Government, pharmaceutical industry deadlocked in negotiations over generic drug prices

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Generic drugmakers say further restrictions on their revenue could lead to more product discontinuations and exacerbate supply shortages.

Negotiations between government and industry on access to generic pharmaceuticals have reached an impasse over whether drug prices should go lower despite rising production costs.

It is the third time the two parties have negotiated, after previous agreements were signed in 2014 and 2018. The current deal expires March 31, 2023. The companies say that, at the same time as their prices are fixed or declining, they have faced record inflation in the cost of raw materials and labour.

The CGPA says it is asking at this time for prices to at least remain flat and for there to be a mechanism for modest price increases during periods of high inflation. However, he said, the whole framework of collective bargaining between industry and government buyers is flawed because it sets blanket prices that could be beat if contracts were put out for individual products, as is done with other areas of government procurement.

 

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