JOHANNESBURG, Dec 20 (AFP) - A South African court Monday scrapped drug pricing regulations by the government aimed at slashing the cost of essential medicines pending an appeal by pharmacists who say the new prices will force them to close shop.
Cheap medicines are a burning issue in South Africa where some 5.3 million out of a population of 44.8 million people are infected with HIV or AIDS, one of the highest infection rates in the world.
"What the judgement means in effect is that the pricing regulations are no longer in operation," Lorraine Osman said, spokeswoman for the Pharmaceutical Society of South Africa (PSSA) said.
The case was brought by the PSSA, the New Clicks drug company, private health care operator Netcare and five others against Health Minister Manto Tshabalala-Msimang.
The regulations set a cap of 26 rand (3.8 dollars, 3.2 euros) as a pharmacist fee for prescription medicines over 100 rand.
They also called for a "single exit price" by drug manufacturers, barring them from offering discounts and incentive programmes to retailers and pharmacies, a common practice until now.
Judge Louis Harms at the Court of Appeal in the central city of Bloemfoentein, the highest court of appeal in South Africa, said the proposed dispensing fees were not "appropriate" as they were unviable for the pharmaceutical industry and deemed the proposed pricing structure to be "ultra vires," the SAPA news agency reported.
"In a country struggling with limited resources to meet the needs of the poor it is laudable and noble to strive to reduce the costs of medicines," the ruling said.
"We are, however, a nation that subscribes to the primacy of the rule of law and all measures to that end must comply with the principle of legality," it added.
Early this year, South African pharmacists shut their doors for three hours in protest against the new law forcing them to cut their profit margins for medicines, something they say will result in the closure of more than 1,000 chemists.
The Pharmaceutical Society had filed an appeal at the court in Bloemfontein after a Cape Town court in August dismissed their bid for the scrapping of the new drug pricing regulations.
Reacting to Monday's judgment, Netcare said in a statement said that the court had "vindicated the contention of the appellants that the dispensing fee provided for in the regulations was grossly inadequate and would drive pharmacies ... to close their doors."
The health ministry said it would react to the ruling later only after carefully studying the ruling.
The main opposition Democratic Alliance party also welcomed the ruling.
"We urge the government to seize on the court judgment as an opportunity to rethink its approach, and replace what has failed dismally with a system of light and transparent regulation," spokeswoman Sheila Camerer said.
"(This) will allow pharmacies to get back on their feet, and will result in real falls in the price of medicines that are paid by consumers," she added.
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