30 September 2005
The Department of Health welcomes the decision made by the Constitutional Court today on the Medicine Pricing Regulations. The Court ruling is a major victory for the right of the South African public to have access to affordable medicines.
The ruling finally settles the prolonged uncertainty about the status of these regulations and the right of government to regulate the prices of medicine to ensure affordability of these essential products.
The Constitutional Court reversed the decision of the Supreme Court of Appeal which set aside these regulations in December 2004.
The Constitutional Court reiterated the fact that Government has a right to set health policy and adopt measures aimed at making medicine affordable and more accessible. The Court concerned itself only with whether these policies meet the requirements of the constitution and the rule of law.
The Court acknowledged that the new pricing scheme for medicines as set out in the Pricing Regulations are effective in reducing the prices of medicines. The court found that the Pricing Committee which developed these regulations, followed appropriate procedures in executing its duty.
The Court identified a few minor defects in the regulations and specified changes that have to be made. The court said these defects can be easily remedied and it is not proper to set aside the whole set of regulations just for the few minor defects. The Court gave a deadline of 60 days within which these changes have to be effected.
The sections of the regulations relating to the single exit price (ex-manufacturer's price) and the logistic fee remain unchanged except that the regulations must mandate the publication of the logistic fee to ensure transparency.
On the dispensing fee that may be charged by pharmacists, the Court ruled that the Pricing Committee should reconsider the current dispensing fee of 26% of the single exit price capped at R26. The Committee should provide reasonable opportunity for input and take into consideration the input made by all interested parties in determining the appropriate fee.
Of significance is the Court ruling that any information that may be required to arrive at an appropriate dispensing fee should be provided to the Pricing Committee. The Court ruled that the Committee must pay special attention to couriers and pharmacies in rural areas when determining the dispensing fee. The Pricing Committee and Department of Health have been struggling for over the two years to get information from pharmacies that can be used to determine an appropriate dispensing fee.
The Department has always been committed to setting a dispensing fee that meets its objective of making medicine more affordable, but also ensure that the country maintains a viable retail pharmacy industry. Unfortunately this has been hampered by retail sector's resistance to provide the necessary information on their operational cost that would assist the Department in arriving at an appropriate dispensing fee.
While the new dispensing fee is being finalized, the Court ruled that pharmacies should act in a professional and ethical manner in charging a dispensing fee. The Court said charging an excessive dispensing fee will be regarded as a misconduct under the Pharmacy Act. We urge the public to report any excessive charges to the Pharmacy Council or the Department of Health.
We are determined to continue with our efforts to make medicines and health care in general more affordable so that it can be accessible to all South Africans. Today's ruling of the Constitutional Court reinforces and supports our determination to achieve this objective.
Dr Manto Tshabalala-Msimang
Minister of Health
Contact: Sibani Mngadi @ 0827720161