rices of a number of essential drugs in the Philippines have now been halved, and manufacturers - not retailers - must shoulder any price differentials, the government has said.

On Saturday, August 15, Executive Order 821 went into effect, halving the prices of five essential drugs by government decree. Also, the prices of another 16 essential medicines were reduced by voluntary compliance by their makers, and all 21 new price levels were to be implemented immediately at large drug outlets which operate automated systems. Smaller and mid-sized retailers with manual systems have been given until September 15 to introduce the lower prices, but many are reported to be planning to offer them immediately because of competition.

However, they are encountering problems, because while the Pharmaceutical and Healthcare Association of the Philippines (PHAP) has said that its members will offer rebates to retailers which are holding stocks purchased at the old, higher prices, it is also reported that not all manufacturers are willing to offer such rebates. Many pharmacies have said that they will refuse to sell the medicines until they receive the rebates.

The procedures were only put in place last week, Josephine Inocencio, president of the Drugstores Association of the Philippines (DSAP) noted in an interview with the journal BusinessWorld at the weekend, and she pointed to the difficulties they present for small retailers, which have to check their products and then their registries before replacement products and the rebates can be sent.

However, said Health Secretary Francisco Duque: “it is now up to the drugstores and hospital pharmacies to iron out details on rebates, but the assurance is there in black and white that the companies concerned will shoulder the cost for the price differentials."

He has also told consumers to keep receipts for their pharmacy purchases to ensure that drugstores are complying with the new prices, and to report to the Department of Health any that are failing to do so. Complaints desks are also being set up in all Centers for Health Development offices in the country to deal with any problems, he said.

The Department is also monitoring the voluntary price cuts pledged by manufacturers, and will shortly publish a new list of medicines whose prices must be halved, the Secretary added.

Meantime, President Gloria Macapagal-Arroyo is expected this week to sign into law a new measure which will reorganise and strengthen the Bureau of Food and Drugs (BFAD), which will be renamed the Food and Drugs Administration (FDA).

“Current efforts by the government to cut prices of essential medicines by half must be reinforced by strengthening the regulatory agency that is tasked to ensure the quality and efficacy of these products," said Senator Pilar Juliana Cayetano, principal author of the Senate version of the enabling legislation.