DOHA: The recent move by the Supreme Council of Health (SCH) forcing a leading distributor of medicines to reduce their unjustified prices has caused confusion in the market, with the dealer in question allegedly trying to pass over the burden to the retailers.
Following a public outcry about an unusual rise in the prices of medicines in the local market, the SCH recently had asked a leading wholesaler to limit the price hike to a maximum 20 percent and pass over 50 percent of the benefits to the retailer.
Retailers say that they have received a new price list from the said wholesaler, with reduced prices for several items, but they are in a dilemma on how to implement the new prices.
The confusion prevails because the retailers have not received any guidelines from the SCH regarding the new move. Prices of several medicines have been reduced in the new price list, but the distributor allegedly has tried to offset their losses by cutting the profit margin of the retailers by about 50 per cent.
"The consumer will benefit since the retail prices of several medicines have been reduced considerably in the new price list. But we are going to be the losers since our profit margin has been limited to a maximum 10 percent. The distributor has increased the costs, while reducing the prices. We have no idea whether they have been allowed by the authorities to do that," a pharmacist told this newspaper yesterday.
He said many retailers had stocked huge quantities of medicines that were bought from the distributor at high prices.
"If we reduce the prices of the existing stocks, we will incur heavy losses. We are waiting further clarification on how to deal with the new price list. Many pharmacies will find it hard to survive with a 10 percent profit margin," he lamented.
According to the new SCH guidelines, the distributor must put a sticker on each packet of medicine showing the maximum retail price.
Retailers say that there is too much ambiguity about the new pricing system. The SCH has already stopped fixing the prices of medicines, following the recent laws lifting government control over pricing. The law however allows the authorities to put a cap on the prices as well as the profit margin of the retailers and the wholesalers if there is a need.
Who has fixed the 10 percent profit margin for the retailers, the SCH or the distributor? And what is the profit margin of the distributors? Is the wholesaler in question acting smart to surpass the government move? The retailers or customers have no answers to such questions.
There are also unconfirmed reports that another leading distributor has hiked the prices effective from this month.
© The Peninsula 2011
