Scrap taxes on medicines – Chamber of Pharmacy

Business News of Monday, 29 August 2016

Source: thefinderonline.com

2016-08-29

Drugs PillsFile photo

The Chamber of Pharmacy Ghana, has called for the removal of the current taxes on medicines, which are contributing to the current increases in prices of the commodity and threatens quality health care delivery.

They said the removal of the taxes would not only improve the timely supply of most required medicines but also lesson the bill burden of patients, especially those with terminal illnesses.

It would further lower the cost of managing the National Health Insurance Scheme (NHIS) and paying suppliers on time.

Mr Harrison Kofi Abutiate, the Chairman of the Chamber of Pharmacy Ghana, at a sensitisation workshop in Accra on Wednesday said, the current high taxes on imported medicine is a disservice not only to importers, but also to government and patients.

He said although the ECOWAS Platform has approved the removal of taxes on medicines of which some neighbouring countries have complied to, Ghana has maintained the 17.5 per cent Valued Added Tax (VAT) on these commodities, leading to the high cost of importation.

He explained that apart from the 10 per cent import duty that was removed on imported medicines, a 17.5 per cent, was put on imported finished medications, but only 30 per cent of medicines are manufactured locally, with the remaining 70 per cent being imported.

Therefore, an additional 17.5 per cent VAT on imported medicines thus increases medicines bill of over 52.5 per cent, not to mention other additional taxes like ECOWAS Levy, Export Development Levy, Processing Charges, Special Import Levy, Development Fund Fee, Food and Drugs authority Inspection as well as the Ghana Standards Authority charges, he said

Mr Abutiate argued that being the biggest purchaser of medicines for the NHIS, Government is increasing its own price wage by maintaining the present taxes and called for an urgent review in policy.

He explained that drug resistance due to substandard imported medicines at low costs and the inability of patient to afford the required doses of medications, is contributing to the current increases in the disease burden of Ghanaians, which may also aggravate and swell up governments cost of Out Patient Department care and treatment of illness under the NHIS.

Current statistics, he said shows that in 2008 NHIS saw nine million outpatient visitations to hospitals while in 2015 there were 29 million visitations, and within these same years’ money paid to NHIS Providers was GH? 183 million and GH? 1 billion.

“If on the average half of these card holders got medicines which had all duties paid on them, the drug bill would have been halved,” he said.

Mr Abutiate said medicines are not ordinary products of commerce, but are essential in ensuring the health and the wealth of the nation, and must be treated as essential commodities in order to holistically attain the “Good Life” professed by the Ministry of Health.

He said the workshop would explore all the avenues so as to arrive at a win-win situation for medicine suppliers, the National Health Insurance Authority and Government as well as patients.

He encouraged local pharmaceutical companies to target the large scale production of essential medicines like anti-malaria drugs and others that are in high demand locally for ready market in order to remove imported substandard products from the market.

Mr Anthony K. Ameka, the Chief Executive Officer of the Chamber of Pharmacy Ghana said Chamber is proposing for the development of an exclusive list to cover the products that are manufactured in Ghana, and support adequate financial access with local banks for local pharmaceutical manufacturers.

It would also establish an exclusive pharmaceutical village, encourage local manufacturers to partner foreign research based companies and thus enhance technology transfer, support the WHO prequalification status for local industries and promote the establishment of an investment fund for skills training.

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