Karbauskis explained why medicine is more expensive in Lithuania than in Poland

On February 13 the Peasant and Greens Union presented the outline of reforms aimed at reducing the prices of pharmaceuticals in Lithuania. Ramūnas Karbauskis claims that the measures are being implemented because the prices of medicine in Lithuania are larger than those in Poland or other markets.

Minister of Healthcare Aurelijus Veryga notes that based on the legislation being prepared, the pricing for pharmaceuticals would be reviewed several times a year. Initially such reviews would be done at least twice per year.

When buying medicine at hospitals, the requirement to obtain medicine in Lithuanian packaging will be abolished.

A. Veryga also speaks of the need for educational work in explaining to patients that generic brand pharmaceuticals are as good as branded ones, just significantly less expensive. “People could already save significant sums if they would not buy and overpay for excessively expensive medicine in an attempt to convince themselves they are superior to other options,” the minister said during a press conference.

The politician also explained that efforts will be made to legalise mystery shopping. “The government will take a more active role in ensuring that pharmacists would offer the most affordable medication. Today we cannot be sure whether this truly happens. As we have said, people overpay for medicine, even if there are less expensive options,” A. Veryga said.

According to the minister, the planned reform also includes implementation of recommendations from the Competition Council to prevent announcing pharmaceutical prices to interested parties. A. Veryga explains that currently pharmaceutical suppliers can easily monitor prices and saw little reason to offer more affordable medicine.

Furthermore there are plans change the formation of the Compulsory Health Insurance Council which decides which medication is included into the list of medicament that are compensated for.
Healthcare Committee Chairwoman Agnė Širinskienė says that the composition principles of the council are to be reviewed soon. Currently, she stated, the council is formed from 16 individuals, however the current situation is such that a third of its members have not declared public and private interests and one council member has been accused of illegal profiteering.

“These people not only monitor the State Healthcare Fund’s financial and economic activities, but also provide proposals to the Minister of Healthcare regarding the inclusion of medicines to be included into compensation lists,” Širinskienė said.

She notes that it is important to limit council member terms and number of terms through legislation, set a requirement of a blemish free reputation, ensure the work of the private interest declaration mechanism.

“The current council formation regulations allow people working in the pharmaceutical industry to enter the council,” the politician stressed, highlighting that certain members have been in the council for almost decades.

According to the committee chairwoman, currently legislative amendments are being prepared which would set the term of the Compulsory Health Insurance Council members to two years, with a maximum of two consecutive terms. As such individuals would be able to work in the council for four consecutive terms at most. Furthermore the council would have to be formed at a tripartite principle – it should represent government institutions, insurers and those insured in equal proportion.

R. Karbauskis aims at Eurovaistinė and Camelia

Meanwhile Peasant and Greens Union chairman and Seimas group prefect R. Karbauskis is accusing the pharmaceutical store chains of Eurovaistinė and Camelia before the Competition Council for potential breaches of competition. The politician does so on the basis of a Verslo Žinios article which reveals that the companies managing Eurovaistinė and Camelia – EVRC and Reklamos Sklaida have separated their pharmaceutical chain advertising and marketing departments, registered them as separate companies and mastered the “shelf tax”.

“Both UAV EVRC and UAB Reklamos Sklaida are potentially being used as “shelf tax” gatherers in order to hide discounts provided by wholesalers,” R. Karbauskis said.

The politician claims that suspicions are strengthened by the remarkable profitability of the two companies. For example the profitability of EVRC exceeds the profitability of Eurovaistinė some ten times.

“The article reveals that the “shelf tax” is paid by the wholesalers, the pharmaceutical producers and distributers in order to have their produce be sold in the Eurovaistinė and Camelia chains. The “shelf tax” limits competition in the pharmaceutical market. Only the medicine of those who pay up appears in the pharmacy chains. Furthermore such a tax can lead to premises to distribute more expensive medicines in the chains,” R. Karbauskis said.

According to him the Peasant and Greens Union plans to create a workgroup and prepare amendments to the Pharmacy Law, which would limit such malpractice by pharmacies.