He mentioned that in the last few hours he "delved into this topic and came to a preliminary conclusion that it is not possible to assert that regulating the pharmaceutical market will necessarily lead to a total shortage of medicines."
"The situation in the pharmaceutical industry is ambiguous and requires clarification so that everyone can draw their own conclusions," the expert wrote.
Kulik conveyed information from Health Minister Viktor Lyashko that statistics indicate market mechanisms are not functioning, which is why regulation had to be intensified.
"The minister provides the following figures: the price increase for domestically produced medicines ranges from 26% to 131%, and markups for 'private label' products in pharmacy chains range from 50% to 300%. I believe everyone can see the constant rise in prices at pharmacies. It's enough to get sick just once a year and buy cold medication. You will feel the difference in the cost of the medicine. Another reason is the high marketing payments that pharmacies receive for selling specific drugs. This leads to people purchasing more expensive medications instead of cheaper ones with the same active ingredient," he emphasized.
From this, Kulik concludes that Lyashko believes there are "prerequisites for lowering prices, if market participants were willing."
"Of course, no one wanted to give up excessive profits even during the war. Six months of consultations between officials and market players yielded nothing, including on the [adopted on February 12 in the second reading] bill №11493. Therefore, the government had to intervene," the expert noted.
According to him, during meetings with businesses, authorities discussed various action plans to lower drug prices and accepted, in particular, the following (which will later be detailed by the government):
- markups on medicinal products have been regulated;
- the practice of marketing payments has been banned (until reference prices are introduced);
- price checks on medicines in pharmacies have been resumed;
- reference prices and a National Price Catalog have been established.
"In this situation, it indeed makes sense to introduce certain restrictions. However, they should allow the market to continue functioning. After the war ends, I believe these regulatory norms should be lifted. And now we come to the key question: is a shortage of medicines possible after increased regulation? Market experts with whom we spoke assert that our retail market is developed, pharmacy chains are competing, and we have many producers and importers. In theory, competition will increase, and there should not be a shortage on pharmacy shelves. Do you think the requirement to have one cheap medication in pharmacies could lead to a drug shortage?" Kulik wrote.
In his opinion, foreign manufacturers may partially leave the Ukrainian pharmaceutical market, but "all changes will affect the generic drug market (analogues of original medicines), rather than unique, innovative drugs."
"And one more point I would correct in my previous text. I was not entirely accurate in defining the reform in the pharmaceutical market as 'the reform of [MP from the 'Servant of the People' party Mikhail] Radutsky.' I have closely analyzed the statements from the president and news from Bankova. Therefore, I would refer not to 'Radutsky's reform,' but to the reform of [Ukrainian President Volodymyr] Zelensky. The demand for lower drug prices and their accessibility is one of the 'pain points' of society, which affects public sentiment. Zelensky is trying to seize this topic from critics and rightly proposes to maintain affordable prices for ordinary citizens through state regulation to ensure access to quality medication. People are not concerned about who has what markups in the market. What matters to them during the war is the ability to buy affordable and quality medicine in pharmacies," Kulik explained.