Ministry of Health discusses drug price transparency mechanism, says Khairy

KUALA LUMPUR (July 26): The Ministry of Health (MOH) is working to implement a drug price transparency mechanism in a bid to address rising drug prices.

According to Health Minister Khairy Jamaluddin, a ministerial memorandum on the matter is being prepared for Cabinet approval.

“I want [propose] a policy where pharmaceutical companies must present to the government the prices charged for their drugs such as cancer [medication].

“Because there is no price transparency. We are at the mercy of Big Pharma where we don’t know what the real cost of producing the drug is.

“So we’re going [propose] a document [for] a drug price transparency mechanism in Malaysia so that we can know the real price, what is a fair and reasonable cost for certain drugs,” he told parliament on Tuesday, July 26.

He was responding to a follow-up question from Jempol Datuk MP Seri Mohd Salim Sharif on the ministry’s strategy to stabilize the price of raw materials for medicines in order to avoid further price increases, as well as a guarantee that the prices of selected drugs will not be increased.

Apart from the price transparency mechanism, Khairy noted that it could also directly control drug prices if necessary, if pharmaceutical companies do not resolve the issue satisfactorily.

“Price controls are the last resort. The government does not like to interfere in the market, but if necessary, we have [done that before]. For example, for Covid-19 supplies to the private sector, we went in once and determined price checks like RM130 to RM180 per dose for the two products earlier,” he said.

Khairy explained that drug prices are determined by several factors, such as supply and raw material costs.

Citing China as the main producer of active pharmaceutical ingredients (APIs), the minister said the ingredient supply chain had been disrupted when China adopted a total lockdown policy.

“Today we face the problem of shortages and maybe later we will face the problem of price increases. This is due to things happening internationally,” Khairy said, pointing out that apart from APIs, the supply of excipients – ingredients used to support the drug manufacturing process – is also disrupted because many of these substances come from from Russia and Ukraine. , who are currently at war.

Khairy added that patents also determine the price of drugs.

“We are working on this issue so that there is no perpetuation process – [where] the pharmaceutical companies change the drug a bit and they ask for this patent to be extended for many years so that no generic drugs can be produced, and finally the price of the drug remains at a high level,” he said .

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