independent pharmacies versus opening of newpharmacies by big retail industry players. In addition, the prolonged differencewith the retail pharmacy industry sustains in certain areas high medicines prices,somehow violating the socioeconomic rights of citizens, and thereforeunconstitutional. Interestingly, following the implementation of the MedicinesAmendment Act in 2003, medicines have become affordable, though this benefithas not been fully transferred to the South African Public.Access to medicines remains an elusive concept in semi-rural and ruralenvironments requiring some government intervention to create access. Aflexible framework for dispensing fees is therefore proposed for the retailpharmacy industry amongst other government interventions to derive maximumbenefit for the South African public from this policy intervention. In addition,government should consider public private partnerships amongst otherinterventions to address access to medicines in rural areas.