Medicine prices likely to fall

By Zainab Al Nasseri — MUSCAT: April 23 - Margins on medicines have been capped at 45 per cent of the landed price under a new Health Ministry decision published in the official gazette on Sunday. This compares with margins aggregating around 80 per cent of the landed price before the new decision came into effect. Ministerial Decision 74/2017 amends the formula for computing the retail price of regulated medicines and pharmaceutical formulations. It replaces Ministerial Decision 86/2000, according to the official gazette. The latest decision states that the price for any medication shall be computing on the following basis: Cost, Insurance and Freight (CIF) of the product as endorsed by the Technical Committee, plus a margin of 45 per cent as local distribution costs (comprising a 26-per cent share for the retail pharmacy and a 19-per cent share for the main distributor). In the past, the retail price was computed as an aggregate of the CIF price, plus 55 per cent for the retail pharmacy and 25 per cent for the main distributor. This formula now stands scrapped under the new Ministerial Decision. As a result of an amendment in the formula for the computation of retail prices, the retail cost of medicines and pharmaceutical formulations in the Sultanate is expected to drop significantly.