Constitutional Court ruling on medicine pricing

October 2, 2005

The Constitutional Court ruling on medicine pricing is a victory for pharmacists, for clear thinking judges on the Cape High Court and for members of the public who have the courage to take the Health Minister to court. It is also a relative victory for Pharmaceutical Manufacturers, private hospitals and Medical Schemes. But it is not a victory for consumers or South Africans using public health facilities.

If the fixed fee for pharmacists on every medicine is priced so that pharmacists are happy, consumers are sure to be overpaying. If the fixed exit price paid to pharmaceutical manufacturers is satisfactory to them, it is likely to be much the same price they previously sold medicines to bulk purchasers. Medical schemes will continue to limit chronic medicine benefits and to pay only the price of a generic equivalent. Members will pay the administrative fee and the difference between a generic and a patented medicine out of their pockets. Generic companies will continue to charge excessively for their medicines (although they have no research and development costs to recoup). Hospitals will continue to charge patients more for medical devices than they pay, while the amount charged will be covered by medical schemes, reducing the money available for a member’s medical needs.

The problems were entrenched in the White Paper which made the Minister and her Director General the Big Sister and Big Brother of health care. They decide everything about anything to do with health care and take on the roll of financial techno wizards, although they have no expertise in finance. They should rather set minimum standards for all health facilities, lay down reasonable minimum packages for medical schemes, set maximum prices only, allowing for bulk discounts in a transparent pricing structure, expose pharmacies to open competition and ensure that nobody disobeys the law.

The Health Minister can shout and scream all she likes about Baragwaneth’s decline, the Constitution that centralizes authority and control with her; the virtually arbitrary manipulation of  prices up or down for medicines, the over regulation of medical schemes, and the Certificates of Need that require every private practitioner or pharmacy to be approved as a “needed” health care provider, have given her the sticky rope to ensnare health providers in a web of bureaucratic controls that makes health care provision in our country irrational and uneven.   Medical devices are not regulated at all. Complementary medicines and herbs are inadequately regulated and are sold at ridiculous prices to a gullible public. The bill hailed to bring traditional medicines onto the arena is impossible to implement.

No wonder Dr Rath pitches his tent on our shores, babies die of hospital induced infections and most patients needing anti retrovirals die before getting them. It is high time the Minister returned to the drawing board and viewed health care in South Africa from the viewpoint of the needy public. She should drop populist socialist interventions and enter into public private partnerships, where government is the main competitor and uses local private expertise to bridge the gap between one of best private health care systems in the world and one of the worst public ones.

Dr Ruth Rabinowitz M.P.(MB BCh)

JHB:Tel: 011 802 1826
       Fax: 011 804 4221

C.T: Tel: 021 403 3061
       Fax: 021 403 3334

Cell: 082 579 3698