Back to the drawing board on medicine dispensing fee

The South African Department of Health and a group of pharmacists were ready to begin work on a new medicine dispensing fee, both parties said after a Constitutional Court judgment on Friday.

The laws previously capped the dispensing fee at between 16% and 26% of the price of a medicine, which pharmacists said would put them out of business.

The Department of Health had asked the court for permission to challenge a Supreme Court of Appeal (SCA) ruling that declared the regulations invalid.

From December it was not clear which pricing laws applied, so individual pharmacies determined their own fee scales. The Constitutional Court ruled that the SCA should have been approached to determine this while its own judgment was awaited.

In its judgment, the Constitutional Court set aside the SCA ruling declaring the laws invalid, but said while there was no need to scrap the law, some changes had to be made to it.

These related to the addition of valued added tax, the logistics fee and the way recommendations are made to the health minister.

It ordered that the pricing committee, tasked with making pricing recommendations to the minister of health, to allow oral submissions on the pricing system. Pharmacists were not given this opportunity earlier.

It gave the minister of health 60 days to publish the changes it ordered, in the interests of transparency for the public.

Pharmacists could still charge a dispensing fee, and the court believed that they were ethical and would not exploit the public until a final decision was made.

Source:SAPA Court orders review of drug dispensing fee Business Day 30 September 2005

For text: http://www.businessday.co.za/articles/topstories.aspx?ID=BD4A97357

FMF Policy Bulletin/ 04 October 2005