The pricing of pharmaceutical products is a sensitive issue in
which governments across the world adopt varying approaches.
The US, which operates a free-market system in respect of
pricing, where the price of pharmaceutical products is determined
by the pharmaceutical companies, has come under increased scrutiny,
particularly in recent years where the price of pharmaceutical
products has risen rapidly. It is a heavily debated topic in the US
in respect of which both of the candidates for the upcoming
presidential election in the US have raised concerns.
In the UAE, pharmaceutical pricing legislation is in place and
provides fixed margins for the distributors and pharmacies in
respect of registered pharmaceutical products sold to
In accordance with Article 65 of UAE Federal Law No. 4 of 1983,
all pharmaceutical products imported into the UAE, need to be
registered with the Ministry of Health. At the time of being
registered, a committee at the Ministry of Health will undertake a
review of the pharmaceutical product and then determine the
"CIF" price for the particular pharmaceutical product.
Pursuant to Incoterms, CIF (cost, insurance and freight) generally
means all of the costs incurred to get the relevant product from
the place of origin to the named port of destination.
In accordance with Ministerial Resolution (140) of 2013 (the
Pricing Resolution), once the CIF price for a pharmaceutical
product has been set by the Ministry of Health:
the agent or distributor of the
pharmaceutical products (that supplies such products to private
hospitals and pharmacies); and
the pharmacy or private hospitals
(that then sell the pharmaceutical products to the end
shall each be paid a fixed margin of the CIF price as set out in
the table below. The margin changes in accordance with the 3 CIF
CIF Price (AED
CIF Price (AED
CIF Price (above AED
Distributor / Agent
Pharmacy / Private
Accordingly, pursuant to the Pricing Resolution, the price of
the pharmaceutical product to the end consumer is the CIF price,
plus the agent's margin, plus the pharmacy's margin.
Previous UAE legislation relating to the pricing of
pharmaceutical products made a distinction between pharmaceutical
products used for chronic diseases and non-chronic diseases,
however, the Pricing Resolution removed this distinction and
applied a single set of margins as detailed above.
The Pricing Resolution applies to both prescription
pharmaceutical products and pharmaceutical products which are
available over the counter. Certain generic products such as
paracetamol and aspirin are products that are not covered under the
The Pricing Resolution applies to the supply of pharmaceutical
products to the private sector, including pharmacies and private
hospitals. Where drug companies are supplying pharmaceutical
products directly to government authorities such as the Dubai
Health Authority or to government owned hospitals or to the Abu
Dhabi Health Services Company (SEHA), the pricing of pharmaceutical
products is not subject to the Pricing Resolution and the price of
pharmaceuticals in this instance is determined as set out in the
commercial arrangements entered into between the relevant
pharmaceutical company and government body or hospital.
It should be noted that the increase in the supply of generic
pharmaceutical products in the market place (as a result of the
expiry of patents applying to private label products), and teh
government's shift to geneic medicines (where possible), is
also having an impact on the pricing of pharmaceutical
In 2011, the UAE government issued a circular which prohibited
the discounting of pharmaceutical products or the provision of
additional / bonus pharmaceutical products, which could also be
interpreted to cover sample products. Whilst this is another
example of the government attempting to exerting control over the
supply and pricing of pharmaceuticals, there are questions whether,
in practice, this circular is strictly adhered to or enforced in
The development of Life Sciences has been one of Mauritius's long time ambitions. It is an industry which meshes well the island's ambitions in the pharmaceutical industry and bio-technological research.
The Pharmacy and Poisons (Amendment) Bill 2014 ("Bill") was introduced in March 2014. The Bill proposes substantial changes aimed at improving and updating the regulatory framework of the Pharmacy and Poisons Ordinance.
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