DOHA: Prices of several medicines have fallen in the local market following a price cap imposed by the Supreme Council of Health (SCH) recently on medicines supplied by a leading distributor.
The distributor in question has issued a new price list to the retailers with reduced prices for several medicines. The prices in general have fallen by about 10 percent, say the retailers.
The SCH in an announcement posted on its website has clarified that the 20 percent cap imposed on the distributor applies to the total profit margin of the wholesaler and the retailer.
The wholesaler is required to fix the prices of medicines by adding a maximum 20 percent profit margin to their costs -- 10 percent for the wholesaler and 10 percent for the retailer. The distributor should also put stickers on each packet of medicines showing the maximum retail price (MRP).
Accordingly, the distributor has fixed the MRPs for their new supplies limiting the profit margin of retailers to 10 percent. The cap imposed on the maximum prices has now resulted in a fall in the prices of several medicines.
Other distributors would also be asked by SCH to follow the same rules in fixing the prices. The price cap has been imposed on the said distributor after it was found that they had raised the prices unjustifiably.
"The Permanent Licensing Committee of the Supreme Council of Health (SCH) has decided to set a maximum limit for the prices and profit margins of drugs and formulations supplied by one of the largest drug dealers in the country.
This is due to the unjustified prices of the drugs and formulations supplied by this company," said the SCH statement.
The Committee's decision was based on the Article (28) of Law No. (4) of 2011 which stipulates that "the competent party, whenever the need arises, and with the assistance of whom it sees fit, may determine the maximum prices of the medical drugs and formulations, and their profit margins.
© The Peninsula 2011
