MANILA, July 28 (Reuters) - Philippine President Gloria Macapagal Arroyo has imposed price controls on nearly two dozen drug brands after pharmaceutical companies failed to comply with a law lowering costs by 50 percent, officials said on Tuesday.
Arroyo signed an executive order on Monday regulating prices of anti-cancer drugs and blood pressure, cholesterol and anti-viral medication, Robert So, the health department’s national drug programme manager, told reporters.
“The order will take effect on Aug. 15 and we’re asking local governments and the trade department to help us monitor compliance,” So said.
He added popular anti-hypertension drugs, like Norvasc which is produced by the world’s largest drug firm Pfizer Inc (PFE.N), were included in the controlled list.
The pharmaceutical industry said it would abide by the law and guidelines set out in the president’s order, but insisted that imposing price control “is not the best approach” in making drugs available to poor Filipinos.
Drug makers last week voluntarily offered to lower prices by an average of 50 percent for about 80 brands for treatment of hypertension, cancer and diabetes to prevent the government from imposing price controls. [ID:nSP442185]
However, the cost cut for some of the popular medicines were less than the 50 percent mandated by law, prompting Manila to resort to price caps.
“Price control may deliver some short-term benefits but the long-term negative consequences, not only on the pharmaceutical industry but in other industries, must be considered,” Reiner Gloor, an industry spokesman, said in a statement.
“If price adjustments do not result in market expansion, then affected companies will have to study options to remain viable.”
The pharmaceutical industry is estimated to lose about 7-10 billion pesos ($146-$208 million) a year in sales, making it hard for smaller drug firms that produce and market three or four products to survive, Gloor said previously.
Gloor said the government’s health reform agenda should be more wide-ranging than just price cuts because most drugs would still be expensive to the poor even if prices were lowered by 50 percent. Nearly one-third of the Philippine population lives on less than $1 a day, according to latest government statistics. (Reporting by Manny Mogato; Editing by Rosemarie Francisco and Lincoln Feast)