Hike in drug prices expected soon

Rising cost: A pharmacist arranging medicines at a pharmacy in Bandar Baru Sg Buloh. — AZMAN GHANI/The Star

PETALING JAYA: Amid reports of pharmaceutical drug prices rising in the United States, the same may apply to Malaysia soon.

Malaysian Pharmacists Society (MPS) president Prof Amrahi Buang said if drugmakers moved to raise prices in the United States, the prices of pharmaceutical drugs derived from the US market would be expected to increase between 5% and 10%.

“It is because more than half of our drugs are imported. Usually, every year, the prices will increase twice, but it depends on how much,” he said when contacted.

Prof Amrahi said that even in the endemic stage, pharmaceutical manufacturing had been affected because of delays in the availability of raw materials, active pharmaceutical ingredients and delivery.

“We have seen this for the last few years,” he said, noting that any change in pricing would impact all stakeholders along the supply chain, including the importer, distributor, supplier and retailer.

Prof Amrahi also said that drugs used to treat chronic illnesses such as hypertension and diabetes tended to be more price-sensitive or volatile to price changes compared to more common drugs such as medicines for fever, flu and body pain.

On Dec 29, 2023, Reuters reported that drugmakers planned to raise prices in the United States on more than 500 drugs in early January, according to data analysed by healthcare research firm 3 Axis Advisors.

On Jan 18, the Wall Street Journal reported that companies hiked prices of 775 medicines including Ozempic and Mounjaro, which are drugs used to treat diabetes, at the start of the new year.

Federation of Private Medical Practitioners Associations Malaysia (FPMPAM) president Dr Shanmuganathan Ganeson said the price of pharmaceutical drugs and all essential goods would continue to go up.

“This is due to the rising input cost worldwide such as raw materials, labour, energy and government taxes.

“Malaysia, in particular, will see a minimum 2% increase with the increase of 2% service tax, in particular logistics, starting this year,” he said.

Dr Shanmuganathan highlighted that the price increase of drugs in Malaysia would not only depend on the input costs but also the exchange rate versus the US dollar.

“The ringgit has been going downhill versus all major currencies for the past few years. I am not sure how much further it will go down,” he said.

Dr Shanmuganathan also said that once the prices of pharmaceutical drugs in the United States go up, it would be a stimulus for the rest to follow suit.

“The universal supply of goods has always been based on the free market concept, which is demand versus supply.

“When supply constraints arise, who can pay the highest price will always get the goods first.

“After all, businesses are not charity organisations. They are here to profit,” he said.