Vietnam’s drug manufacturers and importers who increase drug prices before June 30 will be fined and temporarily shut down, the Ministry of Health said.
The ministry has maintained that it will continue to control pharmaceutical prices as the rising cost of imported materials used to make drugs in Vietnam has tempted local firms to increase their price tags.
Amid national and global price fluctuation, many drug companies have said they need to increase prices just to break even, according to Hau Giang Drug Company General Director Pham Thi Viet Nga.
But any drug company in Vietnam that wishes to change prices must submit a price-adjustment application to their local public health department or the Drug Administration of Vietnam (DAV), said Vice Director of the Ho Chi Minh City Department of Public Health Pham Khanh Phong Lan.
Only those companies able to prove that their price increases were absolutely necessary would be granted permission for adjustments, she said.
In April, the health ministry instructed provincial and city departments to put off considering all applications until June 30, so many drug companies have resorted to temporary solutions to curb losses.
The Hau Giang Drug Company, for example, has decreased output of three products by one-third and has plans to cut production of several more until June 30.
Lan emphasized, however, that the ministry will not lift its control on drug prices at that date.
June 30 is simply the date at which applications will be considered again, she said.
But many drug companies expect to have their applications approved at the end of next month, meaning that drug prices may rise rather suddenly in July.
Most local drug manufacturers import 90 percent of their raw materials while 50 percent of all drugs sold on the market come from foreign suppliers, brought in by Vietnamese import companies.
The costs of several types of drugs are already on the increase at retail drugstores, but Lan said this was because pharmacies are generally unregulated and set their own prices.
Drug companies on the other hand, are under much more scrutiny from administrative agencies and can not get away with such practices.
But domestic product prices at HCMC’s Drug Center, a local unregulated pharmacy in District 10, have gone up by 5 to 25 percent recently.
According to Lan, however, the rise in retail drug prices has been insignificant overall as drugstores and pharmacies account for just 25 percent of the entire drug market, while regulated public medical establishments like hospitals and clinics comprise 75 percent.
City officials now want to control retail prices by inspecting drugstores more often and fining those that sell drugs at inflated prices, said Lan.
Quality inspections
The Hanoi-based Central Drug Laboratory Institute has said it would begin strengthening its drug quality inspections at local drugstores.
The quality of over 30,000 samples would be tested in the new round of evaluations, said the institute.
The move is part of government efforts to tighten drug-quality control, since the appearance of fake and second-rate drugs has been on the rise in the local market, said Trinh Van Lau, head of the Central Drug Laboratory Institute.
Many of the most commonly purchased drugs like antibiotics and herbal medicines are often imitated by unlicensed firms that produce inferior products.
The fake drugs, according to Lau, tended to be sold mostly in Vietnam’s large cities where consumption was high as opposed to more remote areas.
The increase of imitation drugs on the market is due to the lack of inspections, Lau said.
Most drug laboratories around the country have yet to meet Good Laboratory Practice (GLP) standards.
Nearly 0.2 percent of all drugs, or 180,000 products on the market, were found to be imitations last year.
Substandard drugs, meanwhile, accounted for 3.3 percent.
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