Sunday Times (Johannesburg) - November 7, 2004
Claire Keeton

MANY patients, particularly medical aid members, are paying more for prescription medicines at pharmacies - despite the government's new rules that have forced down the manufacturers' prices.

A Sunday Times investigation into the prices of common medicines found that consumers were out of pocket. Prices varied from pharmacy to pharmacy depending on the administration fees they charged.

The fees are not controlled by the new government pricing regulations.

At the Sparkport Pharmacy Group in Durban, for example, the cost of key drugs has risen since the new regulations came into force.

The cholesterol drug Lipitor is now being sold at R179.57, up from R155 in April; the beta-blocker Tenormin is up to R155.14 from R129 in April; the antihistamine Clarityne now costs R196 instead of R149.78 and the antiretroviral 3TC costs R141, up from R113.

Pharmacists tend to charge medical aid patients higher administrative fees than cash patients and, in some cases, waive the fees for cash patients.

The fees range from R10 to R50 and sometimes the R10 levy is greater than the cost of the item. Pharmacists began to impose administration fees after their dispensing fees were capped at 26% or R26 for items over R100 in September.

Sandton pharmacist Louis Deenik, who estimates his gross profit is down by about 10% under the new rules, says: "Almost everyone is paying more because of the fees."

Several pharmacies refused to disclose their current prices and fees, while those that were willing to do so showed only slight variations.

For example, Lipitor costs R186 at Greenacres Hospital in Port Elizabeth, R179 at Alexandra Pharmacy in Johannesburg and at Olsens Pharmacy in Cape Town, and R190 at Pharmor Pharmacy in Sandton.

Key players, from the Health Department to the Pharmaceutical Society of South Africa - which took the government to court to challenge the regulations - concur that consumers have been losing out since the rules came into effect.

Dr Anban Pillay, the Health Department's director of pharmaceutical economic evaluations, says: "Consumers are out of pocket and definitely worse off.

"But this will be short-lived. We plan to revise the regulations so the administration fee becomes part of the capped dispensing fee."

But at present the government's hands are tied as it awaits a court decision on whether the Pharmaceutical Society and other applicants get leave to appeal against a judgment against their challenge to the current regulations.

Pillay says: "We are working out how to deal with the problem. We could take the fight to court but, if we did, this could be a protracted process that would not benefit the consumers."

Pharmaceutical society president Siddiq Tayob describes the administration fee as "one of the maladies" of the regulations.

"You can call it an administration fee, a facility fee or a survival fee. The turnover of pharmacies has taken a nosedive and their expenses have stayed the same."

He says already about 15 pharmacies throughout the country have shut down and another 12 have warned they will close shop at the end of the year.

At the same time, Tayob admits: "Patients are hurting as the fee is taken out of their pockets. Various facilities are operating with different fees depending on what area they are in.

"In the township patients do not have the extra cash or plastic to pay."

The head of the National Convention on Dispensing, Dr Mphata Mabasa, says the fees have pushed up the cost of antiretrovirals needed by Aids patients.

"We used to buy these drugs at cost and now we pay a R29 dispensing fee per item. Before the regulations were introduced, the drugs were about R100 cheaper [for the combination therapy]."

A Medscheme director, Gary Taylor, says nobody foresaw how vested interests in the industry would work against the goal of reducing prices. "Consumers were hit in the face when pharmacists imposed an administration fee, which the medical aids may not pay. Hospitals bumped up their ward and theatre fees."

Last month the statutory body, the South African Pharmacy Council, withdrew a schedule of "professional services" fees - to be billed by the minute - that could be charged on top of dispensing fees.

In the past month a new pharmacists' organisation has sprung up that supports the government's drug policy while differing in detail on its implementation.

The South African Progressive Pharmacy Association's chairman, Rakesh Daya, says the association is discussing with the department how to move forward.

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