Private hospitals threaten to go on 'holiday' over medicine price cuts

MANILA, Philippines - Private hospitals may go on a “holiday” if the Department of Health insists on enforcing medicine price cuts by Aug.15.

In a position paper to be submitted to the DOH, the Private Hospitals Association of the Philippines (PHAP) said its members only have one week left to dispose of their stocks of medicine before President Arroyo’s Executive Order (EO) 821 is implemented on Aug. 15.

“PHAP does not oppose the intention and spirit of Republic Act 9502. What the association raises in issue, however, is the fact and the truth, and the government must recognize, that there are still inventories and stocks of medicine (in the pharmacies) of private hospitals that were purchased at the current price and which could not be consumed on or before Aug. 15, 2009,” PHAP president Dr. Rustico Jimenez.

PHAP said that during a “hospital holiday” only emergency cases would be accepted by private hospitals.

But Dr. Robert So, head of DOH’s National Drug Program, said PHAP did not raise the issue when it attended the hearings on the EO recently.

“They were informed beforehand, but they did not articulate that during the meetings so we are really surprised that they are now going to the media about their grievances when our doors are always open to them,” So said.

So said that pharmaceutical companies have committed to give a rebate or adjust the prices of the medicine acquired by drug outlets prior to the signing of the EO.

“The drug companies are willing to adjust but they (hospital owners) will have to do it on their own because they are private entities. They will be the ones to negotiate,” he said. “I don’t think they will shoulder any losses because the prices will be adjusted by the companies,” he added.

The Philippine Medical Association (PMA), meanwhile, said it supports PHAP in its demand but PMA spokesman Dr. Bu Castro clarified that the group also strongly supports RA 9502 or the Universally Accessible Cheaper and Quality Medicine Act.

Castro said the PMA also believes that more time should be given to drug outlets to dispose of their stocks purchased prior to the signing of the EO.

Under the EO, the prices of 21 vital drugs will have to be lowered by half. The products readied for price cuts are on a list prepared by the DOH and the Department of Trade and Industry.

Drug firms have volunteered to cut the prices of 22 other medicine by10 to 50 percent.

The EO stipulates that drug outlets whose inventory system is not yet computerized have until Sept. 15 to adjust prices.

Jimenez claimed that many hospitals would go bankrupt if the government would insist on implementing the EO as scheduled.

“Hospitals are at risk of ‘forced closure’ of their operations if the association’s request is not granted, a situation which is also not desired by the association but otherwise hospitals are faced with the option to downgrade their operations, including the retrenchment of hospital employees and reduction of their services and eventual closure,” he added. 

Under the EO, violators face possible suspension or revocation of license to operate and/or a fine of up to P1 million if the extent or nature of their offense falls under the category of profiteering.