Pharmaceutical companies could cut labor because of the drug price limit

Last updated on May 6th, 2021 at 08:10 am

The Philippine Pharmaceutical and Healthcare Association (PHAP) on Tuesday cautioned that pharmaceutical companies will reduce their labor force as a result of potential loss of competitiveness due to the high retail price recently levied on certain medicines.

PHAP’s opposition to price control has been consistent since global experience showed that artificial measures lead to market inefficiencies and lack of supply

In the absence of fair income, pharmaceutical companies should review the viability of their activities in the Philippines, including the potential reduction in the number of employees.

President Rodrigo Duterte signed Executive Order 104 on Monday imposing a maximum retail price on at least 133 types of drugs. The order is aimed at “improving the access of the Filipinos to affordable medicines.”

Health Department (DOH) earlier said its plan for price control covered medicines for obesity, diabetes, cardiovascular disease, chronic lung diseases, neonatal diseases and major cancers, high-cost treatments for chronic renal disease, psoriasis and rheumatoid arthritis.

Nonetheless, the PHAP said it would comply with the EO on the maximum retail price for medicines “but calls on the government to track closely its effect on the pharmaceutical industry and the general public.” The group said it had yet to obtain an official copy of the EO “to fully understand its effects on PHAP members and the public.”

According to PHAP, this would potentially result in higher prices, an inconsistency between goal and implementation.

PHAP also stressed that the introduction of innovative drugs or new drugs and vaccines produced from years of expensive research to address current or emerging health threats is unlikely in the Philippines.

Instead of price control, PHAP said it proposed a straight price reduction of 150 medicines earlier and also offered a system that would not leave medicines expired and wasted in DOH warehouses.

PHAP shares the goal of lowering the prices of pharmaceutical products but calls on the government to accept bulk procurement and price bargaining as a more efficient and profitable strategy. To see more latest news about philippines link us.