Instead of lowering prices – growth of manufacturers’ profits: three months without marketing in the pharmaceutical market

For three months now, Ukraine has had a ban on marketing contracts between pharmacy chains and drug manufacturers. This decision, which was presented as part of the fight against high drug prices, has not actually had the desired effect. Despite громких statements, drug prices have not decreased, but instead the profits of pharmaceutical plants have increased, writes UNN.

DetailsAt the start of the discussion about the cost of medicines in Ukraine, Kateryna Zahoriy, a representative of the pharmaceutical company “Darnitsa”, stated that the abolition of marketing agreements would be an effective tool for reducing prices. 

This sounded at a “very good” time: the President of Ukraine demanded lower prices for medicines, and the government and parliament decided to act quickly – marketing was banned.

Three months have passed. Prices, as even the Ministry of Health admits, have not fallen. Only the cost of some drugs that were included in the “MOH lists” has decreased – usually a few dozen items from each of the domestic manufacturers. All other drugs have become more expensive, especially those of foreign production.

People’s deputies also say that the ban on marketing agreements has not benefited consumers. According to them, manufacturers simply stopped paying pharmacies for marketing, and the promised discount on medicines of 40-60% did not happen.

Against the background of market and public discontent, a discussion was held under the leadership of Deputy Head of the Office of the President Iryna Vereshchuk on the return of marketing, but with a limit. As market participants emphasized, this will allow to maintain transparency, but at the same time not destroy the pharmacy infrastructure.

Despite criticism, the current approach also has its supporters. One of the most ardent of them is People’s Deputy Serhiy Kuzminykh – Chairman of the Subcommittee on Pharmacy. He continues to insist that marketing agreements are the main reason for high drug prices. His arguments almost verbatim repeat the theses of the pharmaceutical company “Darnitsa”, which started promoting the idea of banning marketing.

Whether this is a coincidence or solely a political conviction of the deputy can obviously only be verified by law enforcement. However, in the public sphere, this looks like a “coordinated cooperation” with the pharmaceutical giant. It gives reason to believe in the theory that the deputy is simply lobbying the interests of one plant, and his criminal case, in which he is accused of receiving a bribe for lobbying the interests of a company engaged in the supply of medical equipment.

Instead of conclusionsIt is obvious that the ban on marketing agreements, which was supposed to help patients, turned out to be beneficial only to certain large manufacturers. Medicines have not become more accessible. But the biggest question is the “synchronicity” of the positions of individual deputies with the business interests of specific companies. What could have been a reform has probably turned into a lobbying case. Whether anyone will draw conclusions from this will be shown by the government’s decision.