HIGH-PRICED drugs charges in Cyprus could be cut by up to 50 per cent if Health Minister Frixos Savvides gets a bill through the House to break the legal ‘stranglehold’ drug importers have had for years.
He aims to introduce the law change this autumn, opening up the market to help drive down prices.
Prices of some drugs and medicines in Cyprus are well over double those in Greece and are, in some cases, far higher than in the UK, for example. Thirty tablets of the ‘miracle’ anti-acne drug, Roaccutan cost C£50 in Cyprus, whereas they’re only C£19 in Greece and C£37 in Britain.
The anti-fat drug Xenical, popular in Cyprus since it made headline news several months ago, sells at £84 for 84 tablets here — in Greece the price is the equivalent of £50, in the UK £57. Thirty Coversyl tablets, for high blood pressure, cost £20 in Cyprus; in Greece they are £11, and in the UK £18.
So it’s not surprising that travellers from Cyprus to Greece are stocking up on supplies, often at airport 24-hour pharmacies.
Asked how badly ‘ripped-off’ consumers in Cyprus have been by over-the-counter prices, Savvides replied: “Oh… pick a number and double it.” He confirmed that “the prices of pharmaceuticals in Greece are one-third of the prices in Cyprus”.
“Hopefully, with the opening of Parliament in October, we will be ready to submit this new legislation,” said Savvides. It would open the market by breaking the lock on drug imports which some 50 members of the Cyprus Association of Pharmaceutical Companies (CAPC) have enjoyed for years. The effect of competition, he said, would be to cut check-out counter charges for all medicines “considerably”.
So how much price reduction can consumers look forward to? “The prices would be reduced by at least 50 per cent,” Savvides said, but that figure is disputed by the Cyprus importers. The minister wants the bill passed by year’s end so that 2001 could start with the free market competition that EU law requires.
Why are prices in Greece that much lower? Both Savvides and CAPC President Sotos Jacovides, an owner of pharmaceutical importer M.S. Jacovides & Co. of Nicosia, agreed that Greece is not the best country to choose when comparing Cyprus with the rest of Europe.
For Greece’s large, domestic drugs industry not only has similar anti-competitive market locks to Cyprus, but it is the only European country that still subsidises production of pharmaceuticals. Savvides said these subsidies benefit industry giants such as Ciba-Geigy, Roche and others. “They are also subsidised indirectly by the big users — EKA, the social insurance, and the (state) hospitals attached to EKA,” he said.
Asked why Cyprus does not import the 50-75 per cent cheaper Greek-made drugs, Savvides replied: “Because the multinational pharmaceuticals have their own agents here. We have to accept these agents. We are not allowed (by Cyprus law) to buy from anybody else. The market is closed.”
“We cannot go outside to the free market and say ‘we need 100 million aspirin’ (and) buy them in Germany at one quarter the price in bulk.”
Under existing legislation, which the new bill would change, the island’s 425 private pharmacies and 35 government pharmacies must buy brand-name medicines from the 50 member agents of CAPC.
Jacovides said that 460 pharmacies were a lot for a republic of only 754,000 people, and he questioned whether they are financially viable. “Most are just surviving,” he said, adding that only a small percentage of the population supports commercial pharmacies. “Most people go to government (clinics) and get their medicines absolutely free. We are talking about 60 to 80 per cent of the population.”
Savvides said that some multinationals, angry at the subsidies policy in Greece, have taken the country to the European Court. “Imagine an international pharmaceutical company produces an equivalent or similar drug (to) something that is produced in Greece with these subsidies. … They take a loss if they sell it in Greece, so they don’t sell it there,” he said.
The European Court lawsuit, Savvides said, is likely to force Greece to cease, or at least alter, its policy because it amounts to unfair competition.
Savvides said Cyprus should compare its pharmaceuticals prices with the rest of Europe, and not Greece.
“We are approximately at the same level (as EU states)… in certain cases we are a little bit more expensive, and in certain cases we are a little bit cheaper,” he said.
Jacovides said the CAPC is in favour of liberalisation of the market. But he warned it would let drugs of dubious quality in from Asia and other places, where standards of production, storage and packaging are not what they are in the West.
And he strenuously disagreed with Savvides’ claim that the proposed new law would usher in price cuts of “at least 50 per cent” of what people now pay for prescriptions.
