Czech drug manufacturers against drugs price cut in 2010

2009-12-18

The Czech Association of Pharmaceutical Companies (CAFF) has questioned the legality of Czech anti-crisis provisions, according to which manufacturers’ drugs prices and reimbursement levels for certain reimbursable medicines will be reduced by 7%. The cut is to be introduced in 2010 for the period of one year and is expected to bring savings of CZK 2.7-2.5bn (€103.7-95.9m) to the healthcare budget.
Having carried out a legal analysis of the governmental measures, the association came to a conclusion that they do not comply with the Czech and EU legislation. CAFF argues that the state has no right to unilaterally reduce the prices and reimbursement levels and that it should rather be done by the means of an administrative procedure. The association sent a letter to the Ministry of Health, listing all the reservations it has against the provisions and asking the Ministry to engage in negotiations with the pharmaceutical sector. The association warns that if the negotiations do not bring a solution to the stalemate situation, it will forward an official complaint to the European Commission.
The Ministry says that it is open to negotiations, which, however, will be limited only to the types of drugs that are to be affected by the 7% price cut, stressing that this controversial step is necessary in order to stabilise finances in the country’s public healthcare sector. The cut is just a temporary measure, but pharmaceutical companies fear that it may be extended over the initial 12 months. Therefore the aim of the potential European Commission complaint would be to prevent this situation from repeating in the future.