Updated April 14, 2018 12:17:49The Australian Competition and Consumer Commission has released a new report on the rise in prices in the country’s pharmacy industry, which it says highlights “significant concerns” about the sector’s future.
Key points:The ACCC says it’s “deeply concerned” about pharmacies being squeezed in the drug industryThe report found the rise has been “unprecedented” in the history of the industryThe ACCA says the industry is facing “severe financial pressures” and a “crisis of confidence”There are concerns the cost of medicines has increased by $3 billion over the past 12 months, according to the ACCC, with the average cost of a single pill costing $8,000, a rise of around $150 over the same period last year.
It says pharmacies are being squeezed by the costs of the drug war, with more than one-third of the pharmacies reporting a price increase over the last 12 months.
“A lot of the price increases have been in the $8K to $10K range,” ACCC chairwoman Helen Davidson said.
“We’ve seen the costs go up in every category, from prescription medicines, to insulin and even blood pressure medications.”
Ms Davidson said the ACCCA’s investigation into the price of medicines found the industry faced a “severe economic crisis of confidence”.
“This is because of a large amount of cost pressures, including the price war,” she said.
The ACCCA says the price rise in pharmacies is “unusually large”, with the vast majority of them seeing an increase in the last two years.
It said the price increase has been in line with previous years and the rise is “unique to the drug sector”.
“It is unusual for a pharmacy to see a price rise more than three times in a year, but we do not expect it to continue,” Ms Davidson said in a statement.
“The ACCAC has been investigating drug price increases since 2016 and we have identified the highest price increases we have seen in the past two years.”
The ACC says that is not the case for all pharmacies, but a significant number have seen significant price increases over the years.
The report says the majority of pharmacies surveyed were experiencing significant financial pressures, with almost half of them reporting “severe” financial pressures and another 40% reporting “very severe”.
The ACC is calling on the Federal Government to take urgent action to end the price wars.
“Drug prices are escalating dramatically, impacting on patients’ ability to pay and forcing them to choose between the costs they want to pay or the risk they can’t afford to take,” Ms Clark said.
“The prices that are on the market today are not competitively priced and they have created an extraordinary situation for some pharmacies.”
In order to maintain the safety of the Australian community, we need a fair and reasonable price for medicines.
“That’s why we’re calling on our Federal Government and the Federal Parliament to act urgently to end these price wars and protect Australian consumers.”
Ms Clark said the drug price wars had “disrupted” the Australian pharmacy market and that “unsurprisingly” many of the costs were “significant”.
“In the last decade alone, we have witnessed the most expensive prescription drugs in the world for the first time, and we are now seeing prices in some parts of Australia going up at unprecedented rates,” she added.
“Our medicines should not be priced at these rates and we need to see competition to prevent these prices increasing in the future.”
The report said there were “severe concerns” the cost pressure had “unusual” implications for the industry.
“These concerns include that prices in many areas of the pharmacy sector are increasingly beyond the control of the patient and the pharmacist, which is likely to result in higher prices for some consumers,” it said.
Topics:health,medicine-facilities,health-policy,consumer-protection,corporate-governance,australiaContact Amy Hoyle