The framework for pricing of pharmaceutical products in Turkey is set by the Council of Ministers decision numbered 2007/12325 published in the Official Gazette on 30.6.2007 and numbered 25568 (last updated on 04.12.2009) ("Decision"). The Pharmaceutical Pricing Decree published in the Official Gazette on 22.9.2007 and numbered 26651 (last updated on 11.06.2010) ("Decree") lays down the grounds for the implementation of the pharmaceutical pricing system in further detail.
The below overview aims at providing general information regarding the pharmaceutical pricing system in Turkey.
"Reference Countries"
The pricing system is primarily based on the reference prices of the relevant pharmaceutical product in the reference countries declared annually by the Turkish Ministry of Health ("MoH"). The MoH can declare at least 5 and at most 10 European Union countries (including countries which are on the path to membership) as "reference countries". Currently, the reference countries are France, Italy, Spain, Portugal, and Greece.
"Reference Price"
The MoH determines the prices of both original and generic pharmaceutical products based on the "reference price", namely; the official lowest sale price to wholesalers, (excluding VAT and discounts) of the original product which is registered and sold in the market amongst the reference countries.
In the event the country of manufacture (batch release) or import of the relevant product is not one of the reference countries (or the EU countries), and there is an officially declared lower sale price to the wholesalers at this country, the sales price of the country of manufacture/import shall be accepted as the reference price.
The Decree stipulates various calculation and proportionalization techniques for specific circumstances where the general rules need to be interpreted to effectively determine the product's price.
"Price Determination"
Following the initial license registration of a product, the license holder needs to apply to the MoH with the price declaration form and supporting documentation for the determination of the price. The relevant transaction shall be conducted in the light of all information and documents submitted by the relevant company to the MoH.
Applications for receiving an initial price shall be concluded within 60 days. This period may be extended by 30 days depending on the work load of the administration. Price related applications other than the initial pricing shall be finalized within 10 days. The price is set based on the information provided by the license holder.
The license holder is liable for the accuracy of the information provided to the MoH. Furthermore, the license holder is clearly held liable to duly inform the MoH regarding the reference prices and the decreases. The MoH at its discretion may control the said price information through the use of the national or international data bases and through official inquiries.
Sanctions
In the event the license holder does not act in accordance with the above mentioned declaration liabilities, the relevant provisions of the Turkish Criminal Code shall be applied and the public loss arising from the violation shall be collected by the Ministry of Finance and the Social Security Institution. In practice, the questions in the implementation of the system are attempted to be settled through contacts with the MoH without resort to legal recourse.
Conclusion
Once the sales price to wholesalers is determined, wholesalers and pharmacy sales prices are calculated based on a progressive scale of respective profit also fixed by the Decree.
The pharmaceutical pricing system in Turkey is complex and the subject of great controversy. The Social Security discount and public procurement systems also have an important impact on the pricing of pharmaceuticals, which are also very detailed. Consequently, the pricing system has undergone numerous changes in the past 7 years within the Turkish government's health reform. The most recent changes to the legislation adopted in 2010 have adjusted the implementation, aiming for further clarity. Undoubtedly, these changes will not be the last.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
