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Johannesburg - Industry experts have questioned government's new price regulation proposals for pharmacies, but health and pharmacy retail group Clicks is supporting the proposed new system.
Last week, the department of health announced a revised version of the controversial four-tier pricing structure aimed at regulating medicine prices, with an introduction of an exemption arrangement for pharmacies from maximum levies.
The price regulation proposal - which requires pharmacies to charge a levy of 26%, capped at R26 - has been a thorny issue between government and pharmacies since 2004. Small independent pharmacies complain that price regulations will force them out of business.
According to the new version of the four-tier structure, retail pharmacies can apply to the department of health for exemption from the maximum dispensing fees. Pharmacies who wished to be exempted would have to propose alternative fees.
Those granted the exemption will have to inform customers that they are charging higher rates.
"The figures are identical to the ones given to us six months ago," said Drew Horner, chairperson of United South African Pharmacies said.
Horner said that "the financial viability is what we are challenging, the rest we don't mind". His organisation is in consultation with the department of health. The minister has asked United SA Pharmacists to keep the matter out of court.
However, the practicality of the proposed exemption system has been questioned, with industry analyst Peter Breitenbach of Frost and Sullivan saying that it will depend on how government will manage the system.
Breitenbach says if the department of health can manage the exemption process efficiently, then it could be practical.
"Although as I understand it, qualifying businesses will need to renew this exemption every year, which given the timelines, effectively means businesses have to apply twice per annum - and that is impractical in any system," says Breitenbach.
Health and pharmacy retail group Clicks expressed its support for the proposed dispensing fees.
Clicks CEO David Kneale told Fin24.com on Monday that his group supported the move because it believes it will ensure the affordability of medicine.
Kneale previously accused independent pharmacies of charging patients extremely high administration fees.
- Fin24.com