[Reporter’s View]Raising price of cold medicines not enough

to increase supply and resolve scarcity issue

With the shortage of cold medicines remaining unresolved, the government proposed a drug price increase as its final card.

 

The government decided to first take price adjustment applications for dispensed drugs that contain acetaminophen, which is cheaper than other cold medicines.

 

The government had been implementing support measures such as monitoring supply and demand and easing GMP inspections among others to increase the supply of cold medicines that have been lacking due to COVID-19.

 

Also, the government will exclude the amount used for COVID-19 patients from the amount counted for the price-volume agreement system.

 

However, the measures weren’t enough to resolve the shortage.

 

This was why the MFDS Minister Yu-Kyung Oh brought up raising the drug price at the NA Audit as the final card, saying that no other cards were left.

 

Given that this came from the head of the MFDS, not the Ministry of Health and Welfare which is in charge of the price increase, reflects the limitations and frustrations in the support measures for expanding the manufacture of cold medicines so far.

 

However, just a superficial drug price increase will not be enough to resolve the issue, because the ceiling price set for dispensed acetaminophens is too low.

 

Currently, the ceiling price of the dispensed acetaminophen is set at KRW 11-32 for the 0.5g, KRW 26 for the 0.16g, KRW 29 for the 0.325g, and KRW 43-51 for the 0.65g strength.

 

Considering how the over-the-counter 0.65g strength is sold at KRW 200 per tablet, pharmaceutical companies have no choice but to be less active in selling their drug for dispensing purposes.

 

From the companies’ perspective, putting more weight on the over-the-counter products sold at pharmacies or supplying more expensive prescription drugs instead of acetaminophen helps improve company profits.

 

Therefore, the industry believes the government’s price increase will not make a significant impact in increasing the supply if the increased amount is in a superficial range.

 

If the government is to raise the drug price, the rate should be at the extent that considers the suppliers' needs.

 

Moreover, the price should be raised soon.

 

Considering the development of the COVID-19 crisis, applying the price increase in February next year after undergoing all administrative procedures will be too late.

 

Of course, strict screening and negotiations to facilitate smooth supply are required, but if the purpose of the measure is to immediately increase the supply, the procedure should be boldly omitted.

 

Also, prompt action must be taken in advance, as suppliers are likely to stock up on products and defer sales until the price increase is applied.

 

Therefore, the government should also require companies to commit to expanding their supply along with the price increase.

 

The price increase of cold medicines this time is made largely for the public interest of allowing the timely provision of such drugs to patients and long-term care institutions by expanding supply.

 

In consideration of this, the government and pharmaceutical companies should closely work together to achieve the desired effect with the price increase measure.