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Cyprus

Auditor seeks to break pharma monopolies that drive up prices

THE health ministry should roll out measures as soon as possible to tackle the absence of competition and monopolistic conditions in the pharmaceutical market which drive up prices, in some cases, hurting public interest, the auditor-general said in a special report on the issue.

In an effort to correct the situation, the auditor recommended changing the way the average wholesale price was set, revoking the licence of companies that repeatedly and without justification, refuse to take part in public competitions, prohibiting the same company from holding permits for more than one alternative drug, and simplifying procedures for importing pharmaceuticals through parallel imports to increase competition.

The health minister, according to the report, informed the audit service that every effort was made to ensure pharmaceutical adequacy, guided by public interest and rational use of public expenditure.

As regards the red tape, the minister said the objective was to ensure quality, safety, and the effectiveness of pharmaceutical products.

The information required is the same as in all member states of the EU, in line with European directives and the guiding lines of the European pharmaceutical organisation.

“Concerning parallel imports, he (the minister) informed us that despite the fact that our legislation provides for issuing permits for parallel imports, it has been observed that interest from companies was low,” the report said.

Since 2004, the pharmaceutical council has received 63 applications, the report said.

According to the ministry, the drugs that were brought in through parallel imports were sold at the same price as the reference medicines and there was no benefit to the patients.

The auditor pointed out that these companies could submit lower bids in public competitions and give pharmacies better prices. The average wholesale price did not prohibit submitting a lower price, “something that happens frequently in state tenders where there are alternative medicines.”

The minister said revoking the licence of companies that refused to take part in state competitions was not provided for in the legislation, which was harmonised with the relevant European directive.

“Possible implementation of this measure would endanger the availability and the adequacy of pharmaceutical products in the market, as well as deprive doctors from options when prescribing and patient access to the private sector,” the ministry said.

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