50% of community pharmacists (CPs) are operating "mini-markets" to keep their operations going as they cannot break even just by the sale of medicines, said the Malaysian Community Pharmacy Guild (MCPG).

MCPG president Lovy Beh, said that independent CPs are not doing well, resulting in "over-servicing".

"Over-servicing means pharmacists sell consumer products like a mini-market. So, non-pharmaceuticals like newspapers, magazines, sweets and ice-cream are sold in the stores to attract more customers," she said.

This comes after allegations that pharmacists were selling medicines at high prices for years, on 10 October by Domestic Trade, Cooperatives and Consumerism (MDTCC) Minister Hamzah Zainuddin, who described Malaysia as a "high-priced" island for pharmaceutical drugs at a forum on "Competition Law in the Pharmaceutical Sector".

He also mentioned that there was a need to stop anti-competitive practices that are detrimental to consumer welfare and that a competition law should be passed to deter market manipulation and cartel practices, and to protect consumers.

Previously, seven pharmaceutical firms were under investigation over alleged anti-competitive agreements and abuse of dominance in the sector.

Highly competitive market forces drop in price

Beh pointed out that previously, it was common for pharmacists to charge 25% to 30% above cost to keep their business afloat.

"But these days, they are charging just an additional 15%. Some of them are even selling drugs at below cost," she said.

The "highly competitive market" has been forcing CPs to sell medicines below cost lately and the guild was seeing "a lot more closures of businesses", she added. CPs are often forced to compete with commercial chain pharmacies and doctors, who had the license to dispense drugs in Malaysia.

Beh said that Malaysia does not practice Dispensing Separation (DS), in which pharmacists dispense only with a doctors' prescription. She pointed out that Australia and Britain practiced a DS system, therefore allowing the cost and the retail price reimbursement for medicines to be standardised by the government.

She also called for government control over manufacturers, distributors and retailers and urges Malaysia to implement a similar system.

MPS: Price war has to stop

The price war has to stop or else consumers and pharmacists will be on the losing end, said Malaysian Pharmaceutical Society (MPS) Amrahi Buang.

Defending pharmacists, he said that the mark up in prices were due to the prices that pharmaceutical companies were charging. He explained that the companies could be transferring the cost to the private sector to cover the losses they obtained from selling to the public healthcare sector.

As a free market that is governed by the Competition Act is practised for pharmaceuticals in the private sector - to promote healthy competition among pharmacies and to keep medicine prices low for consumers -, it allows pharmacies the liberty to set their own prices, explaining the difference in medicine prices at different pharmacies, Amrahi explained.

The Competition Act prohibits any form of price fixing in the private sector.

He said that the MPS stance was very clear and urged the government to treat medicines as essential and keep prices affordable by implementing some form of control. Amrahi suggests that the government should negotiate prices with the pharmaceutical companies before they are sold to distribution channels.

He lauded the government's efforts to keep prices low via public healthcare but highlighted that many Malaysians "pay out of their pocket" for private healthcare and such "one-sided" policies actually jeopardised the survival of pharmacies and the public's access to medicine.

"It is about time for the MDTCC, Malaysia Competition Commission and industry players to put their heads together for a solution to benefit the consumers and ensure pharmacies can survive," he said. MIMS

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Sources:
http://www.thestar.com.my/news/nation/2016/11/07/sweet-remedy-the-only-way-pharmacies-relying-on-nonmedical-products-to-stay-afloat/
http://www.thestar.com.my/news/nation/2016/10/11/lack-of-control-leads-to-high-prices-of-drugs-expert-we-must-stop-anticompetitive-practices/
http://english.astroawani.com/malaysia-news/seven-pharma-companies-being-probed-mycc-118990
http://www.freemalaysiatoday.com/category/nation/2016/11/07/pharmacists-selling-sweets-newspapers-to-stay-in-business/
http://www.thestar.com.my/news/nation/2016/11/07/price-war-wont-benefit-consumers-and-pharmacists/